This paper examines British policy toward European monetary integration. It challenges dominant liberal theories of preference formation, suggesting an alternative intervening variable in the form of the electoral system, which privileges Euro-sceptical opinion in a relative sense. Empirical evidence is presented on both UK economic behavior and the views of domestic economic interests from the decision not to join the Exchange Rate Mechanism in 1978 to the decision not to participate in the first wave of countries joining stage three of Economic and Monetary Union
