Does 1992 Come Before or After 1990? On Regional Versus Multilateral Integration

Although much has been written recently on the likely impact of 1992 on European economies, relatively little attention has been devoted to the external impact of the internal market. Yet, given the importance of the Community in world trade, the completion of Europe's domestic market could exert a profound influence on nonmember countries. This paper examines the Community's external trade policy in the context of 1992. The first part presents the basic tools for analyzing the impact of integration on trade and welfare. The second part briefly reviews the experience of the first thirty years of European integration. The third part attempts to assess the external impact of 1992 in the light of theory and past experience. The last part looks at the interaction between 1992 and the Uruguay Round of GATT negotiations scheduled to be concluded in 1990.