PETER COFFEY Since the appearance of the second edition of this work - which was so quickly out of print - so much has happened in Europe. In the EEC itself, 1989 was a watershed year concerning the Community's moves towards the creation of the Single European Market (SEM) by the end of 1992. Early in the year, the appear ance of the De10rs Report on Economic and Monetary Union in the European Community, was followed by an agreement, at the European Summit, in June, to begin the first stage of this union in the Summer of 1990. As a counterpart to this and other agree ments, seen by trade unions and similar groups as an agreement * New composition of the ECU as on 21 st September 1989. Deutsche Mark DEM : 30.10% French Franc FRF : 19.00% Pound Sterling GBP : 13.00% Italian Lira ITL : 10.15% Dutch Guilder NLG 9.40% 7.90% Belgian Franc BFR 2.45% Danish Kronor DKK 1.10% Irish Pund IEP 0.80% Greek Drachma GRD 5.30% Spanish Peseta ESP 0.80% Portuguese Escudo PTE IX x between governments and businesses, there followed calls for and the adoption by eleven Heads of State of a Social Charter.

At the end of 1992, things will never again be the same inside the European Economic Community (EEC), because, as that year draws to a close, the aims of the Single Act of European Union (SAEU), which became law in July, this year, will have become effective - thus creating a 'real' Common Market. This will mean that there will no longer be any obstacles to the free movement of goods between the Member States. Equally, and for the first time in the EEC's history, internal capital movements will be absolutely free, there will no longer be any exchange controls and it will be possible to freely establish financial services between EEC countries. Likewise, as currently being proposed by Lord Cockfield, wide variations in the levels of value added tax (VAT) between Member States will not be allowed. Also, in the case ~f the Common Agricultural Policy (CAP), it will no longer be possible (nor even necessary) to have the monetary compensatory amounts (MCA's). All these changes - but especially the increased freedom in capital movements - will have profound consequences for the different regions of the Community and it will be desirable to have a much more dynamic Regional Policy before 1993. Last, but by no means least, a greater number of decisions inside the Community will be made by majority voting and the Parliament will be endowed with enhanced powers.

Main Economic Policy Areas of the EC: After 1992 is a completely rewritten version of past editions. It examines successes and problems associated with the EC's main economic policy areas and makes proposals for the future. For the first time, a chapter on the very important policy area of transport is included. This volume is an indispensable course book and handbook for all individuals interested in the European Community's main policy areas at the beginning of the coming into effect of the Single European Market.

THEBACKGROUND Why a book on Europe - Toward the Year 200l? There are two principal reasons why a European should embark upon such a hazardous enterprise. First, when the Treaty on European Union (popularly known as the Maastricht Treaty, and, hereafter referred to as the Treaty in this introduction) was signed in February 1992, it was agreed that the heads of government of the EU Member States would assemble, in 1996, to examine its workings. This meeting will be known as the Intergovernmental Conference (IGC). Second, by the end of the century, it is certain that arrangements will have been made for the admission of some countries of Central and Eastern Europe into the European Union (EU). Consequently, even with or without the holding of the IGC, it will be urgently necessary to reform some of the Community's policies - notably the Common Agricultural Policy (CAP) and the structural poliCies which are linked, for example, 2 Europe - Toward 2001 with the Regional and Social Funds - before these countries become members. Failure to do this could result in bankruptcy for the EU. Of almost equal importance is the reform of the institutions and the actual workings of the Community. Already with 12 Member States, it was difficult enough to manage things on a daily basis. Now, as more countries join the Union, things could literally grind to a stop. Thus, changes in this area are indispensable.

This new edition of International Economic Integration, has been fully revised and updated to reflect current developments in this increasingly important area. New features include: * Completely new introduction and conclusion * Chapter added on integration schemes which includes discussion of the East and the enlargement of the European Union * Chapter on the Common Market expanded to include new developments in capital mobility and industrial policy * new real life examples, quanitative studies and statistical material * Treatment of issues even more accessible following feedback from first edition Building on the reputation of the highly successful first edition, this volume will continue to be considered the definitive work on the subject and to be a vital reference for students of international economics.

This volume in essence continues my recent contributions towards building up a better understanding of the wide range of obstacles besetting the transitions away from administrative planning in the former communist regimes in the eastern part of Europe. It is self-contained, however. As such, it specifically addresses issues revolving around how best to govern economies, and indeed societies more generally, that are undergoing fundamental structural transfor mation, and whether industrial policy can facilitate progressing with the vexing transformations that will have to be enacted over a protracted period of time. Because of the bewildering variety of hindrances that the managers of the transition have been confronted with, many of which were not even contem plated when the programs were first designed, regaining a measure of good governance, including notably good economic governance, is critical in formu lating a positive pOlitical economy of transition. Arguably most critical is steering the processes of destruction and creation-not 'creative destruction' in the Schumpeterian sense. In some cases, this requires reallocating decom missioned resources, both capital and labor, to new activities. Changing rules on the utilization of existing assets is evidently at the core of what the transi tion towards market-based economic systems should be all about Very often, however, this requires establishing new economic activities from domestic and foreign savings.

In this major new text, Miroslav N.Jovanovic presents an analysis of all the major aspects of economic integration in the European Union. Beginning with an overview of the origins of European integration, he moves on to discuss in detail all the main policy areas. These include: *monetary policy *competition policy *industrial policy *fiscal policy *trade policy *the Common Agricultural Policy *foreign direct investment *regional policy. The volume also includes a discussion of less well-known policy areas, such as social policy, environmental policy and transport policy. Containing an excellent blend of theory and practice and presenting a highly complex issue in an accessible and non-technical way, this text will be an invaluable resource for students of international economics, international business and European studies.

This book is the third volume in the new series of books on International Regional Economic Integration published by Kluwer Academic Publishers. The Editor begins his examination with an extensive introduction which emphasizes the historic nature of the next enlargement of the European Union. The point of reference for enlargement is the European Commission's Agenda 2000, which covers all the policy areas which the new Member States will have to accept. Although this document is a very important one, it does not pay enough attention to the necessary policy changes and institutional changes which should be made in advance of enlargement. This volume tries to rectify this oversight by offering an assessment of the costs and benefits of enlargement to present and future EU Member States. In view of the importance of all these considerations, special attention is paid to the possible implications of the weak compromises made at the much-heralded Berlin Conference, held in March 1999. To that end, the volume presents an examination of the policy and institutional changes which must be made in advance of enlargement. The following major areas are covered, since with the exception of CAP, they would, in future years, have the most influence on the present and future EU Member States. These areas are: The economic and monetary union and the Euro; Enlarging the European Union: Is Agenda 2000 a guiding star for the new millennium? Regional policy; The impact of the single market on the big European countries - possible consequences for enlargement; and The financial markets.

Economic Analysis of Institutions and Systems aims to redirect the study of what was previously referred to as comparative economic systems toward analysis of the history and development of institutions, and the effects of alternative institutional arrangements on economic behavior. To this end, the book internalizes into a theoretical framework: (i) the effects of alternative institutions on the costs of transactions and incentive structures; (ii) the effects of the costs of transactions and incentives on economic behavior, and (iii) the evidence for refutable implications of those effects. In the process, it provides the logical premises for various institutions from which refutable implications can be deduced.