The debate about the relative merits of free trade and protectionism has a long history in Europe, stretching back at least four hundred years to the argument between the mercantilists and their eloquent and persuasive adversaries in the eighteenth century, David Hume and Adam Smith. The debate goes on in the closing decade of the twentieth century in the wider arena of worldwide negotiations in the Uruguay Round to reduce or remove restrictions on international trade in goods and services. A majority of economists have long since espoused the advocacy of Adam Smith in favor of liberalization, but decision-makers are still attentive to the special pleading of constituencies of interests clamoring for protection from “unfair” or “disruptive” foreign competition.

In contemporary Europe the battle lines between the adverse camps have been redrawn, and some of the issues at stake obscured, by the accelerating drive toward economic integration within the European Community (EC). Not only has the EC carved out for itself the lion's share of world trade.