¹ See, for example, Dam, Kenneth W., The GATT-Law and International Organization (Chicago: University of Chicago Press, 1970)Google Scholar.

² SeeBaldwin, Robert E., Non-Tariff Distortions of International Trade (Washington, D.C.: Brookings Institution, 1970)Google Scholar.

³ British entry to the EC led to the final termination of the British Commonwealth, which encompassed preferential tariffs between members, some developed and some less developed, and had been one of the major “regional” trading arrangements in the world since its formation in 1932.

⁴ For further details, see the essay in this volume by Holzman and Legvold.

⁵ Centrally planned economies that are in the developing country category are excluded from the following description.

⁶ In some cases, somewhat similar organizations preceded the ones established in this period.

⁷ Honduras has suspended intraregional free trade and modified its external tariff on some goods.

⁸ Mikdashi, Zuhayr, “Cooperation Among Oil Exporting Countries with Special Reference to Arab Countries: A Political Economy Analysis”, International Organization 28 (Winter 1974): 20CrossRefGoogle Scholar.

⁹ For additional discussion of this point, see Bergsten, C. Fred, “The Threat From the Third World”, Foreign Policy, no. 11 (Summer 1973): 102–24Google Scholar; Mikdashi, Zuhayr, “Collusion Could Work”, Foreign Policy, no. 14 (Spring 1974): 57–67Google Scholar; Krasner, Stephen D., “Oil is the Exception”, Foreign Policy, no. 14 (Spring 1974): 68–83Google Scholar; and Bergsten, C. Fred, “The Threat Is Real”, Foreign Policy, no. 14 (Spring 1974): 84–90Google Scholar.

¹⁰ Cooper, Richard N., “Economic Assumptions of the Case for Liberal Trade”, in Bergsten, C. Fred, ed., Toward a New World Trade Policy: The Maidenhead Papers (Lexington, Mass.: D.C. Heath and Co., forthcoming 1975)Google Scholar.

¹¹ Baldwin, Robert E. and Mutti, John H., “Policy Issues in Adjustment Assistance: The United States.” in Huges, Helen, ed., Prospects for Partnership (Baltimore, Md.: The Johns Hopkins Press, 1973)Google Scholar.

¹² See also Magee, Stephen P., “The Welfare Effects of Restrictions on U.S. Trade”, in Brookings Papers on Economic Activity 1972 (Washington, D.C: The Brookings Institution, 1973)Google Scholar.

¹³ Another pro-free trade implication of giving greater weight to future generations than the free market does is that the short-run adjustment costs of tariff cuts become less important in assessing net welfare changes.

¹⁴ Using an import-demand study by Ball, R. and Marwah, K. (“The U.S. Demand for Imports: 1948–58”, Review of Economics and Statistics, 11 1962: 395–401)Google Scholar, the industries were divided into semimanufactures and manufactures and assigned elasticities of -1.64 and -4.04, respectively, for both the import and export side.

¹⁵ Direct and indirect labor coefficients by industry for each of the six skill groups were based on the Bureau of Census, 1/1000 Sample of the Population of the United States, 1960, and 1958 employment data by industry furnished by the US Department of Labor.

¹⁶ The elasticities assumed for the five groups are, respectively, -1.0, -1.5, -2.0, -3.0, -4.0. An alternative set of elasticities were also used that varied between the countries involved in the manner suggested by Balassa, Bela, Trade Liberalization Among Industrial Countries (New York: McGraw Hill, 1967), p. 190Google Scholar. The highly elastic and elastic groups were assigned the elasticities for finished manufactures used by Belassa; the relatively elastic and relatively inelastic, his semimanufactures elasticity figure; and the inelastic group, his crude materials elasticity coefficient.

¹⁷ It should be noted that the final offers were modified somewhat from the initial offers. Besides the direct price effects of the tariff cuts, the trade repercussions include estimates of the reduction in the trade diversion impact of the EC and EFTA.

¹⁸ The estimates calculated by using the other set of elasticities are: US, –358; EC, 50; UK, –122; other EFTA, –155; Japan, 182; Canada, 36; developing countries, 169; and all other, 197.

¹⁹ The trade effects of tariff reductions are, of course, relevant to a discussion of intercountry income shifts only because they are likely to be correlated with short-run employment changes in the countries. A longer run measure of the real income effects caused by the duty reductions would be the increase in consumer surplus in each country. For the variable elasticities model, estimates of such gains as a result of the Kennedy Round, expressed as a percentage of dutiable imports, are as follows: United States, 2.4 percent; EC, 1.7 percent; UK, 3.5 percent; other EFTA, 2.1 percent; Japan, 1.7 percent; Canada,.04 percent.

²⁰ See Herbert Geirsch, in Bergsten, ed., Toward a New World Trade Policy: The Maidenhead Papers.

²¹ Mill, J. S., Principles of Political Economy, vol. 2 (London: J. W. Parker, 1888) p. 308Google Scholar.

²² For proposals to this end, see Bergsten, C. Fred, Completing the GATT: Toward New International Rules to Govern Export Controls (Washington, D.C.: British-North American Committee, 11 1974)Google Scholar.