This paper is a short, non-technical exposition of the political economy of protection. It asks how do political forces operate to generate protection, and what determines the magnitude and form that protection takes.

ContributorsIntroduction, Dominick Salvatore, James W. Dean, and Thomas D. WillettPart I. General AnalysisA Visionary's View1. Currency Areas, Exchange Rate Systems, and International Monetary Reform, Robert MundellDe Facto Dollarization2. Unofficial Dollarization in Latin America: Currency...

There has been much interest in whether fixed exchange rates can provide a strong source of discipline over domestic monetary and fiscal policies. We argue that previous studies, however, have not paid sufficient attention to the distinction between constraint and incentive effects and that...

Large global economic and financial imbalances have already contributed to the global financial crisis and the euro zone crisis. A substantial retreat into protectionism may be generated. Huge current account surpluses and deficits have caused economic and financial dislocations in both emerging...