Economic Aspects of North-South Interaction

the long version

Economic Aspects of North-South Interaction analyses the macro-economic aspects of North-South interaction. The events of the past two decades underscore the ever growing macroeconomic interdependence between nations and blocs of nations. These events include the collapse of the Bretton Woods system, the oil shocks of the 1970s, and the debt crisis of the 1980s. The recognition of international interdependence has led to a burgeoning literature on policy coordination and other aspects on intra-Northern interdependence. North-South interactions take place in a highly asymmetric manner. The North wields the greater economic and bargaining power and may ignore the South in the formulation of its own macroeconomic policies, which are governed by Northern (and intra-Northern) considerations. However, these policies have spillover effects for the South, and profoundly affect Southern income, terms of trade and future growth prospects. Economic Aspects of North-South Interaction uses a variety of models to dichotomise the Northern and Southern macroeconomies along fix-price and flex-price lines respectively, and to examine issues such as the terms of trade, protectionism, the debt crisis, the environment and the emergence of Eastern Europe into an already complicated international macroeconomic system.