Text: Molle, "The Economics of European Integration" (ed. 2).  Besides
readings from the text, you will be responsible for current European
economic events, for instance as they are reported in the European
economic events, for instance as they are reported in the "Financial
Times" and "The Economist."  Copies of these are held on reserve in the
West European Studies Library, Ballantine 542.  We are also well supplied
with free materials from the EU.  There will be two examinations.
Students in E390 and W405 have the option of replacing the final
examination with a final paper, on a topic of interest, as defined
jointly by the student and the instructor.

Week I.  (Molle, chapters 1-3) What is Europe?  The 5 divisions of
Europe.  Rich and poor Europe.  What is economic integration?  The
integration?  The integration process worldwide--3 big blocs.  Some
useful acronyms (E.C., EU, EFTA, EEA, WEU, NATO).  National vs. European
identity.  The migration equation.

Week II.  (Molle, chapter 4) The constitution of the EU.  The four
pillars of the EU: the Commission, the Council, the Court, and the
Parliament.  Analysis of recent election results.  Alternative aspects of
the EU: economic, political, monetary.

Week III.  (EU handout; Gardner paper) The cost of the EU.  Sources of
revenue, impact of taxes.  Spending categories.  Principles of bargaining
as exemplified by the budget.  Fiscal constitutions and budget discipline.

Weeks IV-V.  (Molle, chapters 5-7) Theoretical benefits of a customs
union.  Economic theory of such a union.  Trade creation and trade
diversion. $bananas and other such stories.

Week VI.  (Molle, chapter 8) Theoretical benefits of a common market.
The single market since 1992.  The extent to which common market
prerequisites are fulfilled.

Week VII.  (Molle, chapter 10,12,16) Limitations of the internal market.
Capital still not mobile.  Restraints of trade and other forms of price
fixing.  The cases of cement and steel.  Industrial policy and
competitiveness.

Week VIII.  Review session and first examination (30 Oct.)