The essays in this volume are timelyand provocative. They address the key issues of the changing world economy and consider the implications ofthe erosion ofthe rule oflaw that has occurred both domestically and internationally to an increasing degree over the past halfcentury. The debates over the role of the dollar in the international econ- omy, the future shape ofthe international monetary system and the exchange rate regime, the significance ofthe U. S. twin deficits, and the rise of nontariffbarriers to world trade deserve serious attention. Atthe bottom ofthese debates lie differing conceptions ofeconomic policy and the role of government in a free society. Adam Smith's vision ofa limited democracy operating to protect persons and prop- erty has been increasinglyreplaced by a vision ofapaternalistic state that is designed to protect special interests at the expense of the larger society. Many of the contributors to this volume point to the lack oflong-run rules designed to promote sound money, fiscal integ- rity, and open markets asthe fundamental flawofmodern democratic governments. Although the authors disagree on the specific rules to adopt, the consensus is that a constitutional perspective is needed to ensure astable worldorder. Moreover,since such aperspective must bedeveloped at home before it can spread among nations,the search for optimal international policy coordination is generally seen as misguided. Many ofthe essays in this volume were initially presented at the Cato Institute's Sixth Annual Monetary Conference held in Wash- ington, D. C. , February 25-26, 1988.

Peter Bauer was an unlikely revolutionary, yet he inspired a revolution in development economics. In an environment dominated by a poverty of clear economic thought, Bauer built his theories of economic prosperity. He fought to free the poor from the tyranny of poverty. With the recent spread of anti-market, anti-trade, and anti-migration movements in many parts of the world, it is important that we take a fresh look at the way Bauer exposed the fallacies behind these protest movements. He showed them to be anti-poor and anti-people, and to be exacerbating global poverty. This volume is an attempt towards helping in introducing the ideas of Peter Bauer to a new generation of readers.