NAFTA, U.S.-Canada trade, and WTO agriculture and services negotiations are the topics covered in the current issue of the International Economic Review (IER), a publication of the U.S. International Trade Commission's Office of Economics.

The IER is produced as part of the ITC's international trade monitoring program. The program's purpose is to keep the Commission informed about significant developments in international economics and trade and to maintain the Commission's readiness to provide technical information and advice to policymakers in the Congress and the executive branch. The opinions and conclusions of the IER are those of the authors and are not the views of the Commission or of any individual Commissioner.

The current issue (June/July 2000) includes the following articles:

• NAFTA: An Optimal Currency Area? -- The increasing convergence of the NAFTA countries has stimulated a debate on the issues of adopting a common currency and forming an American monetary union among Canada, Mexico, and the United States. Of direct and central relevance to the economic suitability of such a monetary union is the concept of the optimal currency area (OCA). Criteria for an OCA are discussed in this article, as are the costs and benefits associated with forming an OCA. The bottom line, however, is more political than economic and is a function of the willingness of the potential members of an area to agree to the terms of formation.

• Interpreting "Home Bias" in U.S.-Canada Trade -- The literature documenting "home bias" in interregional trade patterns may eventually help policymakers understand the likely extent to which the U.S. economy is distinct from that of the rest of the world. This article provides a guide to possible interpretations for the empirical evidence of home bias, the plausibility of each interpretation, and its implications for policymakers.

• WTO Agriculture and Services Negotations Proceed After Seattle Conference Suspended -- A new round of multilateral trade negotiations was expected following the WTO Third Ministerial Conference in Seattle from November 30 to December 3, 1999. Instead, differences over what subjects to include in these negotiations -- as well as over the actual decisionmaking process used to pick these subjects -- led to suspension of the conference, followed by weeks of consultations among WTO members. In February 2000, WTO Members agreed to move forward with negotiations mandated under the Uruguay Round Agreements on agriculture, services, and aspects of intellectual property and government procurement, while continuing discussions on possible negotiation of other subjects.

In addition, the publication reviews U.S. economic performance relative to other major trade partners, U.S. trade performance, and economic forecasts. Comparative economic indicators for major industrialized countries are also provided.

The current issue of the IER (USITC Publication 3331, June/July 2000) will be available on the ITC's Internet site at www.usitc.gov. To request a printed copy, write to the Office of the Secretary, U.S. International Trade Commission, 500 E Street SW, Washington, D.C. 20436 or fax requests to 202-205-2104.

To be added to the mailing list for the publication, write to the Office of Economics, U.S. International Trade Commission, 500 E Street SW, Washington, D.C. 20436 or fax requests to 202-205-2340.