First published in 1988, this study of international capital movements looks at their historical role in the financing of trade and their dramatically increased role in the world economy in recent years. It examines the current economic theory and the policy implications of these changes. Beginning with an analysis of the balance of payments, the authors goes on to discuss international short-term and long-term capital movements, both historically and with reference to current events. A further chapter deals with financial deregulation and the progression during the last few years towards the integration of international capital markets. The author looks forward to two possible futures for international finance: a gradual federalisation of macro-economic behaviour on a world basis, or a move towards self-reliance and autarky. The book is based on the author's Marshall Lectures, given in the University of Cambridge. It will be of interest to those studying international and financial economies, graduate students and those involved in the formulation of policy.