An original and systematic synthesis of the major postwar developments in theory and policy of balance-of-payments adjustment, this book focuses on the present-day system of pegged-but-adjustable exchange rates and the problems that policy authorities must face if they are to attain full employment, price stability, balance-of-payments equilibrium, and a satisfactory rate of economic growth. The dominate theme of this book is that any system of exchange rates carries with it assumptions about the way it works and how effective the automatic and policy-motivated forces operate to bring about equilibrium in a country's balance of payments. By analyzing balance-of-payments adjustment and policies under alternative exchange-rate systems, and with different assumptions concerning the level of employment and prices, it is possible to embrace a wide variety of contemporary and historical circumstances experienced by individual countries and the world as a whole. In this way the author assesses the economic consequences of the different exchange-rate systems and of the policies that countries may follow to attain their national objectives. In particular it appears to Professor Stern that the international monetary turmoil of the past ten years can be traced to the exchange-rate inflexibilities of the adjustable-peg system and to the creation of excessive reserves under the dollar standard. He demonstrates that the international monetary system must be redesigned to permit greater exchange-rate inflexibility and control over the creation of new international reserve assets. -Stern's The Balance of Payments is a welcome addition to the textbooks in the area of international monetary economics. Written at the graduate level and heavily oriented to a survey of the 'state of the arts, ' the book should be in the library of every serious student of international economics. . . . Any economist desiring an exposition of international monetary economics should read this book, and all serious practitioners of the subject will want to have the volume readily at hand.- --Lawrence H. Officer, The Journal of Finance -Professor Stern presents good and. . . original treatments on the use of important restrictions, the assignment rule, and growth and the balance of payments. . . . Stern has given the profession a most valuable text and reference work.- --G. C. Hufbauer, The Economic Journal -This book provides a lucid survey of the large and ever-growing literature on the balance-of-payments. . . . The exposition combines complex graphical analysis with relatively simple algebra with a very happy effect.- --H. Peter Gray, Economica -Stern's book is in many ways exemplary. . . . Stern has given us a comprehensive and useful summary of the international literature as it exists.- --Paul Wonnacott, Journal of Economic Literature "Stern's The Balance of Payments is a welcome addition to the textbooks in the area of international monetary economics. Written at the graduate level and heavily oriented to a survey of the 'state of the arts, ' the book should be in the library of every serious student of international economics. . . . Any economist desiring an exposition of international monetary economics should read this book, and all serious practitioners of the subject will want to have the volume readily at hand." --Lawrence H. Officer, The Journal of Finance "Professor Stern presents good and. . . original treatments on the use of important restrictions, the assignment rule, and growth and the balance of payments. . . . Stern has given the profession a most valuable text and reference work." --G. C. Hufbauer, The Economic Journal "This book provides a lucid survey of the large and ever-growing literature on the balance-of-payments. . . . The exposition combines complex graphical analysis with relatively simple algebra with a very happy effect." --H. Peter Gray, Economica "Stern's book is in many ways exemplary. . . . Stern has given us a comprehensive and useful summary of the international literature as it exists." --Paul Wonnacott, Journal of Economic Literature "Stern's The Balance of Payments is a welcome addition to the textbooks in the area of international monetary economics. Written at the graduate level and heavily oriented to a survey of the 'state of the arts, ' the book should be in the library of every serious student of international economics. . . . Any economist desiring an exposition of international monetary economics should read this book, and all serious practitioners of the subject will want to have the volume readily at hand." --Lawrence H. Officer, The Journal of Finance "Professor Stern presents good and. . . original treatments on the use of important restrictions, the assignment rule, and growth and the balance of payments. . . . Stern has given the profession a most valuable text and reference work." --G. C. Hufbauer, The Economic Journal "This book provides a lucid