The two decades after 1950 witnessed a global increase in the volume of international trade which far outstripped the increase in world output. This phenomenal expansion was facilitated by relaxations in controls both on trade itself and on international payments. Western European countries were major participants in this economic expansion, registering unprecedented rates of growth in trade and output. This ‘golden age’ came to a sharp end in the early 1970s, when the post-war payments system disintegrated and protectionism returned as a tool of trade policy. Although avoiding a return to controls on trade among themselves, the economic performance of western Europe in the two decades since 1970 has been much more uneven.
