THE openness of the US economy appears to be secularly increasing. Merchandise exports as a fraction of final goods sales averaged 4.4 % in the early I960s and rose to an average 5.8% in the early I970s. The share of merchandise imports in apparent domestic consumption of final goods rose somewhat more. Yet, only recently have efforts been made to estimate the impact of foreign trade on market performance in the United States. This study surveys recent analyses and offers theoretical discussion and econo- metric evidence on the effects