PAUL KRUGMAN is Professor of Economics at Princeton University, USA, where he regularly teaches the Principles of Economics course. Prior to his current position, he taught at Yale, Stanford and MIT. He also spent a year on the staff of the Council of Economics Advisors in 1982-83. His research is mainly in the area of international trade, where he is one of the founders of the 'new trade theory' with its focus on increasing returns and imperfect competition. He also works in international finance, with a concentration in currency crises. In 1991, Krugman received the American Economic Associa