The European Payments Union (1950–58): the Post-War Episode of Keynes’ Clearing Union

Abstract

ABSTRACT This article deals with the European Payments Union (EPU), which has garnered little academic interest to this day. The EPU operated from 1950 to 1958. It involved 18 countries and was hailed as a successful experience of European integration. Owing to the international clearing procedures that characterized the institution, the EPU is usually considered to be inspired by the Keynes plan, which was the ambitious reform that the British representative unsuccessfully upheld at Bretton Woods. This article seeks to determine signs of Keynesian thought in EPU rules and the operations of this clearing union. The article also provides an assessment of the Union’s economic performance. Additionally, it aims to examine the process that resulted in dismantling the Union in 1958.