Economic Integration in South Asia: An Exploratory Study. By Ayubur Rahman Bhuyan. Dacca: The University of Dacca. 1979. Appendix; Bibliography; Index. xi + 224 pp.US S 12.00 or Bangladesh Taka 125.00.

In the book under review, Dr. Ayubur Rahman Bhuyan has made acommendable effort to analyse some of the economic effects of a"possible" customs union among the South Asian countries: India,Pakistan, Bangladesh and Sri Lanka. While an attempt has been made toquantify the static effects of integration, the rest of the analysis ismostly qualitative. In spite of the limitations imposed by the paucityof data, Dr. Bhuyan's scholarly discussion goes a long way to bring therelevant issues to light. Before going into empirical estimation of thegains and losses of a customs union among the South Asian countries, theauthor provides a rationale for economic integration among developingcountries in terms of the theory of customs unions. He bases his casefor economic integration on the need for industrialization. In line withthe argument advanced by Johnson as well as by Cooper and Massell, heconsiders industrial production to be a "public good" which yields tothe community satisfaction over and above that obtained through privateconsumption of industrial products. Industrialization of anunderdeveloped country is believed to be virtually impossible in theface of an open competition with developed countries. Hence the need forprotection. However, protection has a cost to the economy. Integrationis likely to reduce this cost by making available benefits of economiesof scale and external economies, thereby bringing about an improvementin productive efficiency.