Abstract

As a result of the rise in the value of the dollar against most other currencies, U.S. manufacturers are threatened at home by an unprecedented influx of imports and abroad by increasing uncompetitiveness of U. S. exports. The problem of adjusting to competition from lower-cost exporting countries is not a phenomenon exclusive to the U.S.: Western European producers, particularly those in mature manufacturing industries, have also been forced to adjust to low-cost competition. This review of responses by European manufacturers to import penetration identifies a number of adjustment strategies and examines the consequences of different strategies for competitive performance.