Lecture 11: Global Institutions and Regional Economic Integration Flashcards
1
Q
What are the 5 different forms and degrees of economic integration?
A
- free trade area
- customs union
- common market
- economic union
- political union
2
Q
What is the free trade area (stage 1)?
A
Remove barriers to trade from members but retail independence on trading policies with non-members
3
Q
What is the customs union (stage 2)?
A
Remove barriers on members trade and impose a common external barrier.
Issues: trade creation and trade diversion
4
Q
What is the common market (stage 3)?
A
Issues: differences in regulations, fiscal, monetary, industry and social policies distort flow of products, people and money
