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ECONOMIC INTERGRATION, CHARACTERISTICS, ROLES - Coggle Diagram
ECONOMIC INTERGRATION
TYPES
Free Trade Area (FTA) – Member countries agree to eliminate trade barriers (such as tariffs and quotas) among themselves but maintain their own trade policies toward non-members.
Customs Union – In addition to eliminating internal trade barriers, members adopt a common external tariff on imports from non-member countries.
Common Market – Goes beyond a customs union by also removing restrictions on the movement of labor and capital between member states.
Economic Union – Member states coordinate and harmonize economic policies, including fiscal and monetary policies, in addition to having a common market.
Monetary Union – The most advanced form, where members adopt a common currency and share a central monetary policy.
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IMPACTS
Static Effects
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Trade Diversion
Switch from cheaper non-member imports to more expensive member imports → potential efficiency loss.
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CHARACTERISTICS
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TRADE BLOCS CREATION (FTA, EU, APEC, etc)
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