Study Guide: The European Union
Multinational market regions: groups of countries that seek mutual economic benefit from reducing interregional trade and tariff barriers
La Raison d’Etre
Successful economic union requires favorable economic, political, cultural, and geographic factors as a basis for success. Major flaws in any one factor can destroy a union unless the other factors provide sufficient strength to overcome the weakness.
Economic Factors
Every type of economic union shares the development and enlargement of market opportunities as a basic orientation; usually, markets are enlarged through preferential tariff treatment for participating members, common tariff barriers against outsiders or both.
Enlarged or, protected markets stimulate internal economic development by providing assured outlets and preferential treatments for goods produced within the customs union and consumer benefits from lower internal tariff barriers among the participating countries
Political Factors
Political amenability is another prerequisite for the development of a supranatural market arrangement, and must have general compatibility. Political elements are equally important
Geographical and Temporal Proximity
Although this category is not absolutely imperative for cooperating members of customs unions such closeliness does facilitate the functioning of a common market. More important than geographic is changing time zones. Transportation and trade are more likely to be interrelated if they are close in geographic location.
Cultural Factors
The more similar the culture the more likely an agreement is to succeed, because members understand the outlook and viewpoints of their colleagues.
FORMS OF MULTINATIONAL GOUPS
Regional Cooperation Group
The most basic economic integration and cooperation is the “regional cooperation for development (RCD)” governments agree to participate jointly to develop basic industries beneficial to each economy. Each economy makes an advance effort to
La Raison d’Etre
Successful economic union requires favorable economic, political, cultural, and geographic factors as a basis for success. Major flaws in any one factor can destroy a union unless the other factors provide sufficient strength to overcome the weakness.
Economic Factors
Every type of economic union shares the development and enlargement of market opportunities as a basic orientation; usually, markets are enlarged through preferential tariff treatment for participating members, common tariff barriers against outsiders or both.
Enlarged or, protected markets stimulate internal economic development by providing assured outlets and preferential treatments for goods produced within the customs union and consumer benefits from lower internal tariff barriers among the participating countries
Political Factors
Political amenability is another prerequisite for the development of a supranatural market arrangement, and must have general compatibility. Political elements are equally important
Geographical and Temporal Proximity
Although this category is not absolutely imperative for cooperating members of customs unions such closeliness does facilitate the functioning of a common market. More important than geographic is changing time zones. Transportation and trade are more likely to be interrelated if they are close in geographic location.
Cultural Factors
The more similar the culture the more likely an agreement is to succeed, because members understand the outlook and viewpoints of their colleagues.
FORMS OF MULTINATIONAL GOUPS
Regional Cooperation Group
The most basic economic integration and cooperation is the “regional cooperation for development (RCD)” governments agree to participate jointly to develop basic industries beneficial to each economy. Each economy makes an advance effort to