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18 Cards in this Set
- Front
- Back
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Maastrict Treaty
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set a date for the completion of the EU
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market economy/non market economy
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where the commercial decisions of indep. buyers and sellers govern both domestic and international trade/ where the state controls trade
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monetary union
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the unification of montetary poliy and a common currency
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common market
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a group of nations that permits the free movement of goods and services among member nations & the iniation of common external trade restrictions against non members
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convergence criteria
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economic standards required of all all nations in a MONETARY union ie price stability, low long term intreset, stable exchange rates
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countertrade
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international trade in whcih goods are exchanged for goods
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customs union
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an agreement btw nations to remove all tariff and non traiff barriers to trade btw themselves & levy identical trade restrictions on other non members
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dynamic of economic integration
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effects that relate to member nations long-run rates of growth. ie economies of scale, greater competition & investment stimulus
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economic union
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where national, social, taxation and fiscal policies are harmonized and administered by a supranational institution
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optimum currency area
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a region where it is economically preferable to have a single official currency rather than multiple
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regional trading agreement
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where nations agree to impose lower barriers to trade within the group
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static effects of economic integration
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include the trade creation effect and the trade diversion effect
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Export Subsidies
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a subsidy paid to exporters so they can sell goods abroad at a lower price but still recieve the higher price
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free-trade area
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an assoc. of trading nations whose members agree to remove tariff and non tariff barriers
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trade-creation effect
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a welfare gain resulting from increasing trade--caused by a regional trade bloc
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trade-diversion effect
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a welfare loss resulting from the formation of a regional trade bloc---when imports from a low cost supplier outside the trade bloc are replaced by purchases from a high cost supplier within the trade bloc
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transition economies
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national economies making the transition from a centrally planned economy to a market economy
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variable levies
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an import tariff that increases or decreases as domestic or world prices change to guarentee the price of the imported product after payment of duty will equal a predetermined price
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