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18 Cards in this Set

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