European Economic Integration and the Changing Structure of European Trade
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Authors
Settles, Paul
Issue Date
1991
Type
Thesis
Language
en_US
Keywords
Alternative Title
Abstract
European economic integration (EEI) is the process of
dismantling trade barriers that has been unfolding in
Western Europe since the end of the Second World War. While
having only made concrete gains in the economic sphere, the
ultimate goal is the political integration of the Old World.
Economic integration is seen as a first step on the road to
a federation of European states.
This paper surveys the history of EEI and tracks the
changes in Western European export shares, both in aggregate
as well as those of the EEC and EFTA, to see the effects of
integration on international trade.
The European Economic Community (EEC) has come to
represent the process, all but eclipsing its rival the
European Free Trade Association (EFTA). Much has been
accomplished towards formation of the Common Market between
EEC member states - internal tariffs have been eliminated,
non-tariff barriers such as national subsidies to industry
have been addressed, the legal framework for the fulfillment
of the four freedoms of the Community is taking shape. The
1992 initiative has taken the process into a new phase, the
final steps of economic integration and the first concrete
ones towards formal political integration. And the end of
the Cold War provides an opportunity for integration to
extend to the whole of the Continent, making the process
truly European.
The analysis of export shares showed the dependence of
them upon the general economic situation. The export share
of the developed world follows the economic situation
directly so that when the economy is doing well, as in the
1960's and second half of the 1980's, its share rises. When
times are bad, as in 1970's and early 1980's, its share
falls. The developing world faces the opposite situation.
When times are good their share declines, but when they are
bad their share rises. This reflects the relatively
inelastic demand for the developing worlds products, in the
main raw materials and other primary goods, as opposed to
the more cyclical demand for the finished and capital goods
coming from and going to the developed world.
Besides this, however, there has been a definite
increase in the share of exports coming from European
countries destined for other European countries over the
last thirty years, with the greatest increase during the
1960's when tariffs were being eliminated. The most
striking statistic which demonstrates this intensification
of intra-European trade is the flip flop between intra EEC
exports and extra EEC exports as a percentage of total world
exports, from 15% intra and 20% extra to the opposite.
Description
ix, 96 p.
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