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Market Integration Flashcards

(35 cards)

1
Q

This occurs when firms within the same industry

A

Horizontal Integration

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2
Q

Supply chain come together

A

Vertical Integration

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3
Q

This occurs at the International level.

A

Global or cross border integration

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4
Q

contries within a specific region reduce trade barriers

A

Regional market integration

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5
Q

agreement grant each other preferential access to
certain products by lowering tariffs or providing other favorable terms

A

Preferential trade Area (PTA)

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6
Q

Member countries eliminate tariffs and quotas on trade between them, but they
maintain independent trade policies with non-members

A

Free trade Area

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7
Q

In addition to eliminating tariffs between member states, countries in a customs union
adopt a common external tariff for non-members. An example is the Southern African Customs Union
(SACU).

A

Custom union

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8
Q

goes beyond a customs union by allowing not only the free flow of
goods but also services, capital, and labor across member countries. The European Economic Area (EEA) is
an example.

A

common market

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9
Q

countries integrate their economies to the extent of harmonizing
fiscal and monetary policies.

A

economic union

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10
Q

This is the final stage, where countries merge their economies completely,
often adopting a single currency, unified regulatory framework, and centralized economic policies.

A

Full economic integration

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11
Q

Integration promotes competition by eliminating barriers,
encouraging firms to become more efficient, and leading to better resource allocation across markets

A

Increased Efficiency and competition

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12
Q

Companies can access a larger market, which enables them to
achieve economies of scale, reduce production costs, and enhance innovation.

A

Larger market and economies of scale

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13
Q

Integrated markets often attract more foreign direct investment (FDI) because
investors are drawn to more stable, transparent, and open markets.

A

Investment Opportunities

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14
Q

Consumers benefit from access to a wider range of goods and services, often
at lower prices due to increased competition.

A

Greater consumer choice

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15
Q

Market integration often drives economic growth as a result of trade expansion,
innovation, and investment. Integrated markets help countries specialize in industries where they have a
comparative advantage.

A

faster economic growth

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16
Q

As countries integrate their markets, they may need to cede control over certain
national policies, such as trade and monetary policy, which can be politically sensitive.

A

Loss of sovereignty

17
Q

While integration boosts overall economic performance, the benefits may not be
distributed equally among all participating countries or regions, leading to potential imbalances in
development.

A

Unequal benefits

18
Q

As markets become more integrated, some industries may suffer from increased
foreign competition, leading to job losses, firm closures, or the need for retraining.

A

Adjustment costs

19
Q

For markets to integrate fully, regulatory systems and standards (such as labor
laws, environmental standards, and health and safety rules) must be harmonized, which can be a difficult
and time-consuming process.

A

Regulatory harmonization

20
Q

Integrated markets lead to greater interdependence, meaning that economic
disruptions in one country can affect the entire integrated region, as seen in the 2008 global financial
crisis.

A

Economic dependency

21
Q
  • one of the most advanced examples of market integration. It has
    eliminated most trade barriers, established a common market, and introduced a single currency (the euro)
    for many member states.
  • allows free movement of goods, services, capital, and
    labor across member countries.
A

European Union(EU)

22
Q

Working toward regional economic integration
with the AEC, which aims to create a single market and production base for its 10 member states by
reducing trade barriers and improving investment conditions.

A

ASEAN economic community

23
Q

This South American customs union, including countries like
Brazil, Argentina, Uruguay, and Paraguay, seeks to promote free trade and fluid movement of goods,
people, and improving investment conditions

A

mercosur ( Southern Common market )

24
Q

This agreement, which replaced NAFTA, facilitates
trade and investment among the three North American countries, though it does not go as far as customs
unions or common markets in terms of integration.

A

United States Mexico Canada Agreement

25
Increased global trade, digitalization, and transportation advances have made it easier for markets to integrate across borders
Globalization
26
Bilateral and multilateral trade agreements help reduce tariffs and other barriers, paving the way for market integration.
Trade Agreements
27
Advances in technology, especially in communications, logistics, and financial services, make it easier for businesses to operate across national borders.
Techonological innovation
28
Regional political alliances or economic blocs are often key drivers of market integration, as countries work together to remove trade barriers and harmonize regulations.
Political cooperation
29
Types of market integration
HVGR
30
Stages of market integration
PFCCEF
31
Benefits of market integration
ILIGF
32
CHALLENGES OF MARKET INTEGRATION
LUARE
33
EXAMPLES OF MARKET INTEGRATION
EAMU
34
FACTORS OF MARKET INTEGRATIONS
GTTP
35
- Separate distinct and goals - various forms and different loads - most basic form - integraed arrangement - numerous benefits - several regions and drivers
Market integration