European Union: Economic Integration and Policies

A set of vocabulary flashcards covering key terms and concepts related to the European Union's economic integration, policies, and institutions.

Economic Integration

The process of removing economic barriers between countries to foster cooperation and enhance interactions.

Goals of Economic Integration

Includes expanding markets, increasing GDP, improving competition, ending political conflicts, and increasing political weight.

Types of Economic Integration

Include preferential agreements, association agreements, free trade areas (FTAs), customs unions, common markets, single markets, and full economic unions.

Preferential Agreement

A unilateral agreement where one country reduces trade protections but may clash with WTO's non-discrimination principle.

Free Trade Area (FTA)

An agreement that removes tariffs and quotas between member countries, usually involves rules of origin.

Customs Union

Includes a free trade area plus a common external tariff applied to all member countries.

Common Market

Combines a customs union with free circulation of services, capital, and labor among member states.

Single Market

A common market that includes the removal of physical and technical borders, alongside harmonization of regulations.

Static Effects of Trade Integration

Short-term effects, including trade creation (positive) and trade diversion (negative).

Dynamic Effects of Trade Integration

Long-term consequences such as increased competition, economies of scale, and higher domestic and foreign investment.

European Economic Community (EEC)

Created by the Treaty of Rome in 1957, establishing a common market with four freedoms: goods, services, people, and capital.

Common Agricultural Policy (CAP)

EU policy aimed at supporting farmers and ensuring food security through price guarantees and subsidies.

European Monetary System (EMS)

A system created to stabilize exchange rates before the introduction of the euro.

Maastricht Treaty

Signed in 1992, it established the EU and defined the criteria for the introduction of the euro.

Single Currency

The euro, introduced to facilitate trade and economic stability among member states.

Fiscal Union

Partial harmonization of fiscal policies among EU member states, primarily to enhance economic stability.

Common Foreign and Security Policy (CFSP)

EU policy aiming to preserve peace and strengthen international security.

Trade Policy

The strategy adopted by the EU for managing trade relations and agreements with other countries.

Copenhagen Criteria

Standards established for countries aspiring to join the EU, focusing on political stability, rule of law, and functioning market economy.

Next Generation EU Fund (NGEU)

A recovery plan aimed at helping EU economies recover from the COVID-19 impact.

Emissions Trading System (ETS)

A market-based approach to controlling pollution by providing economic incentives for reducing emissions.

Carbon Border Adjustment Mechanism (CBAM)

EU's policy to impose tariffs on imports based on the carbon emissions associated with their production.

Erasmus+

EU program supporting education, training, youth, and sport across member states.

European Banking Union

A framework to ensure that EU banks are safe and sound through strict supervision and support mechanisms.

Common Security and Defense Policy (CSDP)

Part of the CFSP that allows for military and civilian missions outside EU borders to manage international crises.