Question

Chapter 3 - Regional Economic Integration What are the economic and political arguments for regional economic integration? Given these arguments, why don't we see more integration in the world economy? Select a current global business event relating to Brexit from a news source, such as electronic local newspapers, New York Times, International Business Times, Economic Times, or CNN News. Provide a summary of the article, relating to the material you have read in chapters 1, 2, and 3. Include an explanation of what you learned in this article and if you agree with the author's perspective.

Answer 1

Regional Economic integration is much sought after objective world over, Following are its benefits:

• it leads specialisation and over all production in region rises up significantly,
• Consumers find it beneficial as rise in production leads to fall in prices of goods and services. so overall welfare of community increase.
• Integration leads to fall in tariffs and non tariffs barriers and costs of production fall substantially.
• Economic integration facilitates the amicable political relationships. Thus, political conflicts get reduced through economic integration, countries becomes dependent on each other so they seek to avoid any conflicts.

Although, economic integration leads to numerous benefits but still few economic integrations are seen real world. Brexit is an example of crumbling economic integrations. Following are reasons for few economic integrations:

• Economic disparity between member countries also making economic integration fragile. Few countries garner benefits at the cost of other or weak countries. Thus, UK which was not finding economic integration beneficial moved away from it.
• Further, excessive economic integration challenges the sovereignty of country.