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as for the static effects: Trade Creation: When trade b/w custom union partners increases, this implies a shift in the Union to more efficient, competitive producers Trade Diversion:When imports from the less expensive world market are replaced by imports from a higher cost/less efficient partner country within the customs union Trade expansion: When lower market prices in one partner country stimulates total domestic demand which is satisfied by increased foreign trade with another partner country
I'm not sure about the dynamic effects of customs unions beyond the fact that they include structural adjustment and economic restructuring
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What is customs union?
A customs union is a trade agreement that is organized by a group of countries in which there is an established set of tariffs only for the countries that are not included in the group. In this marketing system, the countries that set it are granted free trade among themselves.
Is istambul part of the European union?
While Turkey is not an EU member state, there are numerous treaties between Turkey and the EU. Most important among these is the European Union-Turkey Customs Union of 1996.
Will the UK leaving the European Union EU affect government relations across Europe?
It will have some effects, but not a lot. The European Union is an organisation. The UK leaving will not end their connections with other countries in Europe that are members of the European Union or other European countries. It will take time to see what the results are. There is still some uncertainty as to what will happen next.
Distinguish between a free trade area and a customs union?
A free trade area is where there are no tariffs between member nations. A customs union goes a step farther and requires all members to have the same external tariff policy to goods coming in from outside the customs union. So, if Countries A & B are in a customs union, they would both charge the same tariff on goods imported from Country C. The reason for this is to prevent imports coming into the country with the lowest tariff and then being sent to another country in the union (without a tariff). The producer can send it directly to the end nation.
Is the European union a free union?
YesAll members of the European Union have the right to leave.
