North American Economic Integration

North American Economic Integration

Theory and Practice

Norris C. Clement, Gustavo del Castillo Vera, James Gerber, William A. Kerr, Alan J. MacFayden, Stanford Shedd, Eduardo Zepeda and Diana Alarcón

This highly accessible book explains the theoretical, historical and political background of the North American Free Trade Agreement (NAFTA), its impact and the debates surrounding its existence. In addition the authors provide a brief introduction to the theory of economic integration as well as a succinct overview of the evolution of the global economy, and the institutions that manage it, in the post World War II period.

Chapter 1: NAFTA in the Global Context

Norris C. Clement, Gustavo del Castillo Vera, James Gerber, William A. Kerr, Alan J. MacFayden, Stanford Shedd, Eduardo Zepeda and Diana Alarcón

Subjects: business and management, international business, economics and finance, international economics


Page 5  1. NAFTA in the Global Context.  Readers of this book are conscious of a trend toward increasing internationalization the of economic life as imported goods flood national markets and foreign  corporations become more noticeable. People involved in business have also become aware of the growing importance of international economic organizations such as  the World Trade Organization (WTO) and the International Monetary Fund (IMF) which have been created to coordinate the global economy. The North American  Free Trade Agreement (NAFTA) which came into being in 1994 has achieved considerable notoriety throughout the three­country region that bears its name in just a  few years.  This book tells the story of how the ongoing economic integration of Canada, the US and Mexico in the post­World War II era led these countries, in recent years, to  negotiate formal treaties — the Canadian­United States Free Trade Agreement (CUSFTA) and subsequently the North American Free Trade Agreement (NAFTA)  — that today provide a framework for facilitating and managing the expanding trade and investment flows that virtually gush over their borders.  The main actors in our story are: the US, a technologically advanced, prosperous and economically diversified country with a large population; Canada, a prosperous,  resource­ and technology­based country with a small population; and Mexico, a developing country with a medium­sized but rapidly growing population. Together  these countries comprise about 7 percent (370 million) of the world's population (approximately 5.5 billion). The setting for our story is the global economy of the...

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