IBDP Economics Chapter 15 Notes

economic integration and the terms of trade

STUDY NOTES FOR ECONOMICS CHAPTER 15 – ECONOMIC INTEGRATION AND THE TERMS OF TRADE

These notes have specially been curated by expert teachers to simplify and enlighten concepts given in IB Economic Integration and the terms of trade HL. The notes are comprehensive in nature and are sufficient to study the chapter in depth and one need not look for other resources beyond the notes provided on our website which can be accessed for free. The notes for Economic Integration and the terms of trade IBDP HL are available on our official website and can be downloaded for free. The material made available on Tychr’s website is available for all IBDP subjects and is specially curated after an extensive amount of effort to ensure that the notes are in consonance with the IB curriculum and are an amalgamation from various textbooks prescribed by the IBO.

In this chapter we study as to how economic cooperation between countries and coordination of economic policies age in increasing economic links. There are various types of trade agreements discussed in the chapter like economic integration, preferential trade agreement, bilateral trade agreement, multilateral trade agreement and regional trade agreements. trading blocs are a group of countries that agree to reduce barriers for free trade and cooperation and some of which discuss in the chapter are free trade area, customs Union and common market. The strengths and weaknesses of the trading blocs are studied in detail in the chapter in order to help students understand the concept clearly.

Next we study in the chapter about trade creation and trade diversion.A detailed study of monetary Union which is a greater degree of economic integration is discussed in the chapter along with its strengths and weaknesses. The chapter also focuses on the terms of trade like the improvement and deterioration of trade measuring terms of trade causes of changes in terms of trade consequences of changes in terms of trade and impact of short term fluctuations and long-term deterioration in the terms of trade in economically less developed countries. A detailed study of the above mentioned concept along with formulae graph negative effects long term consequences at structure are mentioned in the chapter to help the students understand the various nuances of trade in an economy. Overall the chapter emphasizes on the importance of economic integration which has various benefits to the economy as a whole.