International business topics include economic integration and levels of integration. Economic integration impacts trade creation and diversion by changing import prices, competition, economies of scale, and factor productivity. Trade creation benefits consumers within an integrated region through lower prices and free trade, while trade diversion has negative effects. Integration can also increase market size, competition, and economies of scale by allowing industries to realize internal and external scale economies across a larger region.

1. INTERNATIONAL BUSINESS
TOPIC :
•ECONOMIC INTEGRATION
•LEVELS OF INTEGRATION
•IMPACT OF INTEGRATION
BY:
SOWMYA C N

9. IMPACT ON INTEGRATION
1. Trade creation and diversion
2. The effects of integration on
import
prices,compitetion,economies of
scale, and factor productivity.

10. 1.Trade Creation and Trade
Diversion
Whereas trade creation is
positive in moving toward free
trade, and therefore lower prices
for consumers within the
European Union, the impact of
trade diversion is negative.

11. 2.Increased Competition and
Economies of Scale
• Integration increases market size and may
result in lower degree of monopoly in the
production of certain goods and services
• Certain industries may not be
economically viable in smaller, trade
protected counties
a)Internal economies of scale
b)External economies of scale