European Integration: Trade Data and Measurement Problems

Abstract

Savage and Deutsch's relative acceptance (RA) index does not actually measure nations' preferences for transactions with one another. Using a modified measure and 1928–71 data for international merchandise trade, I conclude (1) that EEC members' preferences for one another have increased only modestly since the establishment of their Common Market; and (2) that other groups of Western industrial countries have shown a greater rise in intragroup trade preferences in the same period than the EEC. There follows a discussion on the relationship between intraregional transactions preferences and regional political integration. Two conclusions are reached: (1) high intraregional transactions saliences are necessary but not sufficient preconditions for political integration; and (2) rising intraregional transactions preferences must follow political integration. Trade data suggest that, for the EEC, intraregional saliences are probably high enough to permit integration; but slowly increasing preferences suggest that only a little integration can actually have occurred.