Economic integration is the process of harmonizing two markets into one.
Depending on how you count, there are anywhere from four to six stages. "Universally" recognized stages are listed in bold, whereas "non standard" stages are not.
- Preferential Trade Area (PTA)
- Free Trade Area (FTA)
- Customs Union (CU)
- Common Market (CM)
- Economic Union (EU)
- Monetary Union (MU)
For the sake of clarity, some shortcuts will be made. First, though technically the list is inclusing, so an EU is also a CM, and an MU is a PTA, this will be ignored to make the write-ups clearer. Additionally, these agreements go far beyond "tarrifs" into other trade barriers. However, addressing these would make the write-ups to complex for me to write lucidly.
Also, all nodelets mention "the most successful _blank_ in history." The criterea used is strength and endurance. So the German Customs Union, which was ulimately disastrous for the peoples of Europe, is "successful," while the African Union, which is great on paper but impotent in reality, would be an abject failure.
All write-ups in this node and its nodelets are my own. However, much information was distilled from International Trade & Finance lectures from Dakota State University and Steven Suranovic's article, "Economic Integration: An Overview," published in InternationalEcon.com.