Economic Integration of the EEC

The EEC was created with the signing of a treaty in Rome in 1957, by Belgium, France, the Federal Republic of Germany, Italy, Luxembourg, and the Netherlands (Paxton, 1989, p. 41). The European Atomic Energy Community (EURATOM) was created at the same time, by the same treaty, and with the same membership (Paxton, p. 45). Each of these organizations became functioning realities on 1 January 1958 (Paxton, pp. 41, 45). Prior to the creation of the EEC and EURATOM, the European Coal and Steel Community (ECSC) had been created by a treaty signed in Paris in 1951 (Paxton, p. 43). The ECSC was comprised of the same six member countries which formed the EEC and EURATOM, and became a functional reality on 10 August 1952 (Paxton, p. 43).

Until 1 July 1967, each of the three communities - the EEC, EURATOM, and ECSC - functioned as separate entities, although there were some common institutions. On 1 July 1967, however, the executives of the three communities were merged

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the British pound. A major benefit "of EMS is to have reduced for its members the prospect of an overshooting exchange rate . . . " (Schioppa, 1985, p. 194). The activities of the EMS were also successful in reducing the rate of inflation in the ERM countries, "if not faster than in Britain, then with less apparent cost in terms of lost output" (Artis, 1987, p. 34). Additionally, the EMS actions are credited with stimulating growth in the ERM countries. The resilience and flexibility of the EMS "has surprised even its most enthusiastic supporters" (Zis, 1984, p. 45). For all of its successes, however, the EMS does have some problems. One of those problems involves the refusal of the UK to participate in the ERM. There are two major reasons why the British have thus far refused to participate in the ERM. First, the British pound is one of the petro-currencies, because the UK is a net petroleum exporter. The British pound, as a consequence, tends to be a more volatile currency than do the seven ERM currencies. This volatility causes the Thatcher government to feel that fulfilling ERM requirements for exchange rate stability might place too much pressure on the UK economy. Second, the pound is a more widely held currency
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Some common words found in the essay are:
Standard Poor's, Financial Markets, ERM EMS, EURATOM ECSC, Single Act, FINANCIAL MARKETS, Western Europe, Socks Total, ECU EMS, ERM British, foreign investment, exchange rate, ____ ____, private sector, economic integration, financial markets, paxton 1989, ____ ____ ____, capital markets, investment private sector, european communities, investment private, foreign investment private, european monetary system, total foreign investment,
Approximate Word count = 3953
Approximate Pages = 16 (250 words per page)

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