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A Note On De-Homogenizing Economic And Political Integration From A Praxeological Perspective

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  • Matei Alexandru Apăvăloaei

    (Bucharest University of Economic Studies)

Abstract

This paper is going to analyze and de-homogenize two distinct phenomena: economic integration and political integration. On the one hand, this paper is going to restore economic integration to the scope of economic science. The essence of economic integration consists in the extension and intensification of the division of labor, a self reinforcing process that originates in the voluntary interaction between individuals. All we can infer from a theoretical perspective is that: at all times, in an unhampered market, all entrepreneurial projects, from all regions, are going to push specialization, and, therefore, economic integration to their praxeologically relevant limits. Based on this insight and on the counterfactual approach of property economics, we concluded that any other standard that is used to analyze economic integration, like perfect competition or the general equilibrium, is arbitrary. Furthermore, any attempt to bring the real economy closer to such a standard, can only be done through the use of the political means and therefore can come only at the expense of the entrepreneurial market order and of the praxeologically relevant limits of economic integration. On the other hand, political integration originates in coercive interaction, and it represents a manifestation of political cooperation. Political integration is an option that policymakers can choose to adhere to in their attempt to limit international political competition, alleviating its effect on the economic and ideological limits of political action. From an a priori perspective, all we can say about political integration is that, in case policymakers decide to pursue it, it will postpone the moment when the limits of political actions are reached, but it will do so at the expense of the division of labor. Therefore, not only are political and economic integration, by their very nature, distinct phenomena, but the first can only come at the expense of the latter.

Suggested Citation

  • Matei Alexandru Apăvăloaei, 2016. "A Note On De-Homogenizing Economic And Political Integration From A Praxeological Perspective," Review of Social and Economic Issues, Romanian-American University, vol. 1(3), pages 5-56, march.
    • Handle: RePEc:rau:rseijr:v:1:y:2016:i:3:p:5-56
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    References listed on IDEAS

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    3. Baumol, William J., 1996. "Entrepreneurship: Productive, unproductive, and destructive," Journal of Business Venturing, Elsevier, vol. 11(1), pages 3-22, January.
    4. John Whalley, 1998. "Why Do Countries Seek Regional Trade Agreements?," NBER Chapters, in: The Regionalization of the World Economy, pages 63-90, National Bureau of Economic Research, Inc.
    5. Machlup, Fritz, 1975. "The History of Thought on Economic Integration," Working Papers 75-25, C.V. Starr Center for Applied Economics, New York University.
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