Introduction

The analysis of the effects of economic integration schemes has been primarily directed to their (static) resource allocation implications. There has always been considerable awareness of the dynamic developmental consequences of discriminatory trade liberalisation and limited policy harmonisation measures involved in economic integration schemes. The long-run developmental implications of economic integration have been extensively discussed with reference to schemes involving the formation of customs unions and free-trade areas among developing countries but inadequately analysed in cases of economic integration involving countries at unequal levels and at different stages of development. Adherents to the (Latin-American) dependency school of development economics and other neo-Marxist economists have stressed a number of regressive effects of processes involving market integration between developed countries and less-developed ones whose lack of a host of external economies makes them particularly vulnerable to competition from their stronger partners.