Introduction

Economic integration is a broad concept in which two or more economic entities have become increasingly interdependent through a lengthy and complicated process. It is not an easy task to describe economic integration because there is no unique explanation and standard understanding of its meaning. Various specifications, such as the negative and positive integration used by Tinbergen (1954), Holzman’s (1976) price equalization, or Mennis and Sauvant’s (1976) and Pelkmans’ (1984) removal of economic boundaries and elimination of economic frontiers, have been introduced in defining economic integration. In general, economic integration is interpreted as the elimination of economic impediments in trade and investment, or the liberalization of factor markets, as well as the improvement in resources allocation between different economic entities. For this reason, it is necessary to consider a series of economic factors, such as the similarity in economic structure, as well as the development and intensity of trade and investment activities, so as to assess whether the economies under consideration have become increasingly interrelated. It is then possible to conclude whether a certain amount of economic integration has been achieved.