Econometric analysis is used extensively in international economics to estimate the causes and effects of international trade, exchange rates, and international capital movements. A currency area formed in 1999 as a result of the Maastricht Treaty . Members of the EMU share the common currency, the euro . Economic development Increase in the economic standard of living of a country's population, normally accomplished by increasing its stocks of physical and human capital and improving its technology . Economic freedom Freedom to engage in economic transactions, without government interference but with government support of the institutions necessary for that freedom, including rule of law , sound money , and open markets .
Economic integration See integration Economic rent See rent .
The use of an economic policy as a sanction . Economies of scale Increasing returns to scale . EEA European Economic Area EEC European Economic Community Effect of trade This term normally refers, often only implicitly, to the effect of a change in some policy or other exogenous variable that will increase the quantity of trade. Since in trade models, trade itself is endogenous , the effects associated with a change in trade depend on what caused it. The concept that the protection provided to an industry depends on the tariffs and other trade barriers on both its inputs and its outputs, since a tariff on inputs raises cost.