The State of North American Integration
Case Synopsis
This piece offers an overview of the state of North American integration as of 2003, but goes further to construct an index of integration, so that the analysis has greater relevance for those who want to do comparative analysis with other integrating regions, most notably Europe. Rather than focusing purely on trade flows, which classic analyses of regional integration use as their bellwether measure, the authors instead look at infrastructure, and argue that if anything, North America is perhaps more integrated as an economic system than Europe. In their conclusion, the authors are particularly interested in opening up discussion of the empirical and theoretical question, “One market, one money?” This, in turn, leads to a normative question – should North American adopt a common currency? – and a policy question – if so, how? While not offering any definitive answers, this essay looks this politically charged issue squarely in the eye and challenges the reader to examine the political and economic assumptions we have regarding the costs and benefits of regional integration.
Teaching Plan
This piece is a good starting point for a structured debate on the issue of North American monetary union. Students could be split in two groups, pro and con, and analyze the arguments and counterarguments made by the authors at the end of the piece regarding the idea of “One Market, One Money.” They could then be charged to research the issue, and conduct an in-class debate with a written brief submitted as well.
Questions for Discussion
This essay can serve as a jumping-off point for a classroom discussion/debate on the issue of currency – why monetary union has become the “gold standard” (so to speak) for regional integration, why it is such a politically fraught issue, and what variations on this policy option can be considered.
Here are a few discussion questions that might be relevant for a political science or political economy class:
- What choices did Europe make at similar historical junctures in its integration process? What options were considered, and how did the current system of adopting the Euro emerge?
- Europe is currently “widening” to admit more members, many of them poorer former Communist countries of Eastern Europe. How does this process compare with a possible inclusion of Mexico in a zone of common currency in North America?
- Why has the UK resisted adopting the Euro? Compare these reasons with Mexican and Canadian anxieties around dollarization. Are these concerns simply “irrational,” or do these political sensitivities over sovereignty have some basis in economic reality?
Relevant Courses
Apart from courses on NAFTA and North American integration, this essay could bring “North American” content and enhance theoretical discussions in courses in the following subjects:
Political Science
- International Political Economy: units on trade liberalization and regional economic integration, globalization; also useful for discussions of monetary policy on the national and regional scale.
- Methodology: could be used to spark discussion of measurement issues in IPE, in particular how one measures economic integration and what ways these measurement biases reinforce normative views of “more” and “less” integrated regions.
- European Union courses: This piece challenges both the notion of Europe’s “superiority” as an integrated region, and the way in which that integration is measured.
Useful Links from PNA
- A case for the three amigos
- Bon Anniversaire NAFTA: The Elusive and Asymmetrical Benefits of a Decade of North American Integration
- Building a Secure and Competitive North America
- Continental existentialism
- Integration: Process, Condition, or Doctrine?
- Invigorating North American Integration
- It's time to talk about North American integration
- North America at Two Speeds
- North America’s Second Decade
- Obama's Arrival Sets North American Integration Adrift
- Taking a Fresh Look at North American Integration: Mapping the New North American Reality
- The Idea of North America (online video)
- The North American Free Trade Agreement and North America
- Toward a big North American idea
Suggested Bibliography
Clarkson, Stephen (2008). Does North America Exist? Governing the Continent After NAFTA and 9/11. Toronto, ON: University of Toronto Press; Washington, DC: Woodrow Wilson Center Press.
Clement, Norris C., Gustavo Del Castillo Vera, James Gerber, William A. Kerr, Alan J. McFadyen, Eduardo Zepeda, Diana Alancon (2000). North American Economic Integration: Theory and Practice (New Ed edition). Cheltenham, UK: Edward Elgar Publishing.
Corsi, Jerome R. (2007). The Late Great U.S.A.: The Coming Merger with Mexico and Canada. Los Angeles, California: WND Books, July 4.
Den Tandt, Michael (2006). "U.S. Envoy Credits Bush-Harper Chemistry." The Globe and Mail, April 29, Pg. A4.
Drache, Daniel (2008). Big Picture Realities: Canada and Mexico at the Crossroads. Waterloo, ON: Wilfred Laurier University Press.
Hakim, Peter and Robert E. Litan, eds. (2002). The Future of North American Integration: Beyond NAFTA. Washington, DC: Brookings Institution Press.
Harris, Richard G. (2001). North American Economic Integration: Issues and Research Agenda. Ottawa: Industry Canada, April 2001.
Hill, Steven (2006). "Time for a Tex-Mex Marshall Plan." The Washington Post, April 23, B07.
Hufbauer, Gary C. and Jeffrey J. Schott (2004). "The Prospects for Deeper North American Economic Integration: A U.S. Perspective." Toronto: C.D. Howe Institute, Commentary, no. 195, January.
Huelsemeyer, Axel (2004). "Toward Deeper North American Integration: A Customs Union?" Orono, ME: Canadian-American Center, University of Maine, no. 59.
Martin, Pierre (2006). "Undefended Against Fear: Beeded Up Security at the Canada-U.S. Border Presents Immense Economic Hurdles." National Post , July 5, Pg. FP15.
North American Agrifood Market Integration Workshop (2008). "Contemporary drivers of integration." Cancun, Mexico: University of Guelph. Texas A&M University, Instituto Interamericano de Cooperación para la Agricultura-México.
Pastor, Robert A. (2001). Toward a North American Community: Lessons from the Old World for the New. Washington, DC: Peterson Institute, August.
Phinnemore, David and Alex Warleigh, eds. (2009) Reflections on European Integration: 50 years of the Treaty of Rome. New York: Palgrave Macmillan.
Ramirex de la O., Rogelio (2002). "Mexico, NAFTA and the Prospects for North American Integration." Toronto: C.D. Howe Institute, Commentary, no. 172.
Studer, Isabel and Carol Wise, eds. (2007). Requiem or Revival?: The Promise of North American Integration. Washington, DC: Brookings Institution Press.
From: Study Group on North American Financial and Monetary Integration
In cooperation with the Government of Quebec and HEC-Montreal
Chaired by Martin Coiteux (HEC-Montreal)
Published in a dedicated issue of Management International (Fall 2003)
Note: PNA is committed to encouraging intelligent discourse among our members. Comments are moderated by PNA, in accordance with the PNA Comment Policy. PNA does not necessarily endorse any of the views posted below.
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