What is integration and what are its variations?
Today, the term “integration” is often found in scientific literature and journalism. He firmly entered into the use of speech as historians, politicians, journalists, and ordinary citizens. But what is integration?
Analyzing the scientific literature, we can conclude what integration is in the understanding of researchers. This word is called a very complex, multifaceted, impartial process, which is replete with searches, political, financial, social, legal, economic contradictions, which are caused by life.
Integration, speaking of the results of its development, is the highest economic, social, state, legal, cultural and political stage of development of the entire world community of peoples and countries.
For the very concept, in view of its complexity, there is no one precise definition. This is quite understandable, because, firstly, there are a huge number of models and types of integration processes that differ in their functions and goals, and secondly, there are different state interests,who are pursuing groups of countries or individual countries.
What is integration? In the aggregate, this is the creation of a new super-system, as general as possible, which may appear on the basis of the connection of some subsystems that interact with each other. At the same time, common functions are combined, it is possible to solve joint tasks, strategies and programs for joint development in various fields and areas are developed. Ultimately, this leads to a partial or complete merger.
This basically refers to such a concept as “international integration”, but this term can even refer to small business. There are several main types of integration.
What is horizontal integration? This is the process of bringing countries or companies closer together:
- are at similar stages of development, on “one link”;
- able to work and compete in the same sectors of the market, in some industries;
- specialize in the production of similar kind of products.
This type of integration is associated with an increase in the so-called share of an enterprise or country. So you can minimize the loss of profits.
What is vertical integration? In this process, the company is joined by other companies associated with the main technological chains. Ultimately, there is the establishment of full control of the parent company over its subsidiaries. The same applies to interstate relations.
It is a process of association between enterprises or states that are at different levels of development and are focused on different products.
What is integration in the economy? Naturally, without taking into account the financial sector, this process is simply impossible in the modern world. Thus, economic integration at the macroeconomic level is a process of interaction between countries, which leads to convergence of economic mechanisms and takes the form of agreements at the interstate level, which are coordinated and regulated by the bodies of interstate law. Prerequisites for such a process are: comparability of the level of development of the participating countries, geographical proximity, common problems and interests, market reforms.