Single market

As a single market a distinct economic territory is referred to in economics, which is characterized by the free movement of goods, services, capital and workers and a harmonized legal system. As this economic territory often coincides with the limits of a State, the term internal market is often used as a term for the domestic market, as opposed to the world - or export market.

For a single market, which is caused by the economic integration of different States, is - sometimes interchangeably - uses the term common market, which may also refer to a common market not yet fully realized the internal market. The currently most advanced example of the economic integration of formerly national economies of the European internal market, which was created by the European Economic Community, and forms one of the foundations of the European Union. This is also the world's largest single market, followed by the U.S., China, India and Japan.

  • 5.1 USA
  • 5.2 Japan
  • 5.3 China
  • 5.4 India
  • 5.5 Europe

Internal market as an economic and legal concept

Internal market is not just an economic system, but also a legal term. Because a single market is not created automatically by itself. He is a highly sophisticated and complex business and legal competition and benefit system, its preparation and functions often need to be enforced against a wide range of resistances by governments, companies and workers or consumers.

A perfect market requires that any transport barriers are eliminated. On the one hand, this relates to markets for Endgüter whose trade through the reduction of non-tariff barriers to trade (eg different quality standards or production standards ) must be submitted to the customs union even easier. Secondly, the most important additional element of a common market in relation to the customs union is the elimination of all obstacles to mobility for workers and capital. One speaks therefore of a free movement of the factors of production.

What is a single market?

An internal market is an area without internal frontiers for everything that should move in the economic affairs from one place to another, whether it be selling goods, job seekers, services offered or the necessary capital.

The economic events in a single market is regulated by many laws, regulations and standards, for example on types and amount of taxes, on the admission of food, on State Social Benefits and a thousand more. They are different, sometimes even opposite to intentionally large part by regulation of other domestic markets in order to protect the domestic economy from foreign competition.

A common internal market that is not yet created when two or more states themselves only pick up all duties and form a free trade area or a customs union. Even then their limits remain under state control, can not pass freely from one country to the other goods, services, capital and people, there is limited or no movement of workers, freedom of establishment for no artisans and businesses. All these restrictions must be lifted in a common internal market.

The Four Freedoms

For a single market following four freedoms must be implemented:

Free movement of goods

Free movement of goods is one of the major bases of the common market without internal borders. This is created by the Customs Union and deals with the quantitative ( person-specific ) restrictions between Member States. It is the prohibition of the granting of state aid and to the prohibition of a tax favorable treatment for imported goods and the prohibition of the export tax favored.

Free movement of persons

The freedom of movement of persons includes the free movement of workers, right of establishment of independent traders, freelancers and the companies and the free movement of non-working people as well as tourists, students and pensioners.

The freedom of movement of persons is still limited by physical, technical and fiscal barriers.

Under physical barriers is understood as the controls at the internal borders, where people are subject when crossing the border.

The technical barriers are all existing in the Member States rules and regulations, which are suitable for intra-Community passenger transport, in particular the freedom of, restrict or hinder.

With the tax barriers not only indirect taxes are meant to those goods and services in the Member States partly be charged very different, but also the direct taxes, in particular income, payroll and corporate taxes.

Free movement of services

The services cover services for a fee that is not subject to the rules on the free movement of goods, capital and on the free movement of persons, which is in particular to industrial, commercial, craft and activities of the professions.

It is important to distinguish between two cases:

Firstly, the active provision of services and on the other the passive freedom of services. In the active provision of services, the provider moves temporarily in the state of the service recipient. In the passive freedom of services to recipients of services goes to the country of the service provider.

Free movement of capital

The free movement of capital is an essential complement to the realization of other internal market measures. The area without internal frontiers is not conceivable without free movement of capital. The term capital includes both physical capital (eg, real estate, corporate investments ) as well as the money capital (securities, loans). Under capital can understand the one-way transfer of property, and financial capital from one Member State to another. In general, it involves an investment.


Basically, there are three methods for creating a single market available.

First is to adjust to the establishment of the internal market, the laws, regulations and administrative provisions of the Member States. Approximation is harmonization of national regulations. The approximation or harmonization is not a unification of national law dar. The principle of proportionality is observed. Only in exceptional cases, it is conceivable that a total harmonization is required. This might be directives, regulations or decisions. The most suitable guidelines should be that specify the target binding, but leave the design of the individual Member States.

Furthermore, be considered in individual cases, the method of integration by uniform law in the Member States. The most appropriate measure for this purpose is the regulation. A unification of law by a regulation is always advised if the mere approximation of national legislation is not sufficient to create a domestic market -like conditions.

In addition to the methods mentioned so far, a further method of eliminating barriers within the Member States shall be applied. It is about the principle of recognition. In this case, the Member States' laws, regulations and administrative provisions that have not yet aligned, are recognized as equivalent to the requirements of other member country. The principle of mutual recognition is based on the idea of the fundamental equivalence of provisions for the protection of certain goods. For example, the recognition principle has been generally established before the unification of law which was introduced by the Single European Act in the European single market by the Cassis de Dijon judgment of the European Court of Justice.

Development of economic areas


The foreign trade and global economic policies of the United States have changed dramatically in the 200 years since the founding of the country. In the period of the state and economy focused mainly on the development of the domestic economy, regardless of what happened abroad. Since the Great Depression in the thirties of the 20th century and the Second World War, the country sat for the reduction of trade barriers and the coordination of the global economic system a. Americans are convinced that trade promotes economic growth, social stability and democracy in individual countries as well as prosperity, rule of law and peace in international relations. The United States has supported trade liberalization. They were mainly involved in the conclusion of the General Agreement on Tariffs and Trade (GATT ), an international code of customs and trade rules.


Japan remains until further notice, the leading business and technology power in Asia and the United States after the second strongest economy in the world. Japan in 2007 achieved 9% of world income, more than the emerging economies of China and India. With a population of 127.2 million Japan generates a GDP of 4.7 trillion. USD (2007, in comparison Germany 3.6 trillion. USD). Due to the geographical proximity of the Japanese industry benefited particularly challenged by the economic rise of Asia. Japan's industrial uses, the markets in China and Southeast Asia not only as a production platform, but there has been able to build efficient and increasingly hedged through bilateral FTAs value networks and so strengthen their international competitiveness.


The gradual transition to an ever-increasing market orientation has released large forces of growth in China. The consistent growth policy has a spirit of optimism and thus momentum created that are likely to persist given the size of China and its catching-up potential for a long time. Since the 1980s and early 1990s, the growth rates were indeed declined somewhat, but reports the People's Republic in recent years economic data to which it is the envy of its neighbors and competitors: China is now the fourth largest economy and third largest trading nation in the world. Despite an average per capita domestic product of about $ 2500, it remains the largest developing country economic development. China has now overtaken Germany as the world export champion.


With 9% growth in the past financial year 2007 /2008 ( an average of 8.8 % in the last 7 years ), India is the world's fastest- growing China economy. With currently 1.1 billion inhabitants, it is expected to be not only the most populous country in the world until the mid- century, but also with its gross domestic product by China and the U.S. are in third place.


According to the European Commission's Internal Market has since its founding in 1993 created millions of new jobs and providing for extra wealth worth over 800 billion euros. Thanks to the internal market rules phone calls in Europe today cost only a fraction of what they were ten years ago; many air fares in Europe have fallen significantly, and many new routes were created; Households and businesses across Europe can choose their electricity and gas supplier today.