Theoretical and methodological approaches to assessing integration: international experience

This article considers the theoretical and methodological foundations and experience in assessing the development of some of the most famous integration associations in the world. In modern conditions, practically no country in the world can effectively develop without interacting with other countries. Countries are united based on their political, economic, geopolitical or geoeconomic interests. To realize these interests, various integration groups are being created. Today, there are about 300 regional trade agreements in force in the world, including agreements on economic integration, on the formation of customs unions and agreements with a partial scope of action, covering a certain list of products. The goals of countries' participation in integration associations may differ depending on the level of their economic development. At the same time, successful integration associations have a "core of integration" – a country or a group of countries that are the driving force behind the integration processes. Integration potential is a combination of natural, industrial, labor, financial, intellectual and other resources of the countries participating in the integration association, the joint mutually beneficial use of which can provide an integration effect, expressed in additional benefits and advantages for the participating countries. The idea of comparing integration associations by a set of indicators is not new. Similar studies were carried out by many international organizations, research institutes, and regulatory bodies of integration associations in order to assess how the creation of this or that integration group corresponds to the interests of the international economy as a whole.

At the moment, after rapid growth, the world economy has entered a stage of "new normality" [1, p. 6]: weak growth rates in developed countries and the global economy as a whole, slowing growth in the economies of leading developing countries, a high degree of uncertainty and volatility in the commodity and currency markets, shortage of long and cheap of money.
Accelerated liberalization of trade and financial relations between countries contributed to the emergence of not only positive effects of "joint growth", but also negative phenomena of "crisis contamination".
Under these conditions, the countries searched for new sources of economic growth, which made it possible to realize national competitive advantages and minimize the risks of negative influence of external factors. Regional economic integration has become such a source. The main motive for moving forward was the search for new sources of economic growth, obtaining synergistic effects from the coordination of national regulatory actions and removing barriers to the free movement of factors of production.
The non-linearity of integration processes leads to the emergence of economic effects of different nature and scale for the countries participating in integration associations. It is noted that the higher the level of integration in the association, the more diverse the economic effects for the participating countries are. As a result, each participating country receives "its own" effect, which may be greater or less than the effect of the association partner country. The totality and synergy of these effects makes it possible to speak of integration development for association as a whole.
The very idea of comparing integration associations by a set of indicators is not new. Similar studies were carried out by many international organizations, research institutes, and regulatory bodies of integration associations. https://doi. org/10.46914/1562-2959-2020-1-4-202-207 For example, the approach proposed by the Eurasian economic сommission focuses on the degree and level of integration of countries within the association. This allows, firstly, to identify the main directions that characterize the current stage of integration and are universal for all associations, and, secondly, to determine the appropriate indicators, the values of which allow us to assess the achieved level of integration interaction between countries.
Assessment of the level and degree of integration allows you to analyze the effectiveness of integration measures and actions, identify the "strengths" and "weaknesses" of integration interaction, and develop an agenda for dialogue with other integration blocks and associations.
Interest in assessing the level and degree of integration has increased since the active development of integration processes. During the period of exclusively trade interaction, the degree of integration was manifested in the level of consistency of the customs tariff for goods being moved. Currently, regional economic integration is a complex phenomenon that includes diversified approaches and mechanisms for interaction between countries [1, p. 7]. The results of using integration mechanisms that differ in their content are integration effects that can be manifested in various areas of the country's economic development. At the same time, it is important for supranational regulatory authorities and regulatory authorities of the participating countries that the integration process can be evaluated from the point of view of the effectiveness and effectiveness of the measures taken. This makes it possible to determine at the macro level those areas and areas in which integration development lags behind the general vector of movement of the member countries of the association.
In this regard, the issues of assessing the level and degree of integration are relevant for determining the development directions of the countries participating in integration associations, forming common priorities, and building an inter-country dialogue in the "integration of integrations" format.
Taken together, the following approaches to assessing integration, which have been developed in modern scientific literature, can be distinguished: description of methods for measuring the level of integration for a specific task; construction of indicators "de jure integration" and "de facto integration"; search for acceptable approaches to the aggregation of indicators and the construction of composite indices and integration indicators.
In the context of Eurasian integration, the following areas have been studied in detail: qualitative research of individual integration processes; institutional dimension of the integration aspect; assessment of integration in selected industries; building econometric models for quantitative assessments of the prospects for the entry of certain CIS countries into integration associations. In order to measure the level and degree of integration in most cases, the indicators characterizing the general economic state of the country and the development of the main markets ("four freedoms") are analyzed [1, p. 32-33].
1. Trade flows -goods and services. Indicators of the state and dynamics of trade are key indicators of the level and effectiveness of integration processes. For example, the share of intraregional trade in a country's total trade shows the relative importance of trade within an association versus trade with the world. Another, more complex indicator is the intensity with which countries in the region trade with each other in comparison to their trade relations with the rest of the world. This indicator characterizes the displacement of the centers of regional trade between the participating countries in the integration association. It is calculated by the ratio of exports of "given" country to the "other" country with the total exports of the rest of the world to the "other" country.
2. Financial flows, including direct and portfolio investments, government revenues, which reflect, on the one hand, the state of the business and investment climate of the integration association, on the other hand, the openness and development of the financial markets of the participating countries and the integration association as a whole. To assess the level and degree of integration, indicators that assess the level of interdependence of the participating countries in the financial markets are informative. Examples of such indicators are the volume of cross-country trade in financial assets and the rate of price equalization of the same financial asset across countries; structural correlation of returns on financial assets based on the levels of synchronicity of stock prices.
3. Migration flows. The analysis of migration flows is not limited to considering only the flows of labor migrants. An important area is educational, cultural, and social migration.
The significance of the indicators is compared across countries -members of integration associations by standardizing using GDP (population in assessing migration flows) and through a percentage of the total flow. The basic idea is that there are two aspects in which bilateral flows can be meaningful for a country: either they cover a significant portion of the total flows, or they represent a significant portion of GDP.
Most international approaches to measure the level and degree of integration analyze individual indicators characterizing trade, financial or migration flows. However, integration is a complex multidimensional process. Its assessment only on the basis of individual indicators has its drawbacks. In particular, strong trade ties can exist outside of integration associations, that is, a high level of interaction in individual markets does not mean the presence of integration ties between countries.
According to the Eurasian economic сommission, the assessment of the level of integration should be carried out in a comprehensive manner -through the combination of individual indicators (processes) into a composite index. However, there is currently no methodology for measuring the composite index of regional integration that would be applied systematically and continuously [2].
Assessment of integration based on a composite index allows you to combine the results of individual processes (components of the index) into a big picture. However, in this case, there is a problem of aggregation of indicators [3]: the index values should not be excessively volatile, since the index should reflect a safe process of economic integration; the dynamics of the speaker should not be biased towards the dynamics of any of the components that form it. Therefore, the weight of any of the components doesn't have to be high in order to dominate the aggregate index.
To assess the level and degree of integration, the official bodies of integration associations, as well as (in their interests), research organizations and institutions are developing systems of indicators of integration and economic development [4]. The elements of such systems, as a rule, are methodological approaches or techniques, a set of indicators, a description of the procedure for collecting statistical data, an analysis of the values of indicators and conclusions based on its results.
For example, among the integration associations, the most significant advance in the development of a system of indicators assessing the level and impact of integration is the European Union. In the case of the EU, these indicators reflect comprehensive assessments of the results of the formation and regulation of the EU's single market and are presented in the framework of projects such as: monitoring of the single market. This monitoring is carried out by the European Commission on a regular basis and allows assessing the practical results of the creation and management efficiency of the EU single market in three dimensions: regulatory instruments, regulatory spheres, in terms of trade integration and market openness.
The Single Market has become part of people's lives, barriers have been brought down and rules simplified. Nevertheless it is not always running as smoothly as it should [5]; indicator of the effectiveness of internal markets, carried out by the European Commission. Published as part of the annual Consumer Market Monitoring Survey, it assesses the state of 23 consumer markets for goods and services in 28 EU countries, Iceland and Norway. The indicator is a composite index that shows how well a particular market meets the requirements of consumers. As input data on the indicators, the results of the consumer survey are used, weighted by the significance of each indicator, which varies depending on the market and country; financial integration in Europe, calculated by the European Central Bank twice a year. Allows you to assess the state of financial integration of the countries of the euro area, its level in the main segments of the financial market. For this purpose, two consolidated indicators of financial integration have been developed: price FINTEC (prices in four main segments: the market for money, bonds, stocks, banking services) and quantitative FINTEC (shares of cross-border asset ownership within the euro area in all assets of the euro area); index of economic integration in the EU by the United Nations University. It is the first index to measure and rank the economic integration of individual EU members. The index is designed to provide a quantifiable framework for any economic or political discussion in the European Union, so that economic events or political decisions related to European integration can be assessed globally. The index is calculated annually for two groups of EU countries. The index for the 15 "old" EU members (EU-15-Index) has determined the degree of integration for each country on an annual basis since 1999. The EU-25-Index has been calculated annually since EU enlargement eastward in 2004. The calculation methodology is based on the calculation of 25 indicators that measure the level of integration of each EU country. Thus, the system of integration indicators used in the EU assesses the level of institutional and real integration. The Intergovernmental Regional Organization of the Latin American and Caribbean Economic System (SELA) has developed a composite integration index that includes a wide range of economic, social, environmental and cultural indicators. The index is calculated for MERCOSUR, CAIS, Pacific Alliance, CARICOM and Andean Community. The calculation of the index involves the use of econometric methods to calculate the influence of each variable, in particular, multivariate principal component analysis is used for sub-indices and the integration index [1, p. 45-46].
The economic area includes indicators of mutual trade, trade openness, trade concentration (Herfindahl index), the complexity of the economic structure, as well as key macroeconomic indicators such as inflation, public debt, government spending.
Policy direction includes indicators that measure control of corruption, government effectiveness, political stability, regulatory quality, rule of law, and law enforcement.
The social sphere is measured by assessing the freedom of movement of people between countries and includes indicators: life expectancy at birth, infant mortality, government spending on health and education, poverty rate, unemployment, GDP per capita, etc.
The need to achieve sustainable development of the region's economies has also led to the inclusion of an environmental dimension, which is assessed by the intensity of the use of fertilizers, greenhouse gas emissions, the energy intensity of GDP and the consumption of substances that deplete the ozone layer.
The cultural aspect is assessed through indicators of access to information technology, tourism development, etc.
The analysis of regional economic integration of the ASEAN countries is carried out within the framework of the monitoring system "AEC 2025 Monitoring and Evaluation (M&E) Framework". The assessment is carried out in four areas of development of the integration association [1, p. 42-46]: a single market and a single production basis -characterizes the provision of freedom of movement of goods, services, investments, skilled labor and capital; includes such indicators as the average tariff for trade in goods in ASEAN countries, the share of zero tariffs in the total number of tariffs, the share of intraregional trade, etc.; highly competitive economic environment -creating a regional environment conducive to business development and innovation; contains performance indicators for the ASEAN transport system, including the World Bank Logistics Performance Index; equitable economic development -ensuring sustainable and balanced growth; contains scores for 58 individual tasks for eight policy areas to stimulate the development of small and medium-sized businesses; integration into the global economy -provides for the full integration of ASEAN into the global economy through an appropriate approach to foreign economic relations, including through the creation of free trade zones and the signing of agreements on economic partnership.
ASEAN assesses various areas of economic cooperation between the countries participating in the integration association, but at the same time, outside the analysis, there are issues of convergence of national economies within the framework of the union or summary parameters aimed at assessing individual areas of integration.
The tools for realizing the integration potential are well known. The history of the formation and development of the European Union and other integration associations contains significant theoretical and empirical experience in the implementation of joint measures [5, p. 13]. At the same time, the key issue is the choice of specific integration measures in the current economic situation. To solve this problem, taking into account the existing differences between integration associations, integration indicators are being developed that take the level and degree of integration as the main criterion for analyzing associations.