Editing Customs union (section)

=== Dynamic effects ===
The customs union does not only bring static effects to member states, but also brings some dynamic effects. Sometimes, these dynamic effects are more important than the static effects, which has an important impact on the economic growth of member countries.{{what?|date=April 2025}}<ref name="Smirnov 805–811"/>

# One dynamic effect of a customs union is the large market effect (or [[economies of scale]]). After the establishment of a customs union, conditions are created for the mutual export of products between member countries. This expansion of the market promotes increases in production, which reduce costs.
# The establishment of a customs union promotes competition in the market, by allowing companies from across the union to compete on equal terms. As a result, enterprises will tend to increase research and development investment and continuously reduce [[production costs]], thereby creating a strong competitive atmosphere.<ref>{{Cite book|last1=Krugman|first1=Paul|title=Volkswirtschaftslehre|last2=Wells|first2=Robin|date=2017|publisher=Schäffer-Poeschel|doi=10.34156/9783791039237|isbn=978-3-7910-3923-7}}</ref>
# The establishment of a customs union helps to attract [[foreign direct investment]], both by increasing the size of the market and putting producers in non-member states at a disadvantage. The establishment of a customs union implies the exclusion of products from non-members.