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European Economic Community (EEC)

Definition

The EEC, also known as the Common Market, was an economic union established in 1957 by six Western European countries to promote free trade among its members.

Analogy

Think of the EEC like a group of friends deciding to pool their money together to buy snacks. They agree that they will not charge each other for what they eat and will share everything equally. This is similar to how the EEC worked - member countries agreed not to impose tariffs on each other's goods, promoting free trade and economic cooperation.

Related terms

Common Market: A group of countries imposing few or no duties on trade with one another and a common tariff on trade with other countries.

European Union (EU): An international organization comprised of Western European countries to promote free trade among members. It evolved from the EEC.

Tariffs: Taxes imposed on imported goods and services, often used to protect domestic industries from foreign competition.