The debate about Britain’s future outside the EU is focussing on the single market and the implications of the UK leaving it.
The single market is probably the least understood element of the EU convergence programme.
The customs union – which involves setting a single tariff rate for every tangible good import into the EU – is easily comprehended.
Car imports from South Korea are taxed at any point of entry into the EU at the same rate.
The Common Agricultural Policy (CAP) sets a price for most agricultural products across EU. If they fall below that level in any EU market, the EU intervenes to drive it back to the target.
This also requires setting a common tariff for equivalent agricultural product imports. So Canadian wheat imports into the EU are taxed at the same rate whatever their entry point.
The political convergence project comprises the European Council of Ministers, the European Commission and other EU institutions.
So leaving the EU means getting out of the common external tariff, the common agricultural policy and the political institutions of the EU.
But what is the single market and why does it matter?
The single market is a vision involving all EU countries where barriers to trade in labour, capital, goods and services among EU member states are removed.
And by extension, it also involves ensuring any barriers to trade in labour, capital, goods and services with non-EU countries are the same across the EU.
Within the EU, this means creating a free market. But all trade in labour, capital, goods and services with non-EU states is regulated (but, as has been mentioned, leaving the EU means getting out of the rules governing tangible products).
Economists would regard EU policies towards trade with non-EU states as both technically and socially inefficient.
But within the EU, the single market initiative can be considered to promote efficiency in the allocation of EU resources and fair from a social point of view.
This creates a dichotomy in the critique of the EU: it can be considered to be boith efficient and fair and simultaneously both inefficient and unfair.
Free market champions and interventionists can therefore find the EU both good and bad at the same time, though for different reasons.
But what cannot be doubted is that achieving the single market requires comprehensive regulation to ensure there is a level playing field within the EU and a common approach to non-EU sources of labour, capital, goods and services.
And what also cannot be doubted is that so long as member states continue to function as sovereign entities, EU policies will always tend to be sub-optimal: some rules bad for the EU as a whole will be adopted by the EU because they are good for one, some or most member states.
The EU agricultural policy is good for economies with large farm sectors but is bad for those with small ones and for EU consumers because it raises food prices. But the EU has accepted this as the price for ensuring farm-based economies are kept happy.
The challenges facing the EU were manageable when its member states were small in number and had similar economic and social structures. It was also easier when EU rules affected limited parts of the EU economy.
The single market, however, seeks to encompass services which account for more than 80 per cent of output and employment in the UK.
In practice, the single market is an incomplete project. The single market in capital requires the adoption of a single currency which the UK has said it won’t join.
And the single market in services, which involves common standards for every service industry, is probably an impossible goal.
In reality, the single market in services only functions in finance, and even here the project is incomplete.
So the debate is mainly about the finance sector where EU rules allow a financial advisory firm based in one EU state to operate without hindrance in all other member states.
The largest centre for EU cross-border financial services is the UK and most people working in this area are based in the City of London.
It is unclear how many people employed in the UK benefit from the single market in financial services.
Some estimate it is up to 100,000 people.
And it is unclear how many of them will either be forced to stop working or to move to another EU country after the UK leaves the EU.
It could be all of them. Or it could be as few as 10,000.
Of course, many of these are high-earning and paying heavily in tax.
But it’s still a small proportion of the total: more than 30m people are working in the UK.
So the biggest myth about the single market is that it’s important.
It’s not.