How do economics and law together constitute the foundation of modern European integration?

Answer 1

Modern European integration started with the European Coal and Steel Community:
http://en.wikipedia.org/wiki/European_Coal_and_Steel_Community
It continue with the establishment of the EEC - the European Economic Community.

Both were attempts to bind Germany economically to the rest of Europe so as to reduce the likelihood of future wars.

The thinking was that people care about their purse - Germany would not want to attack the other countries if that were to do itself economic harm. And, furthermore, the more closely ties it was economically, the closer the political and social tuies would become as well.

But in order to facilitate economic integration, there needs to be at least some legal adjustments, especially in the areas of international trade, cross-border investments, etc.

Note the paragraph at the top of:
http://europa.eu/abc/history/index_en.htm

Note also the comments on Adenaur in:
http://books.google.com/books?id=PiuAJFOwLpoC&pg=PA22&lpg=PA22&dq=binding+germany+to+europe&source=web&ots=Ir9E_JiVv2&sig=rUNs_XwX20Ay8jTZzNBP4bD7aF8