Economic Globalization and the Nation-State: Shifting Balances of Power

Abstract

Economic globalization is an idea that has been around long enough to ensure that much of its original analytical promise and explanatory potential has been drowned by hype and tarnished by overinflated claims. In some of the more extreme positions, which we refer to as hyperglobalization, it has been argued that we now live in a world in which social processes and institutions operate predominantly at a global scale. National economies, in particular, are immersed in a sea of global flows and are overrun by global economic actors. As a consequence, significant differences between national economies are being eroded as a homogeneous global economy emerges. Above all, the claim is made that the sovereignty and autonomy of nation-states has been radically reduced. These claims have often been associated with neoliberal positions that welcome the emergence of truly open and free global markets in capital and goods (though, interestingly, not in labor), celebrate their efficiency, and delight in the corresponding diminution of an essentially malign state power. These normative and empirical claims have provided tempting targets for the more skeptically minded and those less sympathetic to the neoliberal project. Casual empirical inspection reveals that for all the increases in global flows of trade and investment, the majority of economic activity continues to occur on a more restricted spatial scale. Historical evidence suggests that contemporary forms of international economic interaction may actually be less than those witnessed in the late nineteenth and early twentieth century - the goldstandard era. When measured against the liberal ideal of open global