## Saturday, May 31, 2008

### Globalisation and the nation state

Much of the present narrative tends to treat nation states that throw up high walls as the default setting. A new idea called globalisation is seen as being about breaking down barriers imposed by the nation state against the freedoms of individuals on the movement of ideas, goods, services, capital and labour. Barriers are normal, globalisation is novel. This perspective is based on looking at the post-war experience.

Nikolaus Wolf has an article European economic integration: Undoing 1914-1945 on voxeu where he looks at `the division of labour in Europe'. His main story is about the German economy, where natural economic forces produced integration with Europe (i.e. globalisation) and not within Germany. It took quite a prodigous effort for the nation state to force Germany to trade within Germany. In a larger historical perspective, globalisation is the natural state, and nation states that throw up barriers against it the temporary aberration.

#### 1 comment:

1. Hi Sir,

In case you haven't, maybe you'd like to read the article (link to which i've pasted below).

It talks on the huge impact rising crude prices can have on global trade, which so far seem to have been driven by labour arbitrage btwn the developed and the developing world.

The note claims that a USD 150 per barrel cost of crude oil is equivalent of a 15% import duty (in terms of higher transportation costs).

Please note: LaTeX mathematics works. This means that if you want to say $10 you have to say \$10.