Lecture 28 Globalisation and the Nation-state

7/28/2019 Lecture 28 Globalisation and the Nation-state

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Politics, Power and Society

Professor Tony Heron

Derwent College D/139

[email protected]

Ext. 3554Feedback & Guidance Hours: Tuesday 1-2 & Wednesday 10-11
mailto:[email protected]:[email protected]


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Globalisation and the state

Has globalisation ended the

rise of the nation-state?

Where has state power

gone to?

And can and is anything

being done about it?


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Has globalisation ended the rise of the

nation-state?

http://www.youtube.com/watch?v=IF_7BGdo0RE
http://www.youtube.com/watch?v=IF_7BGdo0REhttp://www.youtube.com/watch?v=IF_7BGdo0REhttp://www.youtube.com/watch?v=IF_7BGdo0RE


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The 1992 ERM crisis the state versus

the market? Exchange Rate Mechanism created in 1979 to

promote exchange rate stability among EUcountries

UK joins in 1990, part of a strategy to signal toinvestors its commitment to fighting inflationi.e. macroeconomic credibility

UK enters at a relatively high rate of exchange,requiring a supportive (high)interest rate policy

Early 1992 in the midst of recession investorsbegan to doubt the UKs ability to sustain thispolicy and bet on devaluation

UK first attempted to defend sterling but laterleft the ERM succumbing to the speculativeexpectations of international finance


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What is globalisation?

The widening, deepening and speeding up of worldwide interconnectedness in all

aspects of contemporary social life .

David Held et al. 1996.


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What is the nation-state and where

does its power come?

Defining characteristics

Unified set of institutions

Territory and distinct society

Enforcement of collectivelybinding decisions

Monopoly of legitimateviolence

Seeking sovereignty

Existence of public realm

Deciding citizenship andcontrol entry

Associated characteristics

Common interests

Legitimacy amongsignificant groups

Bureaucracy and taxationpowers

Constitution and legalframework

Sovereignty is recognisedby other states(reciprocity)


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Perspectives on globalisation

Hyperglobalism

Traditional nation states have become unnatural, evenimpossible business units in a global economy

Kenneth Ohmae 1995.

The impersonal forces of world marketsare now morepowerful than the states to whom ultimate political

authority over society and economy is supposed tobelong

Susan Strange 1996.


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Scepticism

Heightened levels of internationalisation rather

than globalisation Global economy less integrated that during the

classical Gold Standard period

Regionalisation between triad rather than

globalisation Marginalisation of many developing countries

Globalisation a necessary myth


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Transformationalism Globalization is a central driving force behind rapid social, political

and economic change, reshaping modern societies and world order.

Globalisation is an essentially contingent process replete withcontradictions (Held et al. 1996)

Globalisation a long-term, but uneven and inherently uncertain,

historical process.

Existence of a single global system not evidence of global

convergence or arrival of single world society


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Globalisation and the state?

Important to

distinguish

between the

globalisation ofpolitics and the

politics of

globalisation (Hay2008)

A Global Race?


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Globalisation and the retreat of the

state

UK Public spending as a proportion of GDP (source: whitehallwatch.org)


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A race to the bottom?


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So whats going on?

Figures may hide important trends e.g.

demographic changes or redistribution of

government spending

But important theoretical link between

economic openness and high rates of

government spending

Low wages poor predictor of the destination

of FDI


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Taking globalisation seriously

Debates about globalisation and the state oftenconflate three things that, analytically speaking,are best kept separate:

a) Structuraldimension (impact of globalisation onautonomy of the state)

b) Ideationaldimension (perceived impact ofglobalisation on autonomy of the state)

c) Strategic dimension (intentional deployment of ideasabout globalisation for political purposes e.g.welfare retrenchment, low corporation tax ratesetc..)


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Has globalisation ended the rise of the

nation-state?

No compelling evidence to suggest this is the case

Though the enmeshment of states in global trade,investment and financial networks has perhapsraised the costs of policy options in certain areas

In practice, hard (but not impossible) todisentangle structural, ideational and strategicaspects of globalisation

Most tangible challenge to the states power notfrom markets or technology but from theemergence of a system of global governanceinstitutions.

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Lecture 28 Globalisation and the Nation-state