DP9040 Who Needs the Nation State?
|Publication Date:||July 2012|
|Keyword(s):||Globalization, Nation State|
|Programme Areas:||International Macroeconomics, Public Economics, International Trade and Regional Economics|
|Link to this Page:||cepr.org/active/publications/discussion_papers/dp.php?dpno=9040|
The design of institutions is shaped by a fundamental trade-off. On the one hand, relationships and heterogeneity push governance down. On the other, the scale and scope benefits of market integration push governance up. A corner solution is rarely optimal. An intermediate outcome, a world divided into diverse polities, is the best that we can do.