Economic globalization is a “set of processes leading to the integration of economic activity in factor, intermediate, and final goods and services markets across geographical boundaries and the increased salience of cross-border value chains in international economic flows.”
Source: Introduction to Aseem Prakash and Jeffrey Hart, eds., Globalization and Governance (Routledge:1999)
Will Territorial Based Systems Become Obsolete?
No (short answer)
Territorial-based systems may become less important relative to others but it is more likely that more complex relationships among governance systems at different levels of aggregation -- local, national, regional, etc. -- and nonterritorial governance systems will have to be established.
Neoclassical (industrial policy is bad and counterproductive)
Regulatory State (regulation necessary for markets to work properly, but industrial policy is still bad)
Developmental State (industrial policy is useful for catching up)
Competition State (industrial policy has to take globalization into account)
The Developmental State vs. the Regulatory State Developmental Regulatory Type of Bureaucracy Elite, Insulated Transparent, Accountable Support for New Industries Extensive Limited Use of State-Controlled Banks Extensive Limited Stance w/regard to Private Firms Tutellary Regulatory