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Globalization and Political Structure / Gino Gancia, Giacomo A.M. Ponzetto, Jaume Ventura.
- Format:
- Book
- Author/Creator:
- Gancia, Gino.
- Series:
- Working Paper Series (National Bureau of Economic Research) no. w22046.
- NBER working paper series no. w22046
- Language:
- English
- Physical Description:
- 1 online resource: illustrations (black and white);
- Place of Publication:
- Cambridge, Mass. National Bureau of Economic Research 2016.
- Summary:
- This paper develops a theoretical framework to study the interaction between globalization and political structure. We show that political structure adapts in a non-monotonic way to declining transport costs. Borders hamper trade. At an earlier stage, the political response to expanding trade opportunities consists of removing borders by increasing country size. At a later stage, instead, it consists of removing the cost of borders by creating international unions. This leads to a reduction in country size. Moreover, diplomacy replaces conquest as a tool to ensure market access. These predictions are consistent with historical evidence on trade, territorial changes and membership of international unions.
- Notes:
- Print version record
- February 2016.
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