Working Paper: CEPR ID: DP9040
Authors: Dani Rodrik
Abstract: 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.
Keywords: globalization; nation state
JEL Codes: F0; H41
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| nation-state (F55) | global distribution of income (D31) |
| country of birth (J19) | economic fortunes of individuals (D14) |
| nation-state (F55) | global inequality (F63) |
| national identity (F52) | local/global affiliations (F53) |
| nation-state (F55) | economic progress (O49) |
| nation-state (F55) | governance for markets (D47) |
| national governance (H10) | economic integration (F15) |
| national governance (H10) | social welfare (I38) |