Economic security in an era of globalization: definition and provision

Abstract

Globalization has undermined the traditional definition of economic security that centered on economic vulnerability to other states. At the same time, globalization has produced a redefinition of economic security in light of the risks posed by cross-border networks of non-state actors and by the economic volatility of the new global environment. The relationship between economic globalization and undesirable economic and political outcomes must be specified precisely and assessed carefully, however. Judgements about economic security must weigh the effects of increased volatility introduced by globalization against the benefits of improved economic performance in the longer run. Institutions can offset economic insecurity through the provision of insurance, shoring up policy credibility, and guiding adaptation to the new environment. National institutions will remain central to the provision of economic security under conditions of globalization. Regional and global institutions can complement one another (and national institutions) in their alleviation of the new economic insecurity. Although some regional institutions drifted in the wake of the Asian financial crisis, new regional alternatives have emerged that promise to stake out new modalities of economic security.