The Internationalisation of Capital and the International State System

Abstract

The purpose of this paper is to try to renew the debate about the interrelationship of the internationalisation of capital and changes in the capitalist state system. It is now over 10 years since Robin Murray pointed to the growing ‘territorial non-coincidence’ between an increasingly interdependent international economic system and the traditional capitalist (or socialist) nation-state. Robin Murray based himself on the then nascent research on multi-national corporations which proved a growth industry in the 1970s and even spawned its very own U.N. specialised agency, the Commission on Transnational Corporations. Paralleling the famous remark by Kindleberger, ‘the national state is just about through as an economic unit’ (Kindleberger, 1969, p. 207), Murray posed the question ‘whether … national capitalist states will continue to be the primary structures within the international economic system, or whether the expanded territorial range of capitalist production will require the parallel expansion of coordinated state functions’ (Murray, 1971, p. 86). He received a rapid, perhaps over-hasty reply from Bill Warren who, as well as making some good points about some of the limitations of Murray’s theoretical and empirical treatment of the internationalisation of capital, was rash enough to prophecy that since the contradictions between capital and the state are essentially non-antagonistic, new international regulatory measures would quickly be forthcoming: ‘the tax authorities are rapidly getting control of the internal transfer price problem and it is clearly not going to be long before the central bankers, international organisations and State policy-making bodies chain down the Euro-dollar monster so that it is no longer available to do the bidding of the large firms’ (Warren 1971 p. 88).