Gancia, GinoPonzetto, Giacomo A. M.Ventura, JaumeUniversitat Pompeu Fabra. Departament d'Economia i Empresa2024-11-142024-11-142016-08-01Journal of the European Economic Association, 20 (3), 2022, 1276-1310http://hdl.handle.net/10230/26843This 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.application/pdfengL'accés als continguts d'aquest document queda condicionat a l'acceptació de les condicions d'ús establertes per la següent llicència Creative CommonsGlobalization and political structure<resourceType xmlns="http://datacite.org/schema/kernel-3" resourceTypeGeneral="Other">info:eu-repo/semantics/workingPaper</resourceType><subject xmlns="http://datacite.org/schema/kernel-3" subjectScheme="keyword">globalization</subject><subject xmlns="http://datacite.org/schema/kernel-3" subjectScheme="keyword">political structure</subject><subject xmlns="http://datacite.org/schema/kernel-3" subjectScheme="keyword">size of countries</subject><subject xmlns="http://datacite.org/schema/kernel-3" subjectScheme="keyword">international unions.</subject><subject xmlns="http://datacite.org/schema/kernel-3" subjectScheme="keyword">Macroeconomics and International Economics</subject><rights xmlns="http://datacite.org/schema/kernel-3">info:eu-repo/semantics/openAccess</rights>