The fallacy of single-level control: Local economies in a changing global environment
Abstract The increasing centralization of national economies has created crisis conditions for growing numbers of local economies. Efforts to deal with the problem have so far been largely unsuccessful. Now, unless the internationalization of economic activity is guided by the principles of democracy and economic efficiency, it will lead to even more centralization. In the EC, for example, this will worsen the difficulties of ‘crisis regions’. A key cause of the problem is the assumption that macroeconomic control can be exercised at a single level only. The solution depends on developing a multilevel system of macroeconomic management, at subnational and supranational levels as well as the national level. A twin-track approach, localizing and internationalizing, is needed to make local economic well-being a goal of economic policy, and to help create a more environmentally sustainable world economy.