Internationalization, institutions, and political change

Many analysts associate internationalization of markets with wide-ranging changes in domestic politics. An “open polity” approach shows how extant domestic institutions mediate in this relationship between internationally induced changes in domestic actors' policy preferences, on the one hand, and national policy and institutional outcomes on the other. The nature of labor unions and formal political institutions often results in political outcomes that differ significantly from those that would ensue if outcomes simply mirrored preference changes. In addition, while existing institutions may sometimes constrain governments from pursuing policies that would improve long-term economic performance, governments will often fail to change these institutions because of short-term political considerations.