Traditionally, we take a nationalist view of our economy. Our politics and economics are wedded in the political economy of the nation state and the nationalist economic policies. This “nationalist paradigm” is, however, showing signs of fatigue: The role of the nation state is diminishing as the economy globalizes; our national accounting systems are less effective, technology forces change; trading blocs are emerging; there is less control of exchange rates; regional economies are restructuring; and competitive environments are changing. This book poses that political jurisdictions are not economies but polities, and explores the complex and important economic implications of this thesis. In reality, metropolitan-centered economic regions are the basic economic units and the building blocks of the U.S. economy. The linked, interdependent system of local economic regions form the U.S. Common Market, which in turn thrives within a global context of mutuality and interdependence. William R. Barnes and Larry C. Ledebur's paradigm shift from the “nation as the economy” to the “national system of local economic regions” changes the framework in which we think about governance and policy and puts this book at the forefront of U.S. economic thought.

The Nation as Economy: Triumph of a Faulty Paradigm

The nation as economy: Triumph of a faulty paradigm

The economist must become a student of political science in order to answer strictly economic questions.

—Scott Greer, The Emerging City: Myth and Reality1

Most current economic thinking is rooted in the concept that the nation is the operative unit of economic analysis. The origins of this idea are deeply embedded in the historical struggle for ascendancy between city-states and nations as well as in the promise of Keynesian economics that the capitalist demon of the business cycle, recurrent swings of prosperity and wrenching depressions, can be controlled through nationally administered macroeconomic policy.

Historical Perspective: The Rise and Demise of the City-State

In the historical struggle for supremacy, nation-states—the centers of power—gained ...

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