ABSTRACT
Today’s world is highly integrated. International trade (despite the problems caused by the world-wide economic crisis that began in 2008) is at record levels. International capital flows are intense and contribute to global imbalances, on the one hand, as well as to a better allocation of capital, on the other. This world-wide interaction is economically and politically welcome, because it potentially increases welfare and reduces global violence. However, this potential is not everywhere fully used. Instead of contributing to welfare and peace, contemporary globalisation is also increasingly volatile, transferring shocks and, therefore, is perceived as a threat. To materialise its full welfare and peace effects, globalisation needs to be mastered through international agreements and organisations.
