ABSTRACT
This chapter outlines the debate on the linkage between world economic integration and political conflict. It utilizes some measures of world economic integration: penetration by transnational corporations, debt service, direct foreign investment and the export ratios. The chapter investigates whether the effects of economic openness are transmitted by the regime type and economic growth. It discusses that the effect of the regime type may also be mediated by inequality. The chapter explores that authoritarian incorporation of interest groups into the process of policy formation and implementation is more important in explaining below-average political unrest in Latin America than the presence or absence of democratic rights. It concludes that regimes which peacefully accommodate business and labor interests should incite less social unrest than authoritarian regimes which oppress trade unions, or democratic regimes in which policy formation is dominated by multi-party politics.
