Globalization and state size in East Asia: How do international NGOs cushion the effect of trade?

Abstract

How does globalization influence the size of the state? Many studies examine the effect of economic globalization or the impact of International NGOs (INGOs, hereafter) on state size but fail to acknowledge the interdependent and antagonistic associations between them. This paper addresses this gap by examining the interaction of trade and INGOs and identify how this interaction differs in democratic and nondemocratic countries. In drawing on panel data from 6 East Asian countries in the period 1971-2009, this paper finds that the negative impact of trade on state size can be alleviated by the engagement of INGOs, and INGOs’ effect is much stronger in democratic countries. In addition, health INGOs have a similar pro-state effect which is also stronger in democracies. This suggests that INGOs help cushion the negative consequences of trade by collaborating with domestic actors, which is more likely to occur in democratic settings.