2 SOCIAL SCIENTIST from greater integration into the world system. This is seen to occur largely because of three factors. First, evidence that the revolution in technology and communications and changes in policy regimes in the direction of greater liberalization has unleashed a wave of industrial relocation which makes corporations seek out the best sites worldwide to locate increasingly segmented production proceses with the aim of catering to markets worldwide. Second, the wave of liberalization that this opportunity lets loose is expected to not only ensure industrial proliferation and growth, but also unleash a range of 'efficiency' benefits in both the agricultural and industrial sectors, which when automatically reinvested in pre-Keynesian fashion, accelerates the growth process. Third, any short term worsening of the balance of payments because of opening up of Third World markets is expected to be financed by flows of portfolio capital, the enhanced flow of which to the developing countries is seen as making the current account deficit less of problem than it was in a world of more insular nations. The articles in this issue of Social Scientist address these arguments based on analyses made from an international, regional and national perspective. Prabhat Patnaik's contention is that the age of global finance, 'far from eclipsing the age of imperialism, in fact strengthens it greatly'. To start with, the restriction on the manoeuverability of the State in even the developed industrial nations, placed by fluid financial capital, is hardly even in its incidence. Since the dollar is still as good as gold, the United States is able to easily finance its fiscal deficits, and is therefore definitely better off than the others from the point of view of the ability to stimulate economic activity through State intervention. And to the extent the US can and chooses to serve as the locomotive of global capitalism, the level of international economic activity is not determined purely by market forces. Any such rise in economic activity has as its counterpart a rise in the profit-margins earned by the manufacturing sector in the developed countries, influenced by higher financial sector returns and a shift in the terms of trade against primary commodities. Further, in periods of recession in the developed countries the thrust into export markets in the developing countries, supported by the flow of global finance to pay for developing country imports leads to a deindustrialization of the latter. That is, the globalization of finance has very differential effects on different segments of global economy, resulting in a reproduction of international inequality. If at all growth has to occur in the developing world, it would be in those countries which deny freedom to financial interests as was initially true in East and Southeast Asia. In fact, many would argue that it is precisely the weakening of controls over the operation of global finance that explains the problems being faced by some of these countries, like Thailand, today. The reasons for the success of the East Asian countries and the special problems faced by some of them in recent times are analysed in other articles included in this issue. The central theme which runs through all of them is the crucial role of the State in explaining the East and Southeast Asian success