How do nation states relate to each other in terms of power? How do they relate to private parties in terms of power? Nation states are often thought of as sovereign to tax. In a legal sense that may be true. However, to be legally sovereign is not the same thing as being able to effectively exercise sovereignty. The mobility of capital and businesses, or at least the perception of their mobility, is increasingly pressuring sovereignty to tax. To shed light on the economic constrains on nation states and the beliefs about such constrains, this article introduces the concept of economic-ideological forces and contends that sovereignty should be understood in a way that encompasses these forces. Otherwise, it does not provide an adequate account of power and thus becomes a tool for maintaining established power relations.
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