Whither interdependence?

The definition and direction of interdependence remain unclear. As a corrective, interdependence can be defined as the direct and positive linkage of the interests of states where a change in the position of one state affects the position of others and in the same direction. Interdependence, then, is measured both by the flow of goods between states—horizontal interdependence, and the equalization of factor prices among states-vertical interdependence. Horizontal and vertical interdependence measured across six industrialized states from 1890–1975 reveal some important changes in the interdependence among these states. Fairly significant before World War I, interdependence declined markedly in the interwar period. Following World War II, interdependence seemed to increase once again, but since 1958 the measures appear much more mixed. The data seem to support a detachment of individual national policies from the general trend toward interdependence. This detachment may alter the trend, reducing the positive and direct relationship among industrial economies.