Is globalisation undermining the policy autonomy of developing countries? Are democratic deficits being created when the demands of internationally organised neo-liberal elites conflict with popular preferences and concerns? What are the implications of this for the poor? A paper by the Institute of Development Studies reviews the debates on the impact of globalisation on the role of the state in development. Arguing that globalisation has to be understood historically and as a political process, it warns against simplistic assumptions about northern ‘winners’ and southern ‘losers’. Options may be constrained, and there may be more policy choices for some governments than for others, but states are likely to retain some autonomy and capacity to determine the organisation of national economies.