This article presents a critical review of the substantial and growing literature in British politics on globalization. It is concerned with three central issues: the extent to which the British state and economy can indeed be said to be exposed, and increasingly exposed, to the (competitive and other) pressures associated with globalization — i.e. the extent of the globalization of the British economy since the 1960s; the extent to which the reform trajectory of the British state and economy since the 1980s provides a model of the adaptation of an advanced liberal democratic welfare state to the competitive pressures of an ever more integrated global economy; and the extent to which that reform trajectory rests on a particular understanding of globalization and the nature of the British state and economy's exposure to globalization. British growth is not the product of competitiveness but has been achieved largely despite a lack of competitiveness.
While the British economy was indeed more internationalized than those in other European states, the emphasis some scholars have placed on the Conservative governments' active encouragement of that openness has risked missing some important political nuances from the 1980s and the first half of the 1990s. New Labour assumed power without having to confront an immediate economic crisis. Its economic success was premised on acceptance of the constraints of an open international economy. The political success of New Labour in economic policy is elaborated here. The New Labour government escaped any consequences for sterling of the burgeoning current account deficit for reasons that would seem to have more to do with the dollar's weakness than any permanent indifference of investors in the present international economy to current account weakness. While relative economic decline appared to be over, significant features of the exceptionalism that was frequently held responsible for it remained.