Globalization increases the potential mobility of financial capital, real investments, goods and services, and to a more limited extent, highly skilled labor. As a consequence, mobile economic actors are better able to avoid undesirable state regulations, or to profit from more advantageous ones. To the extent that countries depend on these actors, or on the resources they control, they are forced into a competition for locational advantage that has all the characteristics of a Prisoner's Dilemma game, and that reduces the capacity of the territorial state to shape the conditions under which capitalist economies must operate.