| Summary: | Part of a special section on technology and international policy in the information age. The new “electronic” forms of money created by the application of information technologies (IT) to the financial sector present important challenges to state power and control. These challenges have led some analysts to propose that the IT revolution is generating a profound transformation in the nature of the world order. Some see a dramatic relocation of power and authority taking place in global politics, involving the decline of the sovereign state. However, there are several ways that states can respond, and have already responded, to these challenges. Indeed, if states adapt effectively to the new technological world, IT might even improve their power. In light of such a possibility, the impact of the IT revolution on sovereign states' ability to control global financial flows and the implications of the new forms of stored value devices for states' control of not only financial movements but domestic monetary policy are discussed.
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