While transnational illicit flows of people, goods and technology are not a new phenomenon, it has been widely recognized that the volume of these flows has increased dramatically in the globalizing era that has followed the end of the Cold War. This increase has largely been a result of the technical innovations associated with globalization, combined with the popularization of "free trade" ideals. Simply put, the sheer volume of international trade has meant that even states of the developed world increasingly cannot control their borders. What effect has this increase in illicit flows had on states and their power in the international system? Though illicit flows are still an emerging area of study, some themes have already begun to take shape in the proposed answers to this question.
The dominant perspective, as espoused by law enforcement authorities, most policymakers and many academics, is that illicit flows empower nonstate actors at the expense of states. According to this view, illicit flows erode state legitimacy and security. For one, the territorial nature of state power is inherently challenged by unauthorized disregard of state borders. Meanwhile, illicit flows and the private organizations that feed on them often threaten state security, both physically as well as financially. Nonstate actors -- such as transnational criminal organizations (TCOs), terrorist networks and insurgent groups -- often profit from the illicit movement of people and goods and can use these profits to finance challenges to the alleged state monopoly on violence. By facilitating such efforts, as well as by allowing nonstate actors to provide other traditional state services, illicit flows further detract from the legitimacy of states -- with states of the developing world particularly vulnerable to their effects.
While likely valid for a number of states, this long-dominant perspective is not fully supported by the experiences of all states. As a number of scholars have argued, power as experienced by states of the developing world often differs from that in the developed world. As such, the effects of an increase in boundary-defying illicit flows, even a massive one, may be uneven. Some states may, in fact, find some substantial economic and even security benefits to be gained from the presence of or access to illicit flows. The vastly different impact that illicit flows have had on the neighboring states of Afghanistan and Pakistan helps to demonstrate their varied effects on state power. Afghanistan exemplifies the dominant arguments about illicit flows, whereas Pakistan serves as an important illustration of how a state, even a weak one, may derive significant benefit from such flows.