Many who believe that ethnic identity is "constructed" by large historical forces and reinforced by specific ethnic entrepreneurs have suggested that under globalization, the concept of ethnic identity is eroding and that ethnonationalist states are unraveling. Globalization, they argue, is dampening ethnic identity and weakening ethnic nationalism. This is because the global spread of market imperatives, the growing universal importance of science and technology, and the global diffusion of information and ideas demand less identification with a specific ethnic group and less attachment to homeland. As globalization intensifies, constructivists argue, the process of separating ethnic identity groups by rigid borders--so painfully achieved in the twentieth century-- is coming to an end. Market imperatives demand a common language, produce common behaviors, and create cosmopolitan identities. The requirements of science, technology, and information create a demand for universal standards and language, which in turn requires the removal of obstacles to free communication across borders. Progress in science and technology demands objectivity, impartiality, rationality, and open communication. These forces eat away at national differences. Societies have become more knowledgeable of one another as international travel has become faster, easier, and cheaper. Different ethnic groups have come to appreciate one another as people, music, art, food, and film flow across weakened national borders. As goods, ideas, technology, culture, and information seep through national borders and a single market rationality entrenches itself throughout ethnic nationalist homelands, cultures are converging, and local ethnic identities are weakening.
Primordialists often make two counterarguments. First, some suggest that globalization will have little impact on ethnonationalist identity because, with the global reach of the multinational corporation, jobs can be brought to the workers instead of the workers to the jobs. And with the rise of information technology and instant communication, people in far flung nations can be part of technical, medical, legal, and other professional teams without leaving their homelands.
Second, primordialists argue that the process of globalization can actually enhance the power of ethnic identity and exacerbate conditions that cause conflict among ethnonationalist states. With its speed and ease of communication, globalization has decreased the world’s size. In a small world, interdependence means constant contact; the closer the contact, the more visible the differences; close contact gives groups more to fight about, and thus--the argument runs-- intense interdependence may actually stimulate belligerence. For the primordialist, contact breeds contempt. They point out, for example, that the integration of constituent republics of the former Soviet Union and Yugoslavia, including their mixed populations and economic interdependence, did not prevent the disintegration of these two countries into separate ethnic homelands. Many suggest that the industrialized West is not immune to these same primordial forces: Immigration has ignited conflict throughout Europe as it has turned homogeneous nations into heterogeneous societies with vast differences in appearance, wealth, values, and cultural practices. Native populations have often turned against these immigrants: hate crimes against foreigners have multiplied in recent years, and European governments have taken increasing measures to plug leaks in porous borders. In a world still dominated by ethnonationalist states, but marked by growing immigration, native populations and their governments assert their ethnic identity as they seek or try to keep states "of their own" for themselves.
Within this context, both primordialists and those constructivist observers who focus on "ethnic entrepreneurs" also argue that, like any powerful movement for change, globalization encounters resistance. Integration in the global economy—even if the result is net aggregate growth—creates economic winners and losers, both in the domestic and international economies. Global economic forces can cause distinct cultural groups in multi-ethnic societies to suffer disproportionate economic hardships and gains and can cause some ethnonationalist states to prosper while others suffer. If economic hardship falls disproportionately on distinct cultural groups, economic grievances can be transformed into a resource for political mobilization. Groups with grievances are ripe for recruitment efforts by ethnic entrepreneurs. Joerg Haider, for example, the former leader of Austria's extreme right wing party, was a popular ethnic entrepreneur, gaining particular support among Austria's unemployed native citizens as jobs disappeared with Austria's integration into the European and international economies. His electoral campaign speeches portrayed immigrants as being responsible for both unemployment and increased public expenditure, as well as posing a threat to the preservation of Austrian ‘identity.' Primordialists and constructivists alike suggest that, although the forces of globalization may have created a cosmopolitan identity—particularly among elites—they have failed to erase and even deepened ethnic divides.