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Two of the fundamental political and economic phenomena of the last century has been the break up of nations into smaller states and the increased economic integration of international markets. This book reviews the theoretical literature on these topics. The purpose of this book is to study the relationship between size, government consumption and trade openness. The empirical results here show that, country size is negatively related to the trade openness and most of the government spending items. The results are robust to different time periods, country samples, different econometric techniques and to several sets of control variables. This book strives to prove that large countries are better off in an open economy and small countries are better off in a closed economy.