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PSCI 2602 (21)
Lecture

PSCI 2602 Lecture.docx

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Department
Political Science
Course
PSCI 2602
Professor
Supanai Sookmark
Semester
Winter

Description
PSCI 2602 DOHA US Federal Reserve System What is IPE? Some shared assumptions among students of IPE: A connection between the political and economic domains. A connection between the state and the market (and social forces, such as: Farmers). A linkage between domestic and international spheres. Multidisciplinary field of study. Key Issues: International trade International finance Transnational corporations Development Gender Environmental sustainability Effects of globalization Its all about the Benjamins! IPE Subject Matter: Hegemonic Stability: End of American hegemony? End of the bread and wood system? Collapse of the fixed exchange system. Concerns of the power of the United States in the late 1970s. Transformation of global political economy: Globalization? (Are we experiencing an even amount of globalization? What about the millions and millions of people in rural areas of underdeveloped countries, do they experience globalization in the same way?) Global Governance. Evolution of capitalism: Projection of Capitalism. Contending models of capitalism. Effects of Capitalism Transnational corporations Should we trade based on a moral framework or compass? BIG Questions: Hegemonic stability = end of American hegemony Transformation of global political economy = globalization, global governance Evolution of capitalism = projection of capitalism, contending models History of the Field Roots in classical political economy Mercantilist thinking (17 and 18 century) th Liberal challenge in the late 18 century (Smith) Marx and his critique Decline due to academic specifications Not Homogenious: Contending theories/approaches. American school vs. British schools Internal competition and diversity: Mainstream vs. Critical IPE. Imbalanced interest/emphases Continental traits of classical IPE In economics: works that incorporate historical, political, or social dimension (Keynes) Outside economics: radical political/social theories Other kind of division American school: Shared theoretical foundation in rationalism, utilitarianism as neoclassical economics. Inclined toward scientific method. Policy-oriented studies, practical solutions. British school: Normative, interpretive method. Interested in effects of social structures, ideas on interactions between actors. Gives importance to history. Our IPE 3 connections: Politics and economics. State and market. Domestic and international Take note of the different views/approaches and their biases Whats missing? Whats being undermined? Try to take into consideration views of the less powerful and marginalized Understanding IPE theories Not mutually exclusive Variations within each school of thought Theories evolve over time Characteristics of Economic Nationalism Major actors and emphases: States as dominant actors (realist IR). National economies. Goal of states pursue national interests (how national interests are formed). States are rational actors seeking to maximize interests (neoclassical influence) and power. Nature of international economic relations (realist IR influence): Conflictual, competitive, a struggle for power and wealth. Relative gains, zero-sum. Most powerful states shape rules governing global political economy. Relationship between politics and economics: o Closely intertwined. o Concerns for national interests (such as national competitiveness) drives economic policies. o The state has a role to protect and promote national economy, which can take many forms (ie: regulating private industries (List), protectionist policies, or liberalize the economy). Characteristics of Liberalism Major actors: Multiple actors both state and non-state. International level MNCs, international organizations. Domestic level consumers, enterprises, economic sectors or industries. Actors are rational and in pursuit of their interests (neoclassical economics influence). Nature of international economic relations: Mutually beneficial or positive-sum (in his critique, List referred to the prosperity of all human beings). Interdependence and cooperation among states for mutual gains. Relationship between politics and economics: Should separate between the two. Markets will function efficiently when free from political intervention [Smith saw negative effects of conflict of interest of state intervention (use of state power for private gains)] (Neoliberalism state intervention distorts market efficiency). Domestic role of state provide market-friendly environment. International role establish rules and regulations. Evolution of economic nationalism and liberalism: Liberalism: Classical liberal IPE led by Smith and Ricardo challenged mercantilist dominance. Questions role of politics and state intervention (Smith conflict of interest, use of power for private gains). Argued for free trade and free market (But with some reservation). Dominated the field late 19 century. Context of industrial revolution and rise of Britain. th Mercantilism: Challenged by liberalism in 19 century. Seen in economic policies of new comers, eg: U.S and Germany. 19 century key writers: Alexander Hamilton and Fredrick List. Liberalism Post WW2: Keynes a revision of classical liberal IPE. Calls for government intervention to prevent economic downturn and unemployment. Promotes international economic cooperation Bretton Woods institutions. Context of the great depression and protectionism. Liberalism After 1970s: Concept of interdependence. Interconnectedness of international economies reshapes politics. Complex interdependence (Keohane and Nye 1977). Concept of interdependence: Multiple channels. Multiple issues absence of hierarchy. Military force cannot be used in every situation. Decline of Keynesianism and rise of Neo-Liberalism (since 1980s): free market system, trade and financial liberalization, minimal government intervention. Hegemonic Stability Theory Hegemonic stability theory: offered by three major schools of IPE. Shared perception: an open international economy with a concentration of political and economic power in a single state. Hegemonic stability theory Liberal version: Kindleberger hegemonic power as provider of international public good. Keohane international institutions can help play this role in an absence of hegemon. Hegemonic stability theory Neo Mercantilist IPE version: Rise of a hegemon is a result of a change in a distribution of power. International economic order serves the interest of the most powerful states. When a hegemon in decline, self-interested behaviour resumes. Cross fertilization: Shared assumptions (an open world economy needs a hegemonic, superpower, to help maintain stability). Lists infant industry protection argument: The state is not merely justified in imposing, but bound to impose, certain regulations and restriction on commerce for the best interests of the nation... ... we have imposed restrictions on the competition (with foreign countries)... to give those among us who invest their capital in these new branches of industry... the requisite guarantees that they shall not lose their capital and shall not miss their vocation in life... The critical perspective: Marxism/Structuralism, Critical/Radical theories, Historical Structuralism. Marxism, Dependency theory, World-Systems theory, Gramscian analysis, Constructivism, Feminism, and Environmentalism. Nature of International Economic Relations: Conflictual, hierarchical Conflicts stem from exploitation and competition Economics dominates politics: political system helps facilitate economic structure. Governments are subservient to capitalism. Critical theories seek to challenge and change it. Theory is for someone and some purpose (Robert Cox, 1995) Karl Marx: Focused on domestic capitalist society Capitalism breeds class struggles (capitalists vs. Workers). The need to find more markets led to capitalist expansion abroad (colonialism).
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