Lecture at: 01/15/2014
C LASS N OTES FOR : P OLI S CI 2J03
McMaster University, Fall 2013
W EDNESDAY , ANUARY 15, Y
- Picture of settler and aboriginal exchanging furs for other (trade)
Origins 1800s (19 century) - England. Picture of Adam Smith, published the Wealth of
-Direct response to economic nationalism, since it was the dominant way of thinking
about the world and the way it worked
-Put together a liberal critique, that was launched at economic nationalism
-1800s (England is going through the Industrial revolution these political principles
gained strength and traction, begins a process of spreading these principles throughout
Dynamics -Positive view of markets
-Whereas the economic nationalist was stressing a world of conflict, the liberals are
more likely to focus on cooperation
-Whereas economic nationalists are concerned about the way in which the market
operates, the liberal approach sees a great deal of benefit in the functioning of markets
-The view of markets is that they can be the most efficient allocator of resources
-The market in the process of supply and demand will make better choices than the
-Individuals pursuing their own interests and making their own choices will come out
with better outcomes than the state
-Need to let individuals choose what kind of ‘entertainment’they want to watch, as
opposed to someone in the government choosing what they should watch
-Expansion of MARKETS, to liberalize markets.
Actors -Where as the economic nationalist see the main actor as being the “state”
-Liberal see a more diverse set of actors as being important
-Individual welfare, TNCs, States
-The goal might not be the welfare of the state, but what’s in the best interest of
individuals andALL of the individuals
-Most recent times would pay attention to the significance of Transnational or
-The state is not always right and not always the state interest, we need to look at the
interest of other actors
Conflict and -Absolute gains
cooperation -Liberal view of conflict is different from economic nationalist view (that conflict is
inevitable it’s a 0 sum game, etc.) the liberal view turns it on it’s head because it’s
almost the opposite. It’s a + sum game.
-Whereas the economic nationalist sees the world as a PIE; the liberal see a different
kind of world (let’s figure out some way that in our interactions with each other, we can
grow the pie larger, so we do not have to fight over the pieces of the pie).
-What is most important is that they increase the wealth of the U.S (ifAmerican); more
than we are interested in whether someone is doing better than us. Focusing on
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Fall 2013 Lecture at: 01/15/2014
-We are interested in how people are increasing their wealth
-Better opportunity for cooperation, to work together to further the common interest.
-See the world as everyone’s fate as being linked together
-Opens up the possibility of cooperation and creating outcomes that are mutually
-If you have extensive economic relations with other countries, less likely to go to war
with them. More beneficial to engage in trade, than to engage in warfare.
--- Relationship between free trade and peace!
-COOPERATION with IOS
---Large significance of IOS
---Economic nationalists are more doubtful about the usefulness of IOs, where as the
Liberals see IOs as crucial in facilitating cooperation.
-Liberals more enthusiastic about the WTO, World Bank, ETC.
-Economic nationalists will see these institutions as reflecting the interests of the
dominant powers (to serve the United States, European Union, etc.)
Variations -Embedded Liberalism
---Refers to the economic system that was dominant in the Western world between
1940s and 1970s
---Refers to liberal principles being embedded or rooted or restricted, tempered, etc. in
broader social purposes or in national states.
---Commitment to liberalism, free trade and liberal economic relations, but it was a
restricted commitment, restricted by states desires to pursue other goals such as
employment or increasing equality within states.
---Limited liberal system?
---Trading arrangement where states agreed to reduce barriers in the trade of
---Challenges embedded liberalism
---Amore “pure” form of liberalism, where some of the restrictions from embedded
liberalism are removed.
---Larger focus on the role of the market in allocating resources!
---Larger commitment to freer trade, capital mobility
---Expand the coverage of free trade, far beyond manufactured goods! Services,
entertainment, health care, education, IPRs, etc. Opening up the realm of the market
and economic competition to more areas.
---Degrees of liberalism!
---Bed rock of liberal thought
---Notion and idea that everyone stands to benefit from a free and open trading system!
Liberal view of the world is more associated with a COBWEB! Everything is interconnected. All actors
are tied together, and what happens to one part will affect the other parts.
ð Critical Theory
- Picture of a plantation, some force being applied to get people to do particular kinds of work
Origins -Lots of variants of Critical Thought