Traditional approaches: liberal, mercantilist, marxist.
• Three analytical and moral starting point
o Liberal: (neo liberal) economic order as result of market operation
• Intituionalists: apply rational choice to explain economic cooperation
• Constructivists: how do actors construct preferences?
o Highlight identities, beliefs, traditions and values
• Neo gramscians: actors define/pursure interests within a structure of ideas.
Culture and knowledge shaped by hegemonic powers
• Institutions created after depression and second ww
• Cold war postponed operation of these institutions --> US managed european
reconstruction and dollar based international monetary system
• Bretton woods: managed exchange rates and capital flows until 1971 (US would
no longer convert dollar to gold)
• The role of the IMF collapsed when the bretton woods system broke down in
• Industrialized countries float exchange rate, engage in trade protectionism
• Developing countries push for new economic order (NIEO)( no success except
for OPEC when it raised oil prices.
• Debt crisis: new IMF role (overlap with world bank)
• New world trade organization ( GATT/WTO)
IFI: international financial institutions
International monetary fund: IMF
World bank : WB
Replacing the general agreeement on tariffs and trade ( GATT)
• Institutions created after depression and second world war
• International organization that oversees the global financial system by following
the economic policies of its 185 member nations
• Particularly focuses on exchange rates, facilitating development, reducing
poverty, and global cooperation
• Also offers financia