POL208Y1 Lecture Notes - Lecture 15: John Maynard Keynes, Dani Rodrik, Impossible Trinity
Document Summary
Winners and losers: domestically: stolper/samuelson, internationally: terms of trade. History: 19th century: the industrial revolution; the repeal of the corn laws; a dramatic growth in international trade. Power distribution matters: hegemony free trade, without hegemon a stable system of free trade is very unlikely, structural variable (power) economic/political outcomes, realist/neo-realist because it looks at the distribution of power. A hegemon enjoys a comparative advantage would benefit from free trade. Hegemony suggests stability and security: beneficial for trade. A hegemon would set trade rules that benefit its interests: can create an environment that benefits free trade for its own interest, it is in the interest of the hegemon to adopt free trade. A hegemon could use its power to force other countries to open up to free trade. A hegemon solves the prisoner"s dilemma: fear the danger of exploitation, external country which can punish those that defect and more incentives to those that cooperate hegemon.
