(329596441) Global Politic Economy O'Brien

Rational choice 28Institutionalism 29Constructivism 31

Trends in Contemporary GPE Theory 33Consolidation 33Integration 34

Copyrighted material –


Contents

List of Boxes, Tables, Figures and Maps x Expansion 35Preface to the Fourth Edition xiii Approach of the Book 37List of Abbreviations

Introduction

xiv

1

Further Reading 39

Part 1 Theoretical Perspectives 5

1 theories of Global political economy 7

Understanding the Global Political Economy 7The Economic Nationalist Perspective 9

Key actors 9Key dynamics 10Conflict and cooperation 11Economic nationalism today 11

The Liberal Perspective 13Key actors 14Key dynamics 14Conflict and cooperation 15Liberalism today 15

The Critical Perspective 17Key actors 18Key dynamics 18Conflict and cooperation 19Critical theory today 19

Contending Perspectives: A Summary 21Further Reading 22

2 international political economy and itsMethods 23Locating the Field 23

Economics 24Political science 25Political economy 25International relations 26

Methodological Issues 27Case studies and large n studies 27

Part 2 Evolution 41

3 Forging a World economy: 1400–1800 43Regions of the World Economy 44

The Middle East 45China 46India 47Africa 48The Americas 48Europe 49

European Expansion 54Into the Americas 54Along Africa: the triangular trade 57On the peripheries of Asia 59

Conclusion 62Further Reading 66

4 industry, empire and War: 1800–1945 67The Industrial Revolution 68

What was the Industrial Revolution? 68Why Britain? Why then? 70What did the others do? 72

Pax Britannica 72The gold standard and capital flows 72Free trade 75Balance of power 75

Renewed Imperialism 79War and Economic Disorder 82

The world wars 82Interwar economic failure 84


5 Growing a Global economy: 1945–2010 91The Cold War Era: 1945–89 91

The US-led Western political economy 91The communist political economy 94The southern political economy 94

vii

Development and national capitalism,1947–81 229Development, neoliberalism and beyond,1982–2009 231

Key Issues 234

Critics of free trade 113

Growth and protectionism 115Changing institutional arrangements 119

Key Issues 122

IMS: from fixed to floating and regionalcurrencies 159Credit: financial innovation and repeatedcrises 163



viii | Contents

The Post-Cold War Era: 1990–2010 96 Key Issues 172Competing capitalisms and state Global credit crisis 172transformation 96 Future of the US dollar 174The information revolution 99 The European sovereign debt and euro crisis 177International organizations and governance 101 Conclusion 179

Conclusion 102 Further Reading 181Further Reading 105

9 Global division of labour 182

Part 3 Dynamics 107

6 international trade 109Definitions 109Theoretical Perspectives: Free Trade andProtectionism 111

Proponents of free trade 111

Developing country interests 123Regional trade agreements 127Legitimacy 129


7 transnational production 132

Definitions 134Theoretical Perspectives: Explaining theGrowth of TNCs 135Major Developments 138

The globalization of production 138Changing organizational principles 142

Key Issues 145Re-evaluating the benefits of FDI 145State–firm interactions 148Regulating capital 152


8 the Global Financial system 154Definitions and Background 154Theoretical Perspectives: The Mundell-Fleming Model 157Major Developments 159

Definitions 182Theoretical Perspectives: Adam Smith andhis Critics 185Major Developments 187

From the new international to the global division of labour 188

Key Issues 190Global restructuring: the rise of China

The struggle for workers’ rights in aglobal economy 194The division of labour and global stability 196


10 Gender 200Definitions and Background 200Theoretical Perspectives: GPE as if GenderMattered 202Major Developments 205

Women in the world economy:employment trends and prospects 205Gender and global public policy 207

Key Issues 212The feminization of poverty 212Globalization of reproductive work 213Gender and global restructuring 216


11 economic development 219Definitions 221Theoretical Perspectives on Growth andDevelopment 224Major Developments 229

The organization of development 234



Contents | ix

Debt and debt relief 237North–South conflict 239


12 Global environmental change 242

Definitions and Background 243Theoretical Perspectives: IPE andEnvironmental Studies 244

IPE debates 245Environmental studies’ debates 247

Major Developments 249Bringing the environment in 250Mainstreaming environmentalism 252

Key Issues 253

14 security 277Definitions: Three Views of Security 277

The traditional state-centric approach 277New security studies 278Human security 279

Theoretical Perspectives: IntegratingSecurity and Political Economy 280Major Developments 283

The Cold War security structure 283The post-Cold War security structure 284

Key Issues 288Economic statecraft and security 288Transnational crime 291Disease, pandemics and security 292

Conclusion 294

Sustainable developmentTrade and environmental degradation

253256

Further Reading 294

Climate change negotiations 257 15 Governing the Global political economy 295Conclusion 259 Definitions 295Further Reading 260 Theoretical Perspectives: Whither the State? 295

Major Developments 29713 ideas 261 Proliferation of governance levels 298

Definitions 261 Proliferation of actors 301Theoretical Perspectives: Ideas about Ideas 262 The Global Compact 304Major Developments 265 Twenty-first-century Challenges 305

The information revolution and the Development and growth 305information society 265 Equality and justice 306The rise and stall of the Washington Democracy and regulation 309Consensus 267 Conclusion 311

Key Issues 270 Further Reading 311Technological diffusion 270Property rights and life (HIV/AIDS) 271 References 312Ideas, interests and the global financial Index 332crisis 273


Understanding the GlobalPolitical Economy 7The Economic NationalistPerspective 9The Liberal Perspective 13The Critical Perspective 17Contending Perspectives:A Summary 21Further Reading

I



Chapter 1

Theories of Global Political Economy

n its present form, the field of international political economy (IPE) or global political economy (GPE) is a relatively new undertaking at universities. This chapter introduces readers to three of its main theories. Chapter 2

gives readers an overview of the relationship of IPE to other fields, considers some of the methods used to study IPE, and examines the future directions of GPE theory.

Understanding the Global Political EconomyDuring 1996 and into 1997, a small number of investors and currency traders began to have doubts about whether Thailand’s economy would be able to continue its record of remarkable growth. Fearing a reduction in economic prosperity and profit, some of these investors began to withdraw their money and investments. The outflow of money forced the Thai central bank to devalue its currency, the baht. This began a process which was later called the1997 ‘Asian financial crisis’. By the time the crisis had run its course, several Asian countries experienced economic depression, the government of Indo- nesia was overthrown, countries previously labelled economic miracles, for example South Korea, were forced to seek loans from the International Mone- tary Fund (IMF) and the viability of the international financial system was called into question.

Although the 1997 Asian financial crisis was clearly a significant development in the global political economy, it was not immediately apparent what caused the events, what were its most significant aspects or what lessons might be drawn from the crisis to prevent a similar event from occurring. Indeed, a number of different stories are told about the crisis (see Table 1.1). One story, the liberal story, locates the causes of the crisis primarily in the financial policies followed by Asian states (McLeod and Garnaut, 1998). This view suggests that

Table 1.1 Interpretations of the Asian financial crisis

Liberal State power Critical

Causes Crony capitalism, lack of transparency

Overrapid liberalization, reduced state capacity to regulate

Predatory liberalism, power of financial interests, systemic flaws

Key issue(s) Corruption, lack of liberal economic practices

Clash of Anglo-American versusAsian models

Human suffering caused by financial collapse



Lessons Increase transparency and good practice in developing countries

Limit financial speculation through state policies

Reform international financial system, defend national system

7



8 | Theoretical Perspectives

resources were directed to inefficient uses because of corrupt business practices and political influence over financial institutions. The term ‘crony capitalism’ was developed to capture this inappropriate model of political economy. The lesson to be drawn from the crisis is that financial markets will eventually punish economic activity which violates or ignores liberal economic principles. The solution is for developing countries to have more transparent financial practices and follow a more liberal economic model.

A second story stresses the significance of state power in creating and exploiting the crisis (Weiss,1999). In this view, the problem arose because developing countries liberalized their economies prema- turely and allowed large amounts of money to flow into and out of their countries too quickly. This undermined the East Asian model of political economy and caused a crisis. This approach would stress how the US used the Asian crisis as an opportunity to force some states to restructure along lines that benefited Amer- ican business. During the crisis, Asian states attempted to counter American initiatives at the IMF and to continue to resist the undermining of their particular form of capitalism (Higgott, 1998). The lessons from the crisis are that states need to be careful about liberalizing their economic activity and must pay attention to guarding their national interest.

A third story (critical) focuses on the role of US private business interests and the US government in creating the conditions for a financial collapse. It suggests that the US government pressured developing states into liberalizing their economies because this suited the interests of the US Treasury and leading financial firms on Wall Street (Wade and Veneroso,1998). Once the crisis took place, the same interests pressed the IMF to demand that Asian economies restructure in a way that would open markets for US firms. This story also stresses the high degree of suffering caused by the financial collapse and the fact that its costs were unevenly distributed. For example, the collapse of the Indonesian economy pushed millions further into poverty, but left wealthy financial interests in developed countries relatively untouched. In this view, the international financial system facili- tates the rapid movement of money between countries and contributes to the reoccurrence of financial crisis in many parts of the world (Walton, 2002). Action needs to be taken to

curb financial speculation, such as a tax on large short-term foreign exchange transac-



tions. States should also consider restricting the ability of investors to move their funds abroad rapidly.

This brief example of the Asian financial crisis demonstrates that the same event can be analysed in several different ways. Indeed, most major developments are interpreted through competing explanations. Facts do not exist independently of explanatory frameworks. Facts are pieces of information that are thought to correspond to reality and be true, but the way in which they are perceived and judged is influenced by theory. In order to make sense of the world and to enable us to take constructive action, humans develop theories to help determine which facts are most important and what significant relationships there are between different events. Theories are used for a variety of purposes:

• they can prioritize information and allow individuals to turn their attention to the most important issues

• they can be used to make predictions about thefuture so that action can be taken to prepare forupcoming events

• they can be used to plan action or mobilize supportfor particular action.

Every person utilizes theory to run their life even if they do not engage in explicit theorizing.

Actors in the global political economy and those studying it use a variety of theories for a variety of purposes. Some people are interested in prediction. For example, they would like to be able to predict what type of monetary system would lead to stable economic growth, or to predict the likelihood of war between democratic states. Others believe that prediction is nearly impossible because so many factors come together to influence events. These people are more likely to use theory in an attempt to understand the world rather than to predict what will happen next.

In this book, we use and describe a number of theories to guide us in understanding the world. The development of IPE is often presented as a debate between three contending schools of thought, paradigms or approaches. Some commentators refer to contending paradigms, others to different schools of thought and yet others to competing approaches. It does not really matter for our purposes whether they are seen as theories, paradigms, schools of thought or approaches. The central point is that three main contending perspectives have been used to explain



Theories of Global Political Economy | 9

developments in the global political economy. Although analysts distinguish between these three approaches, there is a wide variety of thought within each approach and much work in IPE draws on more than one of them. In addition, there are a number of other approaches, such as environmentalism, feminism and poststructuralism, which contribute to the study of IPE. These will be introduced later in the text. Let us look begin by looking at the oldest approach – economic nationalism.

The Economic NationalistPerspective

One school of thought brings together analysts who focus on the role of the state and the importance of power in shaping outcomes in the international political economy. These theories stress the importance of the interest of the nation or the state in understanding activity in international relations (IR). This grouping is variously termed ‘mercantilist’, ‘neomercantilist’,‘statist’, ‘state-based theory’, ‘power politics’ or‘economic nationalist’. The equivalent in IR theory is realism. We use the term ‘economic nationalism’ to refer to this perspective because at the centre of such analyses is the protection of the national unit. The underlying economic argumentation may alter, for example, but the objective of economic intercourse remains the same.

The origin of this school of thought can be traced back to the emergence and expansion of the nation- state in Europe in the 15th century. Mercantilism was a doctrine of political economy that governed the actions of many states until the liberal revolution in Britain in the mid-19th century. Mercantilists believed that there was only a limited amount of wealth in the world and that each state must secure its interests by blocking the economic interests of other states. This is known as a‘zero-sum game’. One state’s gain is another state’s loss. From the 15th until the 19th centuries, European states strove to establish overseas empires that would be as self-sufficient as possible. Trade between neighbouring colonies of rival empires was discouraged.

Two famous advocates of mercantilist theory were Alexander Hamilton ([1791]1991) and Fredrick List ([1885]1991). Hamilton was a founding

father of the United States. Writing in the 1790s, he urged Ameri-



cans to protect their manufacturers from foreign competition so that they could industrialize and increase their power. Almost a hundred years later, List argued that Germany should industrialize behind trade barriers so that it could catch up with the economic might of Great Britain. He believed that only the economically strong advocated free-trade policies because other states would lose out in the ensuing competition. While Great Britain led the Industrial Revolution in the early 1800s and opened up its borders to free trade, both Germany and the US followed more economic nationalist policies.

One central question for students of the contemporary global economy relates to the persistence of mercantilist thought. It could be assumed that an economic perspective based upon unrivalled state power is of limited relevance in a world characterized by globalization. While this may be correct, contemporary economic nationalist thought should not be dismissed as some atavistic throwback to an earlier era. It reflects, on the one hand, an acknowledgement that states remain at the centre of power within the global political economy and, on the other, that there is an intimate connection between power and wealth. Economic nationalist thinking, whether it is termed‘neomercantilism’ or ‘statism’, remains important in both analysis and practice in the contemporary global economy. For example, states may protect strategic industries against foreign rivals or attempt to export more than they import for long periods of time. Japan has been accused of being a mercantilist state because in comparison to other advanced industrial- ized countries its economy is relatively closed. Even states that are generally seen to follow liberal policies, such as the US, will pursue economic nationalist policies in particular sectors. For example, the US uses defence spending to support its commercial aero- space industry.

Key actors

Economic nationalist or mercantilist theories view the state as the main actor in the global political economy. A major assumption of economic nationalists is the primacy of the political over other aspects of social life. Statist writers focus on the group (the state or nation) rather than the individual. Economic nationalist thought begins from two major assumptions. The first




is that the inter-state system is anarchical and it is therefore the duty of each state to protect its own interests. At the core of the various historical versions of economic nationalism is the belief that an economic community persists and acts for the good of all its members. The second assumption concerns the primacy of the state in political life. As the state is the central instrument through which people can fulfil their goals, it follows that the state remains the pre- eminent actor in the domestic and international domains. Economic policy should be used to build a more powerful state.

From this perspective, the state is prior to the market and market relations are shaped by political power. Economic nationalist thought is both descriptive and predictive. Descriptive economic nationalists maintain that production, consumption, exchange and investment are all governed by political power. Markets are not ‘natural’; they can only exist within a social context. For mercantilists, political needs and purposes are seen largely as being achieved through the form of the state. It remains at the core of social life. But economic nationalists move beyond description and also provide policy advice. Given their analysis of the dynamics of political economy, such advice is geared towards supporting and maintaining state power.

Economic nationalists recognize the importance of market-based actors such as firms, but subordinate their importance to that of the state. Within this perspective, the economic power of transnational corporations (TNCs) is acknowledged, but the overall power of such firms remains limited. In the end firms are subject to the dictates of states. Insofar as firms have become important economic actors, this is only because states have abandoned regulation or lessened controls on the movement of capital. When firms encounter economic or political trouble, they quickly turn to their home states for protection.

Key dynamics

From an economic nationalist perspective, international political economy is constituted through the actions of rational states. If international relations are conceived as a struggle for power, international political economy is a struggle for power and wealth. The determination of a state’s fate resides in its ability to ensure that its citizens reap advantages from interna-

tional production and exchange. Market relations are important indicators of power and wealth but the market is governed by the activities of states. Economic activity is subordinate to political goals and objec- tives. Furthermore, economic actors are subject to political authority. The consequence of the salience of the state is that international economic relations are international political relations. The global economy in this view is subordinate to the international political system.

IPE scholars working in this perspective argue that the nature of the global economy reflects the interests of the most powerful states. For example, Krasner (1976) has suggested that systems of free trade are most likely when a single power dominates the international system. This dominant, or hegemonic, power is needed to provide leadership and absorb the short- term costs of maintaining a free-trade regime. Analysts such as Gilpin (1981) have argued that changes in the distribution of power between states increase the chances of conflict in the international system. Because of this view, considerable time can be devoted to contemplating the rise and fall of great powers (Gilpin,1987; Kennedy, 1987).

In the heated debate over globalization, both defensive and sceptical economic nationalist perspectives can be heard. The defensive posture arises from a fear that globalization may prevent state actors from fulfilling their goals. This is, of course, merely the continuation of the long-held suspicion of economic exchange held by economic nationalist thinkers. Unlike proponents of free trade, economic nationalists believe that the gains from trade are unequally distributed and favour those with greater economic and political power. Thus, defensive economic nationalists can recognize globalization as a threat and seek to counter its impacts. On the other hand, sceptical economic nationalists reject many of the current liberal arguments about globalization. They contend that globalization is largely a myth and that the power of the state remains undiminished. Since economic actors are subordinate to political power, these analysts argue that the policy environment conducive to globalization has been created by states. It therefore follows that states can alter this environment by changing their policies. Moreover, it can be claimed that since states remain powerful actors and the only legitimate centres of authority in the modern world, nothing significant has occurred in the global political economy.




Conflict and cooperation

Within IR theory, realism, with its focus on the primacy of the state, the anarchical nature of international relations and the inevitability of conflict, provides the foundation for economic nationalist thought. If realism is the perspective in international politics, economic nationalism is its equivalent doctrine in political economy. Both share a commitment to the state and to the role of power in social life. Power- based theories such as economic nationalism and realism view the world as anarchic, lacking any central authority. Relations between states are thus characterized by unending conflict and the pursuit of power.

International economic relations are therefore perceived as a zero-sum game where the gain of one party necessitates a loss for another party. The system’s structure is perceived in conflictual terms. While economic nationalists believe that market relations can be positive, they think that such activity can also be negative. Since participating in markets is potentially negative, economic nationalists argue in favour of state control of key economic activities or for state assistance to central economic sectors. The continued salience of economic nationalist perspectives is easily visible today in production, consumption, trade and investment. In terms of production, economic nationalist sentiment is visible in arguments concerning the continued production of some good or service within particular national borders. This can be seen in terms of security concerns; that is, a state should not be reliant on the import of a specific good, because in times of conflict, this good may become unavailable. Some countries, such as France, protect their agricultural sector, while the US defends defence technology. It can also be seen in terms of the preservation of the cultural values of the nation. For example, many economic nationalists believe that it is vital to maintain the production of certain cultural products, such as films and music, within national borders. In relation to consumption, economic nationalist arguments have been made against cultural imperialism, that is, in favour of the view that the import of some products pollutes the nation through the introduction of foreign values. Whereas a liberal would argue that the sovereignty of the consumer is paramount, economic nationalists maintain that the values of the nation are more important. From the foregoing, it is easy to see how, in the sphere of exchange, economic nationalists

support the protection of domestic industries. Further- more, economic nationalist thought is behind arguments that seek to restrict foreign investment, and supports the ‘rights’ of local investors over foreigners.

Economic nationalism today

Although the dominant approach to global political economy as espoused by the leading international institutions and economic theorists is liberalism, economic nationalism continues to inform thinking and action. Countries continue to protect their markets from foreign competition even though they have committed themselves to free trade. Although protectionism has been reduced as countries have lowered tariffs, many other mechanisms are used to keep out foreign products. Chapter 6 reviews how states have used a variety of reasons to restrict trade, for example health and safety, environmental, cultural, employment, infant industry. Trade in services such as education and healthcare is a particularly sensitive subject that many states are unwilling to open up to foreign competition.

States have actively involved themselves in supporting particular industries, contrary to liberal theory. Many developing countries have relied on their states to boost economic activity, shield domestic industries from competition, and direct finance to selected industries. China has enjoyed remarkable economic growth, but has imposed strict conditions on foreign investment, intervened to make sure its currency is relatively cheap, and guided finance into particular activities through five-year plans. While benefiting from a generally liberal and open economic system, China has engaged in economic nationalist policies in pursuit of development.

Concerns about economic nationalism increase in times of economic downturn. Politicians and the public may wish to increase discrimination against foreign economies and firms when growth slows in the belief that steps should be taken to support national economies. Such an approach risks retaliation and the closing of world markets, which damages the interest of all states because it reduces the possibility of growth through trade. Protectionist policies of the 1930s are often blamed for worsening the Great Depression and this lesson is used against those advocating economic nationalist policies.

Visually, the economic nationalist approach can be




represented by a game of marbles (Figure 1.1). The marbles are states, with different attributes, varying in

their design, size, strength and beauty. They crash into each other in a competition to determine a winner.

Box 1.1

Profile: Susan Strange – unorthodox realist

Susan Strange (2002) admitted that she never meant to become a professor, but ended up in the role after stints in journalism (with The Observer and The Economist) and working at Chatham House, a British foreign affairs research institute. She eventually became a professor at the London School of Economics and Warwick University.

Strange’s theoretical approach is difficult to characterize neatly (Tooze and May, 2002). It contains a strong element of power politics or economic nationalism because it focuses on the exercise of power and pays considerable attention to key state policies in structuring the global economy. Strange takes a realist approach by advising students to focus on the role of interests and to constantly ask the question ‘Who benefits?’ Yet, her work is also unorthodox because she urges observers to take account of the role of markets, corporations and technological innovations in changing the environment in which the state operates. In a series of exchanges with US IPE scholars, Strange continuously went against the mainstream by variously arguing that the study of regimes was faddish and mistaken (1982), that US hegemony was not declining in the 1980s (1987) and that globalization was transforming the nature of state authority (1996).

Strange viewed IPE as a method of understanding the world that focused on the relationship between markets and authority. She argued that IPE should be an interdisciplinary area that brought together IR and international economics. Her broad approach is set out in a 1988 textbook called States and Markets, which argues that in addition to relational power (A forces B to do A’s will), power resides in structures. Structural power is the ability to shape the rules of the game in a particular area. Those who create the operating framework for everyone’s activities exercise power by eliminating some possibilities and making some outcomes more likely than others. Strange maintained that there were four key structures of power (security, production, finance, knowledge) and numerous secondary structures (transport, trade, energy, welfare). Strange reasoned that since the US exercised considerable structural power in the key structures, talk of decline was mistaken.

In the 1990s, Strange increasingly turned her attention to non-state actors. A major collaboration with a business school professor (Stopford and Strange, 1991) argued that traditional notions of diplomacy being an inter-state practice had to be expanded to include state–firm and firm–firm interactions. In a following book, Strange (1996) identified other actors such as business associations, bureaucrats and even mafias that were operating transnationally and undermining the authority of states.

Most of Strange’s empirical work was in the area of finance and credit. She argued that the creation and control of credit was a significant source of power in the global economy. True to her realist roots, she traced the liberalization and globalization of finance to particular decisions or non-decisions of the most powerful states. Finance was globalized because it suited the interests of the most powerful states (principally the US and the UK). However, Strange also worried that the failure of states to exercise proper regulatory control over financial flows was turning the system into a form of ‘casino capitalism’ (1986). Her fear was that a widespread financial collapse would lead to a closing of the global economy (1998).

Strange played a prominent role in founding and supporting the study of IPE as an interdisciplinary field in Britain. Her pioneering studies in the field of finance inspired a new generation to examine the power relations flowing around credit issues. Strange’s insistence that IPE be an open field of intellectual enquiry influenced the development of the field in Britain by bringing in work from a number of different disciplines. Her stinging criticism of US intellectual trends provided room for British scholars and students to ask different types of questions and use different methodologies from their US counterparts.




Figure 1.1 Economic nationalism as marbles

The Liberal PerspectiveIn contrast to the economic nationalist theories, liberals focus either on the individual or a wide range of actors from the state to the corporation to interest groups. They do not see the state as a unitary actor, but as influenced by numerous factors. Rather than stress the inevitability of conflict, liberals search out the

conditions for cooperation. They tend to play down the role of force and coercion in human affairs and emphasize the ability of individuals to choose between attractive courses of action or negotiate their differences. Liberals see the world system as one of interdependence rather than anarchy. States and peoples can cooperate for mutual benefit in the liberal view. Rather than a zero-sum game where one’s gains are the other’s losses, liberals see a positive-sum game where the pie grows bigger and everyone gains. Box 1.2 examines the debate over relative verses absolute gains.

Liberal theories of political economy emerged in18th- and 19th-century Britain alongside the Indus- trial Revolution. They offered a critique of economic nationalist thought by arguing that protectionism and restriction of economic activity were actually impoverishing states. Scottish moral philosopher Adam Smith ([1776]1983) advocated freeing up commerce and creating larger national and international markets as a method of generating wealth for everyone. Englishman David Ricardo ([1817]1992) introduced the revolutionary theory of comparative advantage, which demonstrated that all nations can

Box 1.2

Relative versus absolute gains

In many ways, disagreements between economic nationalists and liberals can be traced back to differences over relative and absolute gains. Relative gains refer to one actor doing better or worse compared to another actor. Absolute gains refer to whether an actor is better off compared to a previous point in time. Economic nationalists and their international relations cousins (realists) argue that since states are in competition with each other, their primary concern is how a state performs relative to its rivals. Does a particular arrangement increase or decrease the gap between states? In contrast, liberals believe that states are rational and will support measures that will increase their absolute wealth the greatest amount.

As an example, imagine that the US and China were presented with two economic agreements that would govern their relationship for 20 years. Under agreement A, which involves carefully managing trade between the two countries, the US will grow at an annual rate of 2% and China will grow at an annual rate of 2%. Under agreement B, which involves a broad free-trade deal, the US will grow at an annual rate of 5% and China will grow at an annual rate of 10%.

An economic nationalist would opt for agreement A because it delivers similar benefits to both countries, whereas agreement B causes China to grow much faster than the US. Liberals would disagree, arguing that the US should sign agreement B because it would increase growth by 5% each year rather than the meagre 2% of agreement A. The free-trade arrangement will make the US richer and more prosperous than the managed trade agreement. A focus on relative gains would lead policy makers to prefer agreement A, while a focus on absolute gains would lead policy makers to choose agreement B. Which do you thinkthe US should sign?




benefit from free trade even if they are not as competitive as other states.

Today’s global economy is governed largely according to liberal principles. The trade regime is based upon the goal of free trade, money flows into and out of most countries without great difficulty and all forms of economic activity are increasingly liberalized. However, there is a wide variety of liberal thought. It ranges from those who see the state fading away in an emerging borderless world dominated by corporations (Ohmae, 1990) to liberal institutionalists (Keohane and Nye, 1977), who stress the continuing importance of the state, but see it enmeshed in webs of interdependence and international organization. The book by Landes (1998), mentioned in Chapter 3, takes a particular type of liberal approach. It argues that those with liberal values have been most successful in the global economy and implies that these values were freely chosen by people in Europe and the West. However, Landes parts ways with those liberals who argue that individual choice is more significant than cultural institutions.

Key actors

Within the liberal perspective there are a number of key actors. For liberals, the starting point of analysis is the individual. Liberal economic theory, of which neoclassical economic theory is a variant, begins from the analysis of individual wants and preferences and constructs a powerful explanatory framework on this basis. In the context of analysis of the global economy, liberal theorists focus on the behaviour of individuals, firms and states. In contrast to economic nationalism, the key economic actor is the individual rather than the state. Individuals in pursuit of self-interest will maximize the benefits of economic exchange for society. Within liberal theory the firm also plays an important role. Unlike mercantilists who view the firm with a degree of suspicion, liberals see the firm as a source of economic wealth. The state is viewed with hostility by many liberals since it brings politics into the realm of economics. Liberals believe that if individuals are left freely to engage in production, exchange and consumption, all will benefit and that the inser- tion of state control distorts benefits and adds costs to participants in the market. People engaged in free economic exchange pursuing their own interests create

a society-wide harmony of interest. From a liberal perspective the TNC is a positive force. TNCs bring advantages to both home and host countries. From the perspective of the home country, the TNC represents an optimal mix of technology, managerial skill and capital. For host countries, TNCs boost their economies through the transfer of capital, technology and access to markets.

Key dynamics

For liberal theorists the market lies at the centre of economic life. Economic progress results from the interaction of diverse individuals pursuing their own ends. While liberals acknowledge that market relations are not always optimal, they tend to argue that intervention in the market is most likely to produce suboptimal outcomes. There is, of course, a broad spectrum of liberal thought. It ranges from John Maynard Keynes (1936), whose economic theories laid the foundation for interventionist, welfare governments in the immediate postwar period, to Friedrich Hayek (1944), whose free-market philos- ophy guided the neoliberal revolution of the 1980s. They both subscribe to a belief in the positive role of markets and the ability of the market to lead to prosperity. However, they differ over the importance of market imperfections and the policies that ought to be implemented to deal with market failure.

For liberal theorists, IPE is constituted by a search for wealth. On the whole, open markets will enhance growth and wealth, and firms will disseminate material wealth across the globe. Economic failure in this perspective is often the result of government intervention. Many liberal theorists have been at the forefront of the debate on globalization. For what can be termed‘hyper-liberals’, globalization is not only a reality (indeed, an inevitability), it is a positive force for good. Globalization breaks down artificial (for which read political) barriers and by unleashing the force of production, it can contribute to enhanced happiness for humankind. Thus, hyper-liberals welcome globalization. Keynesian-influenced liberals or those of a reformist stance perceive certain problems with the unfettered operation of the free market and are, therefore, sensitive to some unwanted consequences of globalization. They support globalization but emphasize the need for attention to market reform.





Liberal theorists view international relations and the international political economy as essentially cooperative. Indeed, they believe that market relations will lead to positive outcomes for all. In other words, economic relations are positive sum. A standard liberal theory that exemplifies this belief is the theory of comparative advantage, which shows that even in a situation where one country enjoys a superiority in the production of all goods and services over a second country, trade between the two countries will benefit both countries. This is explained in more detail in Chapters 4 and 6.

One persistent liberal belief has been that economic nationalist policies lead to conflict. Unlike Marxist writers who denounce the growth of global capitalism as a cause of war, liberal theorists view increased international interaction as a source of prosperity and peace. The liberal belief in the connection between protectionist policies and conflict and the reverse argument, namely that capitalism favours peace, are central to liberal critiques of the international economic order. The German philosopher Immanuel Kant ([1795]1991) foresaw an era of perpetual peace when systems of free trade, a coalition of republican states and the fear of destructive warfare would bring about an era of calm and prosperity. Towards the end of the First World War, US President Woodrow Wilson ([1918]1986) advocated liberal principles of free trade, self-determination and the use of international organizations to settle disputes between states.

The framers of international economic institutions after the Second World War were supporters of this view. It was argued that the war had its origins in the economic nationalist policies of the 1930s. As a consequence of the Great Depression, governments resorted to a series of protectionist measures that eroded confi- dence in international cooperation. As a result of economic nationalist policies, the basis of collective security was shattered and an atmosphere conducive to dictators was created. The shift from economic competition to military conflict was, in this view, inevitable. Hence, there was the need after the war to design institutions to foster international economic cooperation and to include within those institutions mechanisms to prevent states from resorting to competitively nationalist policies.

Within the study of IR, liberal theories of world politics and of political economy share assumptions

concerning the pluralist nature of the international system and the feasibility of cooperation. Theories of interdependence developed in the 1960s to explain the connection between increased economic exchange and interconnectedness and the long peace among Western nations after 1945. They echo classical liberal political economy. These theories emphasized the economic and political benefits of economic interchange. Inter- dependence was proffered as both a description of events and a prescription for the solution of conflict.

In the 1980s and 90s, liberals continued to argue that international cooperation was both possible and desirable. In contrast to economic nationalists or realists, liberals argued that international agreements or regimes would maintain international economic order even if hegemonic states declined (Keohane, 1984). With the end of the Cold War and the rapid spread of liberal economic models to many states in the 1990s, it appeared that the liberal faith in cooperation and progress was justified. Some even went so far as to claim that history had ended because the liberal democratic model had triumphed over other forms of social organization (Fukuyama, 1992).

Liberalism today

Liberal neoclassical economics, which stresses the importance of rational decision makers in free markets, dominates the field of economics. International institutions such as the World Trade Organization (WTO) are founded on liberal principles of free trade, while the IMF and the World Bank preach liberal prescriptions to those seeking development funds or loans to see them through financial crises. TNCs urge state leaders to open their markets to the free flow of investment and many government officials eagerly comply. Indeed, many states have bound themselves to an ever more liberal economy through participation in international organizations and international economic agreements such as regional or bilateral free-trade agreements. The market continues to expand by bringing in more and more countries as participants (such as China) and by encompassing a wider range of activities such as services (healthcare, education, child- care, housework).

Despite the dominance of liberalism, there are challenges to liberal theory and practice from within and without. Within liberalism, the 2008 financial crisis




Box 1.3

Profile: Robert Keohane – liberal institutionalist

Robert Keohane was born into an academic family and began a US teaching career after graduating from Harvard in 1966 (Keohane, 1989a). His academic career has taken him to Stanford, Brandeis, Harvard, Duke and Princeton universities. His research has had a major role in influencing the study of IPE and IR in theUS and beyond.

Keohane is a central figure in what has become known as the liberal institutionalist approach to IPE and world politics (1989b). This approach suggests that institutions or sets of rules and norms can have a significant effect upon state behaviour if they have mutual interests. Institutions include formal international organizations, international regimes or conventions and customs. Liberal institutionalism was developed as a critique of realist/power politics/economic nationalist approaches to IR and IPE. The emphasis is on how institutions can help states overcome barriers to cooperation. Although Keohane himself prefers to be known simply as an institutionalist (2002, p. 3), the adjective ‘liberal’ is still useful because it refers to some of the liberal attributes that underlie his approach. These include a focus on the individual and a belief that properly designed international institutions can go some way to creating a more humane global system.

Keohane’s first major work was written with Joseph Nye and it argued that there were certain times and issue areas when the assumptions of realist or power politics approaches did not hold sway (Keohane and Nye 1977). They labelled these situations as ‘complex interdependence’ and suggested that under certain circumstances states could use international institutions to bolster cooperation. They also argued that in such situations cross-border links between officials could lead to outcomes different from those that power politics approaches would have predicted.

In 1984 Keohane published After Hegemony. It sought to explain why, contrary to realist assumptions, states continued to cooperate and participate in international agreements even after the major power that sponsored the agreements entered a period of relative decline. This was a significant issue because many analysts were worried about the decline of US power relative to other states and feared that this would make the international political economy increasingly unstable. Keohane argued that the benefits of arrangements in issue areas (such as money, oil or trade) or regimes continued independent of the rise or decline of the power of particular states. Regimes exist because they facilitate negotiations between states and allow states to overcome barriers to collective action such as uncertainty. Keohane’s work helped to spark increasing attention to the issue of regime creation and maintenance. Indeed, regime theory became a mainstay of US IPE scholarship.

Another important aspect of After Hegemony was Keohane’s use of economic theory to explain the activity of states. Drawing inspiration from economic theories that claimed to explain the activity of corporations, Keohane analysed state behaviour in terms of market failure, transaction costs and uncertainty. Market failure refers to a situation where transactions do not take place because the market is arranged in such a way as to make otherwise rational activity irrational. In the case of IPE, states might not agree to cooperate because they are unsure of the motives of other states. Regimes help to resolve this market failure by providing information about other states’ behaviour and an element of predictability in inter-state interactions. States cooperated in international regimes because these regimes solved particular problems such as lack of information and uncertainty about other states’ intentions and behaviour. Keohane’s use of economic models and theories of rational choice coincided and blended well with the importation of economic models in other areas of US political science. The success of his book and persuasiveness of his argument helped to bolster rational choice methodology in US IPE.

Keohane’s work has been important in the field of US IPE because it has advanced understanding of how states are able to cooperate through international regimes.




reopened the debate among liberals about regulation and the role of government in economic crises. Does self-regulation of financial firms lead to economic effi- ciency or corruption and financial collapse? Should governments bail out banks with taxpayers’ money or should they be allowed to go bankrupt? How should governments respond to financial and economic crises? Is government’s role to balance budgets or spend to jump-start economic growth? What should governments do if economic growth stalls?

There are also challenges to liberalism from those who do not accept its claims. States may be happy to export into an open liberal market, but reluctant to expose their own industry to competition, as we will see in the chapters on international trade and development. Harmed by rapid capital flows, other states may seek to intervene in the financial markets to slow the movement of money between countries or restrict the conditions under which investment takes place. Other groups may challenge liberalism because they advocate different agendas, such as labour rights (Chapter 9), gender equity (Chapter 10) or environmentalism (Chapter 12). A common criticism is that the liberal view underestimates the significance of powerful firms and states and their ability to distort and manipulate markets.

A visual representation of liberal IPE theory is the cobweb (Figure 1.2), where a giant web of interdependence connects actors such as states, corporations and people in a complex set of relations.

Figure 1.2 Liberalism as a cobweb

The Critical PerspectiveMarxist theory emerged in the 19th century in reac- tion to liberal thought. Marxism’s critical approach to liberalism can be seen in a number of other bodies of thought that move away from the individual and states to consider other units of analysis. They are sometimes called ‘critical theories’ because they question the way the world is organized and seek to change the world. They are sometimes labelled as ‘radical’ because they challenge established forms of organization. The three most common variants of critical thought in IPE are Marxist, feminist and environmentalist theories. Post- structuralist and cultural political economy approaches have also recently been applied to IPE. This chapter concentrates on Marxist theories, while feminist theories will be highlighted in Chapter 10, environmental theories in Chapter 12 and poststructuralist theories in Chapter 13.

Marxist theories focus on class and the interests of workers rather than state interests. Writing during the English Industrial Revolution, Karl Marx took issue with the idea of a harmony of interests that the liberals advocated. Marx and his co-author, Engels, discerned an ongoing conflict between workers and capitalists that would only be resolved when the workers seized power (Marx and Engels, [1848]1977). Feminists also see a world of exploitation but their theories look at gender relations between women and men. They seek to uncover how our ideas about what men and women are supposed to be shape the ways in which society is organized. Mary Wollstonecraft ([1792]1992), an18th-century early feminist writer, criticized male liberal theorists for ignoring the role and interests of women in their political theories. Green theories have taken the environment and the planet as the objects to be highlighted. They examine how people shape and are shaped by the environment. Neo-Gramscian theories, which evolved out of Italian Marxism, stress the role of transnational classes and ideology in their efforts to understand the global economy. We use the term ‘critical’ as a label for these theories because they are united by a critical attitude to prevailing social arrangements. Here, we focus on Marxism since it is the oldest of the theories grouped under the critical perspectives heading.

These critical theories stress the nature of oppression within and across societies and the struggle for justice waged by or on behalf of workers, women and




the environment. Frank’s (1998) study, ReOrient: Global Economy in the Asian Age, is close to this form of analysis because he stresses European exploitation of others’ resources in the ‘rise of the West’. However, he differs from traditional Marxists who have seen Western civilization as being at the forefront of human development because it was the birthplace of capitalism. Frank disputes both the claim that capitalism originated in Europe and that European developments are more significant to world history than developments in Asia.

Key actors

Marxist writers begin with a focus on class as the main‘actor’ in the global political economy. They reject the individualism of liberal theory and embrace the collec- tivist approach of economic nationalist perspectives. However, Marxist theory rejects statism and focuses instead on the significance of class. This focus arises from the Marxist account of capitalist relations, which are predicated on exploitation. The Marxist concept of class has been open to various interpretations and critiques. We define class simply as arising from one’s position in the structure of production. Marx defined class in relation to the structure of production, which creates owners of the means of production (the bourgeoisie) and the labourers who sell their labour power to the bourgeoisie (the workers).

Within Marxist writing the firm is an instrument of exploitation. TNCs contribute to the exploitation and oppression of the working class. The centralization and concentration of capital visible in the form of TNCs is a key feature of imperialism, whereby dominance is expressed in the global political economy. In this perspective, the state is the representative of class interests rather than the expression of the harmony of communal interests posited by economic nationalists.

Key dynamics

Dominance and exploitation among and within societies provide the main dynamic for Marxist theories of IPE. Unlike liberals, Marxists view market relations as inherently exploitative. Under capitalism, workers are denied a fair remuneration because capi-

talists pay workers less than their labour is worth. Marxists view international economic relations as



inherently unstable and conflictual because of three tendencies of capitalism:

1 The tendency for the rate of profit to fall sees capitalists engaged in fierce competition with each other and it will tend to drive down workers’ wages.

2 Capitalism leads to uneven development as some centres increase their wealth and growth at the expense of others. Uneven development sows the seeds of conflict between countries.

3 Marxists argue that capitalism leads to overpro- duction or underconsumption, giving rise to fluc- tuations in the business cycle and undermining social stability.

A revision of Marxist thought called ‘dependency theory’ has been used to explain the persisting poverty of many states. Dependency theory suggests that poor countries faced immense obstacles to development because they were vulnerable to economic exploitation from developed states (Dos Santos, 1970). The links between the rich and the poor were thought to make the poor poorer and the rich richer. Underdevelop- ment of some parts of the world was caused by development in other parts of the world. This school of thought informed developing countries’ attempts to create a New International Economic Order in the1970s (Cox, 1979). This approach was undermined in the 1980s as many developing states adopted liberal economic policies in the wake of the debt crisis.

Radical theorists have tended, for a variety of reasons, to oppose globalization. It has been argued, for example, that globalization is a myth or merely imperialism in modern clothes. According to this argument, globalization represents an ideological intervention into political economy. It ostensibly describes changes in the world but, in reality, it is a set of prescriptions in support of free markets and an instrument to increase the power of capital over labour, the West over other states, and an instrument designed to further the interests of the leading capitalist power, the US. In this sense, globalization has to be resisted since it too maintains and increases exploitative relations. At the heart of the radical argument is the view that globalization is not distinctive, that is, discussion of globalization is merely the contemporary version of imperialism. To discuss political economy in terms of globalization may mask real power relations.

In the 1980s and 90s, Marxist IPE was reinvigorated




by the work of scholars drawing inspiration from Antonio Gramsci. Writers such as Robert Cox (1996a) and Stephen Gill (1993) focused on the role of social forces and ideology in liberalizing and globalizing economic relations. They argued that globalization based on neoclassical liberal economic principles was a political project that transformed national states into instruments of global liberalization and economic management. Part of this project involved convincing people that neoliberal policies were actually in their best interest. In this view, the hegemony of a particular world order requires an ideological dominance that secures the broad consent of those ruled in an unequal and unjust manner.


Critical writers tend to perceive international economic relations as a zero-sum game. The structure of global capitalism is fundamentally conflictual. Two forms of conflict are prevalent in the global economy. Within states, capitalists and workers have competing interests and the state is the scene of a class struggle as the workers and bourgeoisie clash. According to Marxists, this conflict is objective and arises from the law of motion of capital. In the international arena, the clash between workers and capitalists is often obscured by nationalism and the intervention of the state. Through the mechanism of imperialism, dominant states oppress weaker ones and this sets up an international struggle between imperialists and their victims.

International conflict is inevitable because of the drive for profit. Different capitalists seek the protection of their state and this leads to war. Marxist theories of imperialism have, in different ways, accounted for the tendency of capitalist states to go to war. Lenin’s theory of imperialism, the most well known of these theories, combined two different explanations of capitalist development. One part of his theory focused on underconsumption in domestic markets. Because of underconsumption, capitalists were compelled into overseas adventures since they could not maintain their rates of profit on the basis of domestic demand. Another part of his theory focused on the growth of finance capital and the merger between finance and industrial capital to form monopoly capital that sought to gain profit through overseas lending. He

argued that conflict and war are a necessary end result of this competition.

At the turn of the 21st century, conflict between social forces was also seen to take place on a global scale. Elites attempting to constitutionalize neoliberal principles in institutions such as the WTO and the IMF met with opposition from social movements trying to safeguard environmental regulation, raise labour standards, improve gender equity and lobby for economic justice (O’Brien et al., 2000). Critical analysts depict a global conflict that takes place within, above and across states (Gill, 2003).

Critical theory today

With the demise of the Soviet Union and communism, Marxist states ceased to exist. The critical perspective lives on in a number of areas, however. As a form of analysis critical of capitalism’s inequalities and recur- ring crises, Marxism continues to have adherents. Although Russia and China eventually embraced a capitalist model, many of the problems of capitalism have not been resolved. The financial crisis and ongoing austerity since 2008 have led to renewed interest in Marxist critiques of capitalism, such as Harvey’s (2011) The Enigma of Capital. In particular, the political power of financial capital is a subject of vigorous debate, as financial institutions have pros- pered in the face of the crisis, while populations have borne the brunt of austerity. To give just one example, many Wall Street bankers continued to receive financial bonuses on top of their salary, while the wealth of the average American family declined by 40 per cent between 2007 and 2010 (Lee, 2012).

Other groups that also question the power imbal- ances and inequality in the global economy often draw on some version of critical approaches. For example, development groups struggling against rules of trade or finance that disadvantage poor countries highlight the rigged nature of the game. Social movements organizing against the lack of education and employment opportunities for girls can draw on a feminist analysis. Environmentalists concerned about the devastating effects of economic growth and runaway consumption put the health of the planet ahead of individuals or the state. We will return to these variants later in the book.

A visual representation of critical IPE theory is the




layer cake (Figure 1.3), where groups are stacked in layers across the global political economy, with some

classes (or genders, or races or species) on the top and others on the bottom.

Box 1.4

Profile: Robert Cox – historical materialist

For Canadian-born Robert Cox academic life was a second career after spending 25 years in the International Labour Organization (ILO). At the ILO, Cox served as a staff officer to the director general, chief of the programme and planning division, and as director of the International Institute for Labour Studies. After leaving the ILO, Cox took a teaching position at Columbia University in New York before settling atToronto’s York University in 1977.

Cox describes his approach to IPE and IR as historical materialist (2002a, pp. 27–9). The historical part involves recognizing that each historical era has a particular sensibility and set of institutions and understandings. This contrasts with approaches claiming that there are universal laws of human behaviour which apply across time. The materialist part places the organization of production and the social relations around production at the centre of analysis. In other words, class and class conflict play an important part in understanding political economy. Central to Cox’s work has been the idea that ‘production generates the capacity to exercise power, but power determines the manner in which production takes place’ (1987, p. 1). He takes a particular approach to historical materialism, which mixes theoretical insights from Marx with those of scholars such as Vico, Sorel, Weber, Gramsci and Polanyi. The result is that many liberals and economic nationalists label Cox a Marxist, while many Marxists argue that he has deviated from the Marxist path (Schechter, 2002).

As the title of a collection of Cox’s essays indicates, his primary interest has been Approaches to World Order (1996a). Cox’s experience at the ILO and his study of international organizations prompted him to think about the nature of power and dominance in the global economy. Cox (1983) theorized that powerful states exercise a form of hegemony that goes far beyond military strength. Hegemonic states, such as Britain in the 19th century or the US in the 20th century, drew their power from a particular form of production and social relations. Hegemony requires dominance in the economic, political, social and ideological realms. A hegemonic power is able to convince others that their interests are the same as those of the dominant power. As a result, hegemonic states try to express their interests as universal norms and use international organizations to influence other states.

Cox (1986) also argued that it was a mistake to focus on the state and ignore the role of social forces. Social forces are groups of people who occupy a particular place in the global economy by virtue of their role in the organization of production. Some social forces, such as the people who own or work in an internationally competitive industry, advocate free trade, while other social forces will oppose free trade as a threat to their interests.

In the theoretical realm, Cox (1986) was significant for highlighting the differences between critical theory and problem-solving theory. Problem-solving theory looks at the world as it is and concentrates on how issues can be addressed in the existing system. Critical theory stands back from the existing order and asks how that order came about and under what conditions it could be changed to a different form of order. Critical theorists seek to contribute to a better social order, thus they embrace emancipatory strategies. Problem-solving theory is about managing the system and critical theory is about changing the system. Most radical analyses that call for major changes in the global political economy fit into this critical category.

Cox’s most significant impact in the study of IPE has been to raise critical questions about the system of international order and to contemplate how one might achieve a more egalitarian and sustainable system. This has led him to disagree with the normative and practical implications of economic liberalism, the fatality of economic nationalism and the dogma of fundamentalist Marxism.




Figure 1.3 Critical theory as a layer cake

Contending Perspectives: A Summary

The question arises as to why there are so many theories and what the relationship is between various theories. There are several reasons for the existence of multiple theories. According to Cox (1986, p. 207):‘Theory is always for someone and for some purpose.’ Each theory has a different goal in mind. For example, economic nationalist theories are concerned with the security of the state, liberal theories with building

wealth or cooperation and critical theories with pursuing economic, gender or environmental equity. While they are all trying to understand the world, they are looking at different aspects of human existence. A second and related reason is that a particular theory usually advances the causes or interests of a particular group. Richer, more satisfied people and states tend to favour liberal theories that do not threaten their interests, while those disadvantaged by the system are more likely to espouse critical theories. A third explanation is that it is impossible to prove a theory right or wrong. Evidence is often disputed and interpreted in different ways. Moreover, unlike the laws of nature, people are able to reflect upon their behaviour and change their form of organization and interaction. People may act according to mercantilist theories in some eras or situations and along liberal principles in others.

Table 1.2 presents a summary of the perspectives. In the discussion so far, our intention has been to highlight the existence of various interpretations. But what is the relationship between various theories? Are they in

Table 1.2 Comparing the perspectives

Aspect Economic nationalist Liberal Critical

Historical origins 15th century 19th century 19th century

Major figures Hamilton, List, Krasner, Gilpin, Strange

Smith, Ricardo, Kant, Wilson, Keynes, Hayek, Keohane, Nye

Marx, Lenin, Frank, Cox

Variants Mercantilism, realism Free trade, interdependence Marxism, feminism, environmentalism

Level State-centric, atomistic Pluralist atomistic Global structure

Human nature Aggressive Cooperative Malleable

Units States Firms, states, NGOs, IGOs, individuals

Class, gender, planet, global capitalism

View of the state Unitary actor Pluralist state: diverse interest Representative of class interest groups

View of TNCs Beneficial/harmful Beneficial Exploitative

Behavioural dynamic

State as rational actor Individual as rational actor but outcomes not always optimal

Dominance and exploitation within and between societies

Market relations Potentially negative Positive Exploitative

System structure Anarchy/conflictual Cooperative/interdependence Hierarchy/conflictual

Game metaphor Zero sum Positive sum Zero sum

Hegemony Importance of a dominant state Post-hegemonic cooperation Hegemony in state and society

International institutions

Not very significant Important Serve interests of wealthy(states, firms and classes)




conflict or can they be made compatible? At their core, theories about IPE are incompatible because they have different basic assumptions about the units of analysis, the nature of the system and the motivation of actors. Yet, each theory can point to some evidence to support its existence and each seems to be useful in explaining some aspect of the global political economy. Some theorists (Strange, 1988) have suggested that people take an eclectic approach to theory – picking and choosing as they wish. This can have some advantages, but risks incoherence as one jumps from perspective to perspective. Readers should consider some systemized form of integration, where various theories may be used under particular circumstances or in a hierarchy. For example, one could have a general power politics approach while conceding that the system is also characterized by class and gender exploitation and that there are times when cooperation can be more beneficial than conflict. Alternatively, some theories may be more applicable in selected time periods.

IPE brings together knowledge from a number of fields and disciplines to increase our understanding of the relationship between economics and politics across the national/international divide. Economic nationalism, liberalism and critical theories are three broad schools of thought in the field, which both explain the behaviour of actors and offer prescriptions about what states and people should do in the global political economy. In Chapter 2, we turn our attention to the evolution of the field and methods used to study it.

Further Reading

A wide-ranging and eclectic collection of articles examining IPE theory can be found in Ronen Palan (ed.) Global Political Economy: Contemporary Theories 2nd edn (2012). Susan Strange outlined her critique of runaway finance in Mad Money: When Markets Outgrow Governments (1998), while an overview of her work is presented in Roger Tooze and Chris May (eds) Authority and Markets: Susan Strange’s Writings on International Political Economy (2002). Robert Keohane’s ground-breaking work on regimes is found in After Hegemony (1984), while a collection of important essays is contained in his International Institutions and State Power: Essays in International Relations Theory (1989). Many of Robert Cox’s most influential writings are contained in (with T. Sinclair) Approaches to World Order (1996). A critical feminist take on GPE is V. S. Peterson’s A Critical Rewriting of Global Political Economy: Integrating Reproductive, Productive and Virtual Economies (2003).

Two journals that publish a great deal of IPE analysis are Review of International Political Economy, available at www.tandfonline.com/toc/ rrip20/current, and New Political Economy, available at www.tandfonline.com/toc/cnpe20/current.



index

Abu-Lughod, Janet 26, 44–5, 46,48, 66

absolute advantage 76, 77, 111 absolute versus relative gains 13,

113Africa 43, 45, 46, 49, 54, 55, 95,

96, 98, 99, 102, 177, 182, 185,186, 256, 269, 272, 281, 289,293, 297, 301, 308, 31015th century 48Cold War 90 debt 167–9, 238 development 221, 223, 225,

228, 231, 235financial flows 140, 144, 167,

190gender 201, 206scramble for 68, 74, 77, 79–81,

83, 90slave trade 56, 57–9, 62, 63,

64, 65technology gap 267trade 110, 117, 123, 124, 125,

128, 129see also individual countries,

Congoagency

and change 202, 207 and structure 37, 38

Agenda 21 250agrarian question 198–9 agriculture, 94, 99, 103, 183, 198,

2991400–1800 55, 56, 61, 62 development 213, 230, 235,

279division of labour 204, 205,

206trade 124–5

aid see economic aidAlgeria 95Americas

15th century 48–9 conquest of 54–7 dollarization 162–3see also MERCOSUR, NAFTA

anthropocentric 243, 245anti-dumping 118, 121, 122, 258 anti-globalization movement

102see also civil society, Occupy

Apple 99, 100, 140, 193, 286Argentina 69, 223, 227, 270, 306

Asiarelations with Europe

1400–1800 59–62see also individual countries

Asian financial crisis 96, 141,157, 158, 171, 233, 269, 300,308, 309rival interpretations 7–8

Asia-Pacific EconomicCooperation 128, 129

Asian values 96, 228see also Confucianism

Association of South East AsianNations 102, 103, 127

Australia 55, 60, 91, 153, 158,170, 215and asylum seekers 307 trade 110, 125, 127

autonomy 39, 47, 70, 89, 241,292, 302, 311 monetary 158, 161national 125, 149–51, 179–80,

296Ayutthaya 60Aztec Empire 45, 48–9, 65

balance of payments confusion over 157 and debt 229 defined 73and gold standard 73, 74 and IMF 155, 156, 157and TNCs 137, 138, 145,

147 balance of power 194, 217, 292,

29719th century 67–8, 72, 75–77,

82, 89‘Bangalored’ 192Bank for International

Settlements 102, 169, 170 banks

and financial instability 52 types 51see also finance

Baran, Paul 26Barings Bank 166Barnett, Richard 135Barraclough, Geoffrey 81 barter 51, 72, 110, 185basic needs approach 32, 230,

232, 233, 235, 305Basel Committee on Banking

Supervision 169

and the Congo 55, 78, 79, 80,81

Bhopal 251Biersteker, Thomas 98‘Big Bang’ 164 biodiversity 244, 253 bioprospectors 273Boli, John 102bonds 99, 134, 141, 163, 164,

174, 176, 177, 178, 179 explained 177

Boserup, Ester 222Braudel, Fernand 66, 186Brazil 96, 98, 199, 227, 241, 259,

272finance issues 167, 168, 170,

268global governance 97, 123,

170, 237, 296, 300 pre-1900 55, 57, 58,

81TNCs 138, 148, 188, 301 trade 110, 117, 123, 128

Bretton Woods system 142,155–6, 229

Britain 12, 20, 55, 81, 87, 92, 155,

184, 187balance of power 75–7Bretton Woods 155ERM 161financial crisis 156, 158, 171,

173, 214financial deregulation 164 free trade 75–7, 280gold standard 72–5and India 61, 79, 186, 192Industrial Revolution 67,

68–72, 88, 90, 219, 271 interwar period 82, 84, 85, 86 and liberalism 9, 13, 67, 70–

1,197, 267, 268

and slave trade 58, 59see also Pax Britannica,

imperialism, United Kingdom

British East India Company 61,68

Brundtland Commission 233, 254 business associations 12, 195,

301, 302see also transnational

corporationsbusiness conflict theory 302Bush, George W. 129, 173, 180,

call centres 188, 192, 193Canada

dollarization 162–3pre-1900 57, 60, 62, 68 trade 110, 118, 168

canals 52Grand 47Panama 70Suez 60, 70

capital account 157, 269 capital controls 85, 141, 148,

164, 171capital mobility 103, 137, 140,

141, 157–8, 159, 161, 170, 172,189, 269, 309

capitalism 87, 88, 89, 94, 131,199, 224, 268‘casino’ 12, 168 and conflict 283‘crony’ 7, 8, 172and development 219, 237, 245 and environment 246–7, 248,

249, 254 exploitation 18, 19, 21 financial crisis 34, 173 gender 203, 217and imperialism 79, 81 national 229–31, 296 origins 18and peace 15rival models 2, 8, 30–1, 34, 91,

96–7, 104, 297and underconsumption 18 uneven development of 18

Carr, E. H. 83Castells, Manuel 100Central America 92, 117, 143,

184, 291central bank 102, 156, 157, 158

159, 160, 163, 160, 174, 176China 175 defined 51European 161, 298 independence 184lack of international 72 lender of last resort 52, 85 reserves 73, 74Thailand 7Zimbabwe 162

Cerny, Phil 97Chiapas 170, 198, 232 children 57, 61

care for 101, 182, 214, 301

debt crisis 167, 170, 180 Beckerman, Wilfred 247 259, 288, 296 poverty of 210, 213, 220, 305nationalization of oil industry Belgium and sexual exploitation 183,

149 15th century 49, 50 Cairns Group 124, 125 214, 215, 303



trade 110, 125 Caldwell, Lynton 250 and work 67, 69, 88

332



Index | 333

China 19, 68, 69, 79, 81, 83, 88, codes of conduct 195, 198, 305 94, 101, 102, 119, 141, 152, and free trade 26, 28396, 198, 223, 281, 286, 300 Cold War 15, 91, 164, 197, 220, 196, 220, 228, 299, 304, 308 and global governance 91,15th century 44, 45, 46–7, 48, 230, 278, 303 critical views 19, 21 179, 309–11

49, 50, 53, 54, 55, 56, 60 characteristics 91–2, 104–5, economic nationalist views and peace 283communist period 86, 91, 94,

233 currency 176economic nationalism 11 environment 255, 255, 258, 259 financial crisis 171, 174, 175 and foreign investment 97, 98,

103, 133, 153, 216and global division of labour

15, 151, 183, 190–2, 193–4 and global governance 97, 98,

156, 170, 231, 296, 297 health 293and Japan 83 opium wars 61, 69 remittances 189sovereign wealth fund 165Taiping rebellion 69, 89 technology 267, 271trade 98, 123, 125, 127, 130,

146and US 13, 163, 176, 177, 255,

258working conditions 194, 195

Christianity 54, 57, 79, 80 cities 46, 48, 49, 52, 53, 55, 58,

60, 65, 67, 70, 98, 298, 299 civic associations

see civil society, nongovernmental organizations

civil society 36, 43, 100, 203, 224 debt relief and development

237–8, 308 environment 250global governance 196, 239,

267, 295, 302–4, 305, 308 international institutions 102,

129, 130, 209, 212, 236TNCs 152, 195

civilizationsAfrican 48, 70, 79American 48–9Chinese 46–7, 54Indian 47–8, 54interaction 44–5, 54–66, 109,

288Ottoman 54Western 18, 43, 44,

class 22, 38, 57, 183, 221, 306 capitalist 245landholding 62, 70in Marxist theory 17–21, 71,

203, 247, 264, 281 middle 170, 251 transnational 26, 289 and women 212, 215working 73, 74, 88, 89, 90, 93,

197

see also division of labourClinton, Bill 129, 196, 215,

259,274, 275, 291

283–4decolonization 95end of 101, 104, 233, 252, 278,

279, 283, 285, 291, 298 impact 93–3, 94, 138, 142,

156, 282, 288see also security Coleman,

William 311 common sense 262, 264, 276communication 76, 87, 100, 102,

114, 150, 265 infrastructure 27, 99, 134,

137, 139, 140, 163, 164,188, 189, 220, 235, 267,271, 287, 291

see also information technology

communism 19, 71, 116, 197,221, 230, 231, 233, 262, 283Chinese 86, 94Russian 85, 94

comparative advantage 25, 116,117, 118, 120, 124 criticisms of 113–15and division of labour 185, 186 and the environment 257 explained 76–7, 111–12and liberalism 13, 15, 75, 111,

112and TNCs 136, 138, 150

compliance 118, 195, 257, 289,290, 300

Concert of Europe 76, 298Confucianism 47, 228

see also Asian valuesCongo

conflict minerals 286under rubber terror 78, 79,

90 constructivism 31, 32, 35, 39,

264, 276consumers 24, 205, 279

and finance 159, 162, 166,173, 175, 176

and labour rights 192, 193,196, 199, 279

and TNCs 137, 139, 145 and trade theory 112, 113,

117, 118consumption 10, 11, 14, 29,

111,116, 118, 173, 175, 176, 177,201, 229, 266, 275, 286, 305–6,307and environment 19, 198,

242, 245, 246, 248, 249,253, 254, 255, 256,

257 in IPE 33, 35, 36mass consumption 97, 143,

188

11, 13, 21environmental 242, 245–6,

248, 260financial 156, 159, 160liberal views 13, 15, 16, 21, 26,

29security 280, 285, 293see also regimes, regionalism

Corn Laws 75 corporations 17, 24, 31

and global governance 14,300–2

origins 52, 61, 63, 70, 88see also transnational

corporationscotton

pre-1900 46, 55, 58, 61, 64, 67,68–9, 70, 71, 186

at the WTO 123, 124, 125Cox, Robert 2, 19, 20, 21, 22,

264, 276credit 63, 71, 73, 85, 86

crisis 163–74, 178–9 micro 165origins 50, 51, 52post-1945 system 155–7 power of 12see also debt, finance

credit rating agencies 178, 180,275

crime 291–2, 302critical theory 17–22, 113, 202,

203see also dependency,

environmentalism, feminism, Marxism

Croce, Benedetto 43 cruise ships 184 culture 64, 65, 94, 230

approaches 39and economic growth 43, 70,

241, 289gender 200, 207, 215, 216, protection of 114 transformation 54, 60, 137,

138, 145 currency controls 110

current account 220see also balance of payments

Cutler, Claire 301, 311

De Goede, Marieke 264 debt crisis

causes 166–7consequences 18, 96, 98, 101,

149, 156, 167–9, 308 debt relief 237–9 decolonization 81, 94–5, 104

pre-1900 48, 56, 61, 62, 74 deflation 73, 74, 159, 167 pandemics 277, 292–4underconsumption 18, 19, 80 democracy 28, 94, 181, 198, 284, pre-1900, 54–55, 57,

60convergence 179–81, 297 308 and security 279, 292–4cooperation 46, 62, 65, 76, 93, criteria 311 see also HIV/AIDS



promotion 289third wave of 310 and TNCs 103and World Bank 233, 236 and WTO 129, 130

dependency 18, 137, 142, 145,147, 186, 225, 230, 268

depression 2, 17, 24, 84, 86, 179,

276, 298, 309Great 11, 15, 83, 85, 87, 90, 93,

115deregulation 149, 151, 232, 268

financial 98, 140, 141, 164,261, 269, 273, 274–5 derivatives

141, 164–5, 166, 273,274, 275 defined 164 mortgage 173

developing countries remittances 189–90 solidarity 240–1and TNCs 145–8 trade 123–27see also debt crisis,

development, G20, Third World

development1400–1800 6419th century 88 definitions 31economic aid 102, 237, 239,

288–9external determinants 225 gendered 203, 204, 205, 207,

208, 209, 210, 212, 217 internal causation 224–5 national capitalism 229–31 neoliberalism 98, 231–4 organization of 234–7 participatory 254, 256post-1945 104success and failures 96 technology 99–100 trade 116, 123–7 underdevelopment 18 uneven 18, 111, 137see also Cold War, debt crisis,

developing countries, sustainable development, trade, TNCs, Washington Consensus, World Bank

Diamond, Jared 44Dickson, Anna 221digital divide 99, 265, 266–7 disease, 58, 62, 105, 171, 212,

251, 252and MDGs 220and new medicines 99



334 | Index

division of labour1400–1800 6319th century 87, 88 criticisms of 186–7 defined 182Fordism 97, 144, 188 gendered 60, 183, 184, 187,

203, 205, 216global 187, 189, 190, 193, 194,

199, 205global stability 196–9 international 88, 153, 183,

185, 186, 188 liberal theory 185–6 migration 189post-1945 103–4 racial 57, 183Taylorism 187–8TNCs 137, 138, 153see also elites, ILO,

slavery Dobson, Andrew 243 dollarization 162–3domestic politics see state–

society relations, world order domestic work 215–16drugs 50, 55, 61, 62, 220, 271–3,

297, 301see also intellectual property

rights, opiumDunning, John 136Dutch East India Company 63,

70

Earth Summit 233, 2502012 259see also Rio conference

East Asia 128, 150, 177, 190, 198,206, 235explanation of success 92,

117, 142, 144, 226–8 financial crisis 7–8, 168, 171,

269, 300, 306, 309Eckersley, Robyn 243ecological imperialism 55, 56, 66 ecologism see environment economic aid 102, 237, 239,

288–9economic nationalism 15, 18, 20,

31, 89, 93, 135, 165, 182, 224,245, 246, 258, 262, 267and the environment 245, 247 and security 280, 282theory 9–13, 21

economicsenvironmental 244, 247, 248,

260feminist 204, 212 institutional 25, 26, 29

and IPE 14, 15, 22, 23, 24–5Keynesian 14, 24, 25, 86, 97,

229, 236, 236

neoclassical 14, 15, 19, 24, 25,

26, 31, 98, 111, 115, 168,

204, 212, 248, 249, 260,

264, 268, 276

see also comparative

advantage, free trade, liberalism, Washington Consensus

Egypt 269pre-1900 45, 46, 54, 70, 79

Eisenhower, Dwight D. 284 elites 33, 46, 56, 57, 67, 299

developing countries 219,226, 229, 230, 256

economic 19, 74, 90, 129, 167,

197, 198, 264, 269, 275European 49, 84, 62 globalizing 26, 189 local 81, 287, 289state 62, 87, 90, 149, 169, 171,

195, 196, 246, 268, 269, 305see also division of labour

emerging markets 153, 174, 221,224

embedded liberalism seeliberalism

Emmanuel, Arghiri 115 empire

1500–1800 54–6219th century 79–82British 72–8see also global governance,

imperialismEnlightenment 70, 89Enloe, Cynthia 204 environment

1400–1800 6419th century 88 definitions 243–4 environmental studies debates

247–9global warming 244, 248, 253,

257–9, 260, 263, 278, 296,306

green parties 252 international agreements 250IPE debates 245–7 mainstreaming 252–3 ozone layer 244, 251, 263 pollution havens 256post-1945 104 sustainable development

253–7 trade 257types of problems 244see also economics

(environmental), environmental degradation, environmentalism, global environmental change

environmental degradation 104,115, 129, 146, 204, 242

environmentalism 9, 17, 21, 243,

244, 247, 248, 250, 251–3,257–9dark green and light green 243 distinguishing features 243 ecologism 243–7technocentric and ecocentric

243, 247–9

epistemic communities 251,262–3, 268, 276

equity 44, 134, 221, 222, 304, 307 advocates 194, 302, 303 environmental 21, 248, 255,

259gender 17, 19, 21, 208, 211

Escobar, Arturo 241Ethiopia 94

pre-1945 48, 55, 79, 80, 83 eurocurrency market 134, 140,

156, 164, 166Europe

15th–18th centuries 49–5419th century 69–79Eastern 91, 94, 140, 156, 174,

184, 206, 221, 254, 291 expansionism 54–62, 78–82 interwar and world wars 82–6 see also individual countries,

European UnionEuropean Central Bank 161, 298European Coal and Steel

Community 93European Economic

Community 93, 128European Monetary System

160–1European Union (EU) 102, 103,

110, 128, 129, 195, 206, 289,299currency and finance issues

161, 178, 197and developing countries 123,


296, 298, 310 origins 93and US 101, 113, 118, 128, 263

exchange rate mechanism (ERM)160–1

exchange rates see international monetary system

export-oriented industrialization (EOI) 142,147, 227, 228, 232

export processing zones (EPZs)98, 142, 143, 146, 183, 189,206, 216, 217see also offshore

factory 67, 88, 143, 144, 187,188, 216 origins 69–70

fair trade 308famine 81, 89, 93, 280, 306Fanon, Frantz 95 fascism 83, 86, 92, 262 feminism 9, 21, 202

see also gender, women feminization

as devalorization 201 of poverty 212–13

Fifth World 224 finance 154–81

1400–1800 50–2, 53, 63



19th century 72–5, 78, 88 deregulation 164, 269, 273–6 innovation 159, 163–7post-1945 80, 82, 86, 88 regulation 174, 181, 274,

309–11TNCs 140–1, 144–5see also credit, financial

crisis, gold standard, international monetary system

financial crisisArgentina 180Asia 7–8, 96, 157, 158, 171,

198, 233, 269, 300, 308, 309European 97, 178–9, 197 global (2008–12) 116, 134,

173–4, 297, 310human cost 104, 279, 298 interwar 85, 86Mexico 170, 232 private sector 166UK 161, 214US 15, 19, 98, 172–3, 176, 181,

270, 273–6see also debt crisis

Financial Stability Forum 169,170

First World 15, 26, 67, 68, 75,

82–4, 85, 95, 155, 196, 281,284, 285, 298

fish 29, 48, 55, 57, 235food 11, 186, 283, 285, 290, 294,

299, 305genetically modified 99, 266 pre-1900 44, 48, 49, 56, 75, 81 security 114, 213, 279, 280, 306 trade 113, 124see also agriculture, famine

Ford, Henry 143, 188Fordism 97, 143–4, 188, 189

see also post-Fordismforeign direct investment (FDI)

26, 97–8, 136, 137–8 defined 134–5 growth 135–45 benefits of 145–8see also transnational

corporationsforeign exchange markets 159,

160, 176Fourth World 208, 209, 224France 72, 74, 92, 184, 289

global governance 236, 300 imperialism 55, 79, 95 international finance 160, 161 interwar period 81, 84, 85pre-1900 46, 52, 53, 72, 75, 77,

82 protectionism 11TNCs 132, 133

Frank, Andre Gunder 18, 21 free trade

19th century 75, 87and economic nationalism 9,

10

gold exchange system 155 British 20, 32, 67 149, 168, 227, 228, 229, 230,gold standard 93, 105, 155 counter 241 232



Index | 335

see also comparative advantage, liberalism, trade

Frieden, Jeffry 33futures 141, 273, 274, 275

defined 164

G5 160G7 160, 169, 170, 187, 300, 308G8 102, 174, 238, 241, 308G20 102, 123, 131, 169, 170–1,

174, 236, 241, 298G24 230G77 230, 231game theory 26, 29

prisoner’s dilemma 29, 30 gender

1400–1800 60, 63–419th century 87, 88and critical approaches 17, 19,

21, 22and development 222, 230,

235, 306 defined 200–1 devalorization 201division of labour 88, 183,

184, 186, 187 employment trends 205–7 glass ceiling 207global public policy 207–12 inequality 184, 201, 202, 303 and ILO 211and IPE 23, 26, 36, 203, 204MDGs 210, 220and poverty 212–13 reproductive work 213–16 and security 277 significance 203structural adjustment 214,

216–17and trade 115, 204World Bank 212see also division of labour,

feminism, womenGeneral Agreement on Tariffs

and Trade (GATT) 127, 231,239Article XIX 118differences with WTO 101,

121, 122dispute settlement 121 negotiating rounds 103, 120,

122normative framework 121 origins 92, 93, 115, 120 special and differential

treatment 122General Agreement on Trade in

Services (GATS) 121, 123, 126 genetically modified crops 99,

266Germany 52, 73, 114, 129, 151,

184Cold War 91, 92, 94 euro 161, 162, 179European monetary system

160

global governance 160, 236,259, 300

industrialization, 67, 72, 77,

88imperialism 55, 79, 81 interwar period and world

wars 82–6protectionism 9, 67, 75, 280TNCs 132, 133, 148

Gertzl, Cherry 221Gill, Stephen 1, 19, 301Gilpin, Robert 1, 10, 21global civil society 301, 302–3Global Compact 32, 196, 304–5 global commodity chains 132,

133global corporations see

transnational corporations global environmental change

242–60see also environment

global financial system 154–81see also finance

global governanceBRICs 296civic associations 302–4 corporations 301–2 defined 295and democracy and

regulation 309–10and development and growth

305–6and equality and justice

306–8and environment 242, 248 expertise 262–3, 300 governance levels 298–301 and international

organizations 101–2, 237 large-scale change 297 – 301 morality 300regimes 12, 15, 16, 22, 32, 34,

246, 262, 298, 299–300,310

states 295–7see also Global Compact

global political economyeclectic framework 22, 37 theoretical consolidation

33–4theoretical expansion 35–6 theoretical integration 34–5 use of the term 24see also international political

economyGlobal South 224

see also Third World, developing countries

global terrorism 287–8 globalization

defined 27impact on IPE research 2–3 project 98, 229views of 9, 10, 12, 14, 18, 19

19th century 67, 72–5 interwar period 82, 84–5

governance1400–1800 65–619th century 89–90 good 220, 270, 291, 306 post-1945 105see also global governance,

statesGrieco, Joseph 33Grameen Bank 165Gramsci, Antonio 19, 20

see also neo-Gramscian approaches

Greecefinancial crisis 156, 175,

178–9, 197Gresham, Thomas 51

Gresham’s law 51gross national product (GNP)

113, 168, 169, 221, 222, 223,226, 255

growthand development 224–8 in trade 116–17of TNCs 135–42women’s contributions 205see also development

Haas, Peter 251, 276Hamilton, Alexander 9, 21, 280,

294Hanseatic League 50, 52, 52 harmony of interest critique 14,

17, 83Haufler, Virginia 311Hayek, Friedrich 14, 21health 94, 96, 136, 146, 168, 175,

176, 188, 190, 191, 199, 266,303, 305and development 32, 220, 22,

223, 234, 235, 237and environment 244, 251,

252, 255 public good 24

and safety 11, 110, 193and security 279, 280, 289,

292–4 standards 151and trade 15, 118, 122, 126,

272women’s 201, 202, 207, 209,

213, 214, 217see also disease, World Health

OrganizationHeavily Indebted Poor

Countries (HIPC) Initiative168, 238–9

Heckscher, Eli 112Heckscher-Ohlin theorem 112 hedge funds 165, 166, 169, 173,

274hegemony 21, 66

after 15, 16, 21, 22

Gramscian view 19, 20, 264,276

US 12, 32, 96, 138, 196 hegemonic stability theory 10,

87historical materialism 20

see also Marxism historicist 37, 43HIV/AIDS

and debt 168and development 210, 220 and gender 215and property rights 126,271–3, 297, 301 and

security 292, 293Hobson, John 80, 81Hobson John M. 43, 66, 71Hong Kong 96, 125, 151, 171,

188, 191, 192, 218, 226, 227,228, 299

homework 121hormone-treated beef 188, 128,

263, 299Human Development Index

(HDI) 222–3Human Development Report 223,

241, 279, 294, 307human rights 27, 32, 78, 87, 115,

196, 280, 285, 289, 290, 297,302, 303, 304 women’s 209–11

human security see securityHymer, Stephen 137Hurrell, Andrew 242

ideas 261–761400–1800 6419th century 88 defined 261post-1945 104 theories about 262–5 see also economic

nationalism, liberalism, intellectual property rights, technology, Washington Consensus

ideology 25, 67, 76, 230, 284, 296 defined 71–2, 262gender 217liberal 70, 87, 89, 149, 185,

236, 268, 307Marxist views 17, 19 racist 89

Ikenberry, G. John 33 imperialism

1400–1800 54–6219th century 38, 75, 77–8,

79–82, 83, 88, 89 ecological imperialism/

eco-imperialism 55–6, 257 theories of 11, 18, 19, 26, 75,

137, 281 import substitution

industrialization (ISI) 137,



336 | Index

India1400–1800 45, 46, 47–8, 49,

50, 54, 55, 56, 59, 63, 65

and British imperialism 60–1,68, 69, 79, 81, 88, 89,

95,186

development 97, 98, 306 and environment 251, 255,

259and global division of labour

184, 189, 192–4, 266 global governance 95, 170,231, 296, 300

technology industry 103, 183,266, 267, 271, 272

textile industry 68, 69, 186TNCs 138, 145, 251trade 110, 117, 123, 126, 127,

195, 199 indigenous

knowledge 273, 276 people 54, 55

individuals 56, 100, 136, 162,166, 172, 174, 182, 214, 221,228, 241, 255, 271, 275, 296 in economics and rational

choice 24, 25, 26, 28–31, 38 and liberal theory 9–10, 13,

14, 16, 18, 21, 71, 185–6,299

and security 278–80, 285, 290,293

IndonesiaAsian financial crisis 7, 8, 171,

198development 96, 98, 192, 227,

231, 233global governance 95, 170,

300pre-1900 46, 55, 60, 64, 79, 95 trade 125, 127

Industrial Revolution described 68–70 explanations of British

origins 70–1international dimensions 71 outside Britain 72

inequality 37, 87critics of 19, 34, 269, 309 and development 221, 241,

245, 266and finance 97, 181gender 36, 184, 187, 201–2,

205, 207, 209, 211, 212–13,217

and global governance 306–8 and labour 189, 191, 193see also poverty

infant industry protection 11,97, 113, 114, 148,

227 inflation1970s 26, 93, 160, 167, 188 debasement and devaluation

51, 73, 160, 162 hyperinflation 162and interest rates 160, 162

interwar 84, 86low 97, 158, 161, 226, 266 political issue 31, 38risk of 164

information revolution 88,99–101, 265–6, 270, 286

institutional investors 172, 177 institutionalism 29–31, 37

liberal 16

insurance 41, 164, 173, 188, 192,274, 290, 301

intellectual property rights 121,125, 126, 271–3, 301see also Trade-Related

Intellectual Property Rights interdependence 23, 36, 139,

150, 293in liberalism 13, 14, 15, 16, 17,

21, 245, 282–3interest rates 74, 141, 162, 163,

164, 168, 172, 174, 175, 176,227, 268and debt crisis 166–7 and domestic monetary

policy 74, 157–8, 161 and financial crisis 170 and inflation 160

International Bank for Reconstruction and Development (IBRD) 155,234, 235see also World Bank

International Commission onPeace and Food 240

International Confederation ofFree Trade Unions 194, 195,196

international economic organizations 101–2, 229, 310 see also particular

organizations international environmental

agreements 250, 260 international labour movement

194labour unions 192, 195, 197

International Labour Organization (ILO) 230, 265 core labour rights 194, 195EPZ study 143

and Global Compact 304–5 global governance 300, 301 peace 196and women 211

international organizations, 284,285, 289and democracy 130and development 219, 226,

229, 231, 234–7, 241and environment 242, 246,

252–3and gender 201, 203, 207–12 and global governance 82, 87,

93, 101–2, 103, 105, 196,298, 299–300, 304, 310

and liberalism 15, 16, 26



and power 20, 94, 264–5see also particular

organizationsInternational Monetary Fund

(IMF) 174, 212Argentina 180Asian financial crisis 7–8, 171 conditionality 231, 232 criticism 167debt relief 168, 238–9 evolving roleglobal financial crisis 174, 179 global governance 105, 121,

169, 170, 171, 230, 236,237, 300, 304, 309

Greece 197influence 101, 102, 167, 186 liberalism 15, 19, 240, 268,

269, 301Mexico 170, 232origins 92, 93, 155, 156 protests against 198see also debt relief, structural

adjustment programmes, Washington Consensus

international monetary system51, 73defined 72, 158fixed to floating 26, 159–60 interwar era 84–5key elements 73post-1945 92, 103, 154, 155 regional currencies 160–3 relationship to capital

mobility 157–9 trade 160see also balance of payments,

dollarization, Bretton Woods, gold standard

international political economy and environmental studies

244–9as a field of study 23–6 theories 9–22, 33–9see also global political

economy, methodologyinternational relations 26International Trade

Organization 92, 93, 115International Trade Union

Confederation 194, 302International Women’s Year 208 internationalism 86, 196, 198,

302democratic 302financial community 86–7

internet 99, 100, 140, 163, 265,266, 267, 291

interwar periodeconomic failure 84–5 lessons 92popular mobilization 85–6 security failure 83US role 86–7

Iran 92, 167, 290Iraq 45, 92, 167, 290

war with US 100, 101, 176,303

Islam 45, 46, 47, 48, 54, 92, 288Italy 77, 133, 184

1400–1600 50, 52, 53, 81 financial crisis 178, 179 global governance 160, 300 imperialism 55, 79, 83 interwar 83, 86see also Venice

Japan 35, 98, 129, 166, 184, 193,214, 223, 255, 271, 282Cold War 91, 92, 93 economic model 31, 74, 96,

144, 188

global governance 101, 104,160, 236, 300

imperialism 79, 81, 83, 95Industrial Revolution 68, 72,

88protectionism 9, 100, 113, 159Second World War 84TNCs 132, 133, 134, 138, 148,

191, 192

Jubilee Debt Campaign 237, 308 just in time production 144, 188

Kabeer, Naila 207Kaldor, Mary 280, 285Kant, Immanuel 15, 21, 283Keohane, Robert 16, 21, 22Keynes, John Maynard 14, 21, 86

Kynesian policies 14, 24–5, 38,

86, 92, 93, 97, 104, 229, 236

Keynesianism 103, 265Kindleberger, Charles 85, 90Kingsbury, Benedict 344Kirchner, Cristina 149Klein, Naomi 151knowledge 188, 228, 249, 272,

276defined 262diffusion 27, 112, 126, 265,

270–1

economy 187, 265–6and environment 250–1, 263 and global governance 302 importance 2and Industrial Revolution 70,

71, 88

in IPE 33, 35, 37in social sciences 23–4, 43 structure 12, 54, 64, 137, 261TNCs, 144, 147, 148see also epistemic

communities, ideas, information revolution, technology

Krasner, Stephen 10, 21Kuznets curve 221

Kyoto Protocol 88, 104, 245, 257,

258, 259, 306

labour1400–1800 63



Index | 337

19th century 88 child 195, 196informal 201, 205, 303 mobility 162organized 180, 188, 196, 197,

303post-1945 103rights 17, 115, 128, 194–6 standards 19, 121, 129, 192,

194, 195, 196, 301, 305,308, 309, 310, 311

see also division of labour, migration, peasants, slavery, trade unions, work

Landes, David 14, 43, 66, 70, 90

Latin Americacompared with East Asia

227–8debt 168, 171development 221, 225, 235,

268 dollarization 163 environment 256global governance 97, 231,

240, 310history 56, 61, 62, 64, 78, 79 industrialization 82 remittances 190trade 110, 119, 128, 186TNCs 140 women 206 workers 197, 198

law 27, 36, 32, 93, 118, 121, 126,

127, 147, 183, 196, 216, 240,264, 271, 272, 287, 290, 291–2,296, 300, 303, 306

Law, David 1, 301League of Nations 83, 86, 92,

101, 289, 298 legitimacy see democracy Lenin, V. I. 19, 21, 75, 81, 137,

281Leopold II of Belgium 78, 90 liberalism 86, 197

19th century 13, 71, 75, 89 absolute gains 13actors 14, 21as a cobweb 17conflict and cooperation 15,

282division of labour dynamics 14embedded 32, 93, 103, 105,

119, 265, 267 environment 247 institutionalism 16neo- 145, 231–4, 236, 267–70 politics 38, 203, 280view of Asian financial crisis

7–8see also interdependence, free

trade, Washington Consensus

leisure 36, 184, 201, 266Limits to Growth 251, 255List, Fredrick 9, 21, 72, 280, 294

London 49, 68, 174, 287 financial centre 73, 74, 164,

299Long Term Capital Management

166

McDonald’s 145McMichael, Philip 98, 168, 198,

199, 229mafia 12, 30, 285, 302malaria 54, 57, 70, 220, 272, 292Malaysia 46, 110, 184, 214, 227,

286, 301capital controls 158, 171TNCs 127, 216, 217

malnutrition 105, 168, 240, 279see also famine

marketsdanger of 11, 63, 78, 81, 85 discipline 8, 70, 71 exploitation 18failure 14, 16, 138, 246, 247 financial 31, 50, 74, 88, 96, 99,

103, 139, 140, 141, 142,156, 158, 164, 171–3, 179,273–6

forces 63, 69, 73, 93, 94, 126,183, 184, 221, 229, 268

free 15, 18, 24, 81, 118, 232 generating wealth 13, 14, 24,

71, 117, 136–7 importance 12, 21influence on states 17, 33, 89,

180–1 labour 70origins 44, 53, 58, 61, 67 political origins 10, 25, 38, 65 size 112, 114see also protectionism

Marshall Plan 92, 93, 155–6, 282Martin, Lisa 33Marx, Karl 17, 18, 20, 21, 25, 34,

71Marxism 15, 17–21, 26, 32, 54,

137, 157, 245–7, 262 actors 18conflict 19, 281, 94 dynamics 18 environment 245–7, 249 gender 202–3 imperialism 81origins 17 trade 114–15see also critical theory,

dependency, Lenin,neo-Gramscian approaches

masculinity 200–1, 204Meadows, Dennis and Donella

251Mediterranean 45, 46, 48, 49, 50,

58, 80mercantilism 9, 21, 38, 113

see also economic nationalism MERCOSUR 102, 103, 128 methodology 16, 27–35, 266

Mexico 98, 110, 142, 189, 199,208, 209, 210, 220, 299, 30315th century 48–9, 55, 56, 65 debt crisis 167–8, 268 financial crisis 170, 171, 270,

306industrialization 188, 192, 227 structural adjustment 232

Middle East 117, 140, 143, 169,177, 190, 206, 215, 235Arab Spring 100 oil 136pre-1900 45–6, 48, 50, 55

Mies, Maria 203migration 44, 65, 189, 190, 213,

252, 291, 307to the Americas 55, 57, 73, 75,

192within China 191

military industrial complex 284Millennium Development Goals

(MDGs) 32, 210, 211, 220,221, 267

Mill, John Stuart 71Ming Dynasty 46–7 modernization theory 225 monetary autonomy 158, 161 money

debasement 51 origins 50–1regional currencies 160–3 reserve currency 174–6 utility 51see also international

monetary systemMongols 45, 46, 53most favoured nation (MFN)

119, 128Multifibre Agreement 120, 124,

125, 192Multilateral Agreement on

Investment 126, 152, 194, 304 multilateralism 93, 101, 119,

122, 128, 285, 310 multinational corporations see

transnational corporationsMyrdal, Gunnar 230

nationalism see economic nationalism

NATO 92, 93, 284, 298naval power 46–7, 60, 65, 71, 77,

186Nazis 85, 86, 94neo-Gramscian approaches 1,

17, 19, 20, 264, 276 neoliberalism see liberalism New International Economic

Order (NIEO) 18, 95, 145,230, 233, 239–40

new wars 285, 286New York 20, 61, 73, 164, 183,

269, 287, 299newly industrializing countries

104, 117, 171, 188, 196, 198,226–8, 240, 269



nineteenth century 67–82 compared with 21st 87

Non-Aligned Movement 95, 230 non-discrimination 118, 119non-tariff barriers (NTBs) 103,

110, 117, 118, 119, 120–1, 122,124

North American Free TradeAgreement (NAFTA) 102,103, 105, 128, 129, 168, 170,194, 197, 198, 264, 298

nongovernmental organizations(NGOs) 21, 199, 208, 215, 272 and development 172, 193,

232–3and environment 242, 245,

246, 240global governance 102, 302–3,

306, 310and WTO 129, 130see also civic associations

North–South conflict 23, 237,239–41

Nye, Joseph 16, 21

Obama, Barack 259, 281, 296Occupy movement 269official development assistance

see economic aidoffshore 98–9, 138, 140, 147,

151, 164, 169, 170, 192, 296,303see also export processing

zonesOhlin, Bertil 112oil 16, 96, 161, 286, 290

crisis 26, 93, 117, 164, 167,224, 226, 229, 231

environment 187, 250, 253,263, 296

finance 98, 164, 165, 166,174–5

TNCs 133, 135, 136, 146, 149 opium 61, 78, 89Organisation for Economic

Co-operation and Development (OECD) 102,113, 117, 118, 126, 152, 156,169, 194, 296, 300

Organisation for EuropeanEconomic Co-operation 156

Organization of PetroleumExporting Countries (OPEC)164, 166

outsourcing 140, 143, 192–3, 217 ownership location investment

model 136

Palan, Ronen 22, 186, 199 pandemic 292–4

see also diseasepatents see intellectual property

rightspatriarchy 38, 186, 203, 217

see also genderPaulson, Henry 274



338 | Index

Pax Britannica 72–8 balance of power 75–8 free trade 75gold standard 72–4 inaccuracy of term 78–9 see also imperialism,

Industrial Revolution peace 26, 72, 89, 100, 101, 105,

208, 208, 211, 278, 285, 287,288, 289, 293, 298, 302 interwar 82–4and labour 196–9and liberalism 15, 26, 155,

280, 282–3 see also security peacekeeping

101, 285peasants 86, 89, 94, 114, 185,

191, 196, 198–9, 213Penrose, Edith 135pensions 172, 179, 190, 197, 275Peoples’ Global Action (PGA)

198–9personal services 206, 214 pharmaceuticals 126, 272, 301

companies 126, 220, 272Philippines 214–15, 227, 273Phillips, Nicola 35, 39Polanyi, Karl 20, 75, 85, 90, 301 political economy 25political science 25Poor Law reform 70Porter, Tony 181, 311Portugal

financial crisis 178, 179pre-1900 46, 54, 55, 56, 57, 58,

79, 80, 81positive-sum game 13, 111 postcolonial 26, 221, 289post-Fordism 143–4, 145, 152 poststructuralism 1, 9, 17, 26, 33,

36, 37, 261, 262, 264poverty 31, 58, 105, 189, 201,

241 anti-poverty movement 308,

309causes 18, 43, 225, 269, 279 and environmental

degradation 104, 251 extreme 190, 219, 234, 240 and famine 81and financial crisis 8, 165,

232, 253, 254gendered 204, 204, 207, 210,

212–13and global governance 305,

307reduction 94, 173, 193, 214,

219, 220, 222, 229, 233,235, 236, 238

and TNCs 146and violence 92, 287, 288,

289, 291see also economic

development, growth, inequality

power

economic nationalism 9–11, 12

and feminism 101, 202, 203,204, 209

state 7, 8, 113, 175, 181, 194,297, 301

structural 12, 147, 180–1, 300see also hegemony

power politics see economic nationalism

Prebisch, Raul 230private authority 301, 311 privatization 149, 168, 232, 266,

268, 307, 310process and production

methods 257product life cycle model 136 production 132–53

1400–1800 6219th century 87 globalization 138–42 post-1945 103see also division of labour,

Industrial Revolution, transnational corporations

prostitution see sex trade protectionism 160, 195, 265, 304

agricultural 120 costs of 13, 113 defined 110economic nationalism 11 explanations for 28–9,

113–15, 130–1, 228 forms of 110new 119, 120, 122 persistence 115–19, 121TNCs 136see also economic

nationalism, Multifibre Agreement

public goods 24, 29public policy 25, 28, 81, 150,

189, 205, 207, 284

quotas 105, 148, 162, 164, 169,173, 175, 483

race 20, 35, 36, 182, 201, 214 racism 58, 81, 89Radice, Hugo 135railways 52, 68, 69, 70, 72, 88,

134, 232, 282Rajoy, Mariano 149rational choice 16, 28–9, 31, 32 rationalist approaches 10, 13, 15,

16, 21, 24, 25, 26, 30, 32, 35,204, 230, 245, 263, 275, 276,280, 282

Reader, Melvin 221, 240Reagan, Ronald 160, 268 realism 9, 11, 21, 26, 83

see also economic nationalism recession 166, 309

1970s 93, 117, 122, 229, 2311980s 1672008 115, 119, 134, 167, 172,

173, 197, 234, 273 government role 24, 32, 158



interwar 84, 85 and trade 116UK 161

reciprocity 87, 118, 119, 228Redclift, Michael 246regional currencies see money regionalism 34, 128regimes

anti-democratic 76 defined 299development assistance 241 environment 247, 254, 259,

260, 262 financial 93global governance 246, 262,

299–300, 310, 311in IPE 12, 15, 16, 32, 34, 105 monetary 93private 301 production 138, 152trade 101, 112, 199, 122, 128,

130, 304 welfare 31

regulation 34 democracy 309–11 deregulation 10, 98, 140, 149,

151, 154, 155, 164, 172,232, 266, 268–70, 273–6,302

environmental 19, 102, 248,250, 252, 256, 257

financial 17, 89, 97, 141, 164,166, 168, 174, 273–6, 297

labour 194–6TNCs 133, 142, 147, 150, 152,

304–5trade 109, 110, 118, 122, 127,

187see also labour standards, global

governance, regimesreligions 46, 89

see also Christianity, Islam remittances 189–90, 215, 233,

234, 286Reno, Janet 215reproductive economy 213–16 research and development see

technologyRhodes, Cecil 79–80Ricardo, David 13, 21, 25, 34, 75,

111–12, 185Rio conference 233, 250, 252 rise of the West 18, 43, 66Robinson, Ronald 81Roosevelt, F. D. R. 86Rostow, W. W. 225 rubber 78, 79, 286Rubin, Robert 274Ruggie, John 2, 32, 39, 93, 105,

119Runyan, A. 200Rupert, Mark 197, 264Russia 19, 32, 53, 96, 97, 165,

166, 177, 216, 259global governance 102, 177,

296

imperialism 79Industrial Revolution 68 pre-1915 53, 72, 74, 75, 77 revolution 81, 85, 94, 196, 281 see also Soviet Union

sanctions 83, 101, 114, 118, 258,288–90, 300

Sauvy, Alfred 224Scholte, Jan Aart 27science 24, 25, 89, 259, 262, 263,

265, 271, 299, 302 see also

knowledge Second World 91, 97

Second World War 92, 93, 95,119,

155 security

1400–1800 6519th century 75–82, 89Cold War 91–3, 283–4 critical 279definitions 277–80 dilemma 278, 284economic statecraft 288–91 food 114, 213, 279, 280 human 36, 204, 279–80, 287,

291, 292, 294, 303 interwar 82national 114, 153, 278–9, 281,

282, 283–4, 285, 291, 292,296

and political economy 280–3 post-Cold War 96, 101, 284–8 see also crime, disease

Seers, Dudley 222Sen, Amartya 241, 306 sex

abuse 217 difference 200, 204

sex trade 104, 207, 213–15, 292,303

silver 50, 55, 56, 58, 61, 64, 66Singapore 145, 165, 166, 293,

299 development 96, 127, 143,

146, 148, 188, 226, 227

Sklair, Leslie 189slavery 2, 44, 62, 183, 215,

262 of Africans 57–8, 80 consequences 59, 62, 64

Smith, Adam 13, 21, 23, 25, 34,71, 111, 185–6, 187, 199,280–1, 294

smoking 260, 263social forces 19, 20, 85, 131, 276

see also elites, labour, peasants social movements 19, 130, 198,

203, 262, 302, 303social science 23–4, 34, 37, 135,

203, 214, 218, 221, 253, 264South Africa 162, 184

development 98, 110, 123,

125, 223

global governance 170, 231,237, 297

patent dispute 297, 301 racial divisions 43, 92, 182



Index | 339

South Korea 98, 170, 188, 193,269and financial crisis 7, 141,

148, 171, 198, 300 industrialization 92, 96, 192,

226sovereignty 11, 36, 126, 229, 278,

289early states 52, 61 global governance 310 selling 187TNCs 135, 145, 152

Soviet Union 81, 91, 164, 267 and Cold War 91–2, 101, 142,

136, 278, 283–4, 288 demise 19, 94, 268, 284, 298,

303Spain

pre-1900 53, 54, 55, 56, 57, 79,

81financial crisis 178, 179TNCs 149

special and differential treatment 126–7

speculation 7, 8, 63, 172, 178,274

Spero, Joan 1spices 46, 47, 49, 50, 55, 62 state

authoritarian 93, 94, 97–8,130, 195, 198, 228, 283,289, 297

communist 91, 94, 156, 30,254

‘competition’ 97, 151, 296 defined 53developmental 38, 97, 227,

228, 267, 268, 270 fascist 83, 86, 92and global governance

295–300liberal 70, 71, 85, 86, 89, 195 national capitalism 229–31 neoliberalism 231–4origins 52–4 transformation 96–99 welfare 83, 96, 198, 296, 297,

303see also embedded liberalism,

Keynesianism, neoliberalism, offshore, security, Washington Consensus

state–firm relations 12, 138,148–51, 152, 301

state–society relations 38, 33, 73,145, 259, 278, 296, 307see also embedded liberalism,

neoliberalism, social forces, world order

statist see economic nationalismSteans, Jill 200Stiglitz, Joseph 309stock market 31, 50, 96, 99, 134,

141, 164, 170, 172, 173, 269,273, 309

Stopford, John 301Strange, Susan 12, 21, 22, 37,

136–7, 168, 181, 261, 301 strategic trade theory 72, 114 structural adjustment

programmes (SAPS) 96, 101,156, 157, 198, 204, 231, 268 content 186, 232gendered impact 213, 214 impact 269Mexico 231–2 resistance to 235see also Washington

Consensusstructure and agency debate 37,

38, 171subsidy 110, 113, 115, 118, 122,

124, 125, 139, 140, 167, 213,258, 298

sugar 43, 50, 55, 57, 58, 61, 64,186, 215

sustainable development 156,221, 235, 242, 243, 246–7, 248,250, 251, 253–6, 259 defined 233

sweatshops 183, 195Sweezy, Paul 26

Taiwan 79, 125, 151, 171, 177,191, 192, 193development 92, 96, 148, 178,

226, 269tariffs 11, 28, 32, 113, 115, 117,

130defined 110 historic 72, 87, 168rates of selected countries 103 reductions within GATT 103,

119–20, 122 tariffication

124Taylor, Fredrick 187–8Taylor, Ian 35Taylorism 188tax 57, 61, 71, 99, 110, 151, 156,

159, 175, 177, 188, 268, 285,286avoidance 147, 292 currency 8cuts 160, 176 havens 98, 187payers 17, 168, 258, 274TNCs 137, 138, 142, 145, 147,

152Tobin, 172

technology 47, 54, 62, 64, 70, 71,

78, 88, 99, 114, 193, 198, 273,276, 282, 311 bubble 99–100, 172 change

89, 139, 265–7 defined 262diffusion 147, 227, 270–1 environment 244, 249, 255,

257gap 27, 99military 11, 46, 57, 65, 94,

284, 291



TNCs 14, 134, 136, 137,139–40, 142, 144, 148, 149,150

see also Industrial Revolution, information revolution, knowledge, naval power

terror 105, 302, 303 nuclear 92 rubber 78terrorism 104, 280, 287–8,

289, 292textiles 112, 117, 143, 183, 186,

188, 191pre-1900 50, 56, 57, 58, 68, 72 protectionism 120, 192

Thailand 151, 171, 227, 233, 293 pre-1900 60financial crisis 7, 158 sex trade 214trade 125, 127

theorycontemporary GPE 33–9 explanation for diversity 21 methods 27–32purpose 8traditional IPE 9–22

Tilly, Charles 53Third World

coalition 230, 232, 240–1 and Cold War 94–6use of term 91, 224see also developing countries,

developmentThomas, Caroline 221, 240, 307Thomas, George 102Touré, Samori 80 trade

1400–1800 6219th-century free trade 75, 87 barriers 9, 29, 87, 120, 130,

139 concentration 116 defined 109developing countries 123–7 environmental degradation

256–7gains from 10, 112, 113, 115,

195growth of 115–18 institutional arrangements

199–22intra-firm 116, 117 intra-industry 112, 117 post-1945 102terms of trade 230see also comparative

advantage, protectionism, regionalism, WTO

Trade-Related IntellectualProperty Rights (TRIPS) 121,122, 123, 126, 271–3see also intellectual property

rightsTrade-Related Investment

Measures 121, 126

trade unions 98, 99, 191, 193,194, 199, 211, 217, 266, 302 origins 69, 71

transnational class 17, 26 transnational corporations

(TNCs)communication 140costs and benefits 137–8,

145–8 defined 134 finance 140–1Fordism 143–4global governance 301–2 globalization of 138–42 growth theories 135–7 labour 151largest 133 mergers 144–5 organizational principles

142–5

political factors 141–2 regulating 148–52 significance 132 structure 136technological change 139see also corporations,

division of labour, state–firm relations

transnational networks 138, 140,144, 198, 245, 287, 291, 304see also civil

society, nongovernmental organizations

transparency 7, 100, 119, 122,129, 171, 238, 270, 281, 303,311

transportation 48, 58, 71, 137,189, 214, 235, 299,

305 triangular trade 57–9, 186Triffin dilemma 155, 159Triffin, Robert 155Trilateral Commission 254Truman, Harry S. 199, 241 tulip mania 63

underdevelopment 18, 224–5,229–30, 280, 291

unemployment 31, 74, 96, 151,

158, 181, 188, 198, 232, 2661970s 117, 1222008–12 173, 179, 197 female 206interwar 26, 84, 86 pre-1900 74

United Kingdom 68, 76–7, 81,

97, 184, 290 gender 214, 215global governance 235, 259,

269

finance 158, 160, 161, 164,173, 174, 214, 281,

309 post-1945 order

32, 93 study of IPE 12, 35TNCs 133, 136, 150 trade 117, 120see also Britain



340 | Index

United Nations 101General Assembly 32, 95, 208,

209, 210, 240, 293Millennium Declaration 212,

220, 305Security Council 101, 286, 293see also Global Compact,

individual agenciesUnited Nations Children’s Fund

101, 301United Nations Conference on

Environment and Development 242, 250, 253,260

United Nations Conference on the Human Environment 250

United Nations Conference onTrade and Development 95,230, 239, 266, 266

United Nations DevelopmentProgramme 222, 223, 279,280, 294

United Nations EnvironmentProgramme 250, 263

United Nations HighCommissioner for Refugees101

United States1980s debt crisis 167 and Argentina 180and Asian financial crisis 8,

157, 171 bonds 177and China 13, 176 163, 177,

191, 193, 258, 259 civil war 72, 77, 78 and Cold War 91–3 consumption 255 and Cuba 79, 194defence spending 9, 11, 100,

281dollar 163, 174–7, 181 drug trade 60, 303Federal Reserve 160, 166, 167,

173, 173, 273financial crisis 166, 172–4,

179, 181, 273–6 financial deregulation 164 gender issues 212, 214, 215,


236, 237, 267, 296, 300 hegemony 12, 16, 20, 26,

32,43, 87, 96, 100, 138, 264

immigration 184, 191, 192 imperialism 57, 60, 70, 79, 95 and IMS 155, 159–60 industrialization 69, 72, 74

interwar period 82, 85, 86–7IPE 12, 16, 33, 35, 39IPR 272–3 isolationism 87 and ITO 119knowledge advantage 271 and Kyoto 245, 259labour 151, 192–2Marshall Plan 156and Mexican financial crisis

170 model 96–7post-1945 economic order

93–4protectionism 9, 67, 74, 87 racial issues 43, 182security 278, 282, 283–4, 285,

287, 288–9, 290, 291 slavery 62, 67, 69, 186, 262 structural power 12TNCs 70, 126, 132, 133, 134,

136, 138, 140, 142, 146,148, 150, 152, 196, 265, 270301, 309

trade 118, 119, 120, 125, 128,129, 168, 263

Treasury 8, 173, 177, 268, 274see also Washington

ConsensusUN Women 211Uruguay Round 120, 121, 123,

124, 125, 126

Venice 49, 50, 53, 60Vernon, Raymond 135, 136

Vietnam 92, 93, 94, 95, 192, 198,

214, 281, 293voluntary export restraints 110,

188, 122

Wall Street 8, 19, 155, 172, 266,

269, 275Walmart 133, 145, 146, 192 war

new 285–6and sex trade 214, 303 and state formation 53see also Cold War,

security, world warsWashington Consensus 94, 156,

157, 167, 232, 233, 267–70,276, 307

Wealth and Poverty of Nations43, 66

Weber, Max 20, 53West

advantages in warfare 56, 60,65, 71, 105, 285

economic system 91–4 rise of 18, 43, 66

Whitworth, Sandra 202, 203WikiLeaks 100Wilkins, Mira 135Williams, Eric 59Williamson, John, 268, 269Wilson, Woodrow 15, 21, 82, 86 wisdom 126, 251, 262Wolfe, Eric 270, 276Wolfensohn, James 198, 293Wolfowitz, Paul 212, 236Wollstonecraft, Mary 17, 71 women

and colonialism 60, 64, 88 and credit 169Decade for 208, 209, 210 employment trends 94, 205–7 in factories 69, 104, 143, 183,

192UN Women 211world conferences 208–9see also division of labour,

feminism, gender, workwork

domestic 215–16 sex 104, 215, 303unpaid 183, 187, 193, 205, 213see also division of labour,

labour, slaveryworking class see classWorld Bank 234–7, 267, 284,

293 and basic needs 230, 234 criticism of 102, 198, 234–5,

236, 237debt relief 168, 238 democracy 236and East Asia 171and environment 252–3, 254 and global governance 102,

169, 170, 171, 230, 231,237, 240, 241, 268, 298,300, 309, 311

inspection panel 236International Bank for

Reconstruction and Development 93, 155, 234

International DevelopmentAssociation 234

liberal policies 15, 167, 236,301

origins 92, 93, 155, 156 primary roles 234social safety net 198structural adjustment lending

101, 231, 232, 235, 240 structure 234and women 165, 212

see also WashingtonConsensus

World Conference on Women208, 209

World Development Report 237World Economic Forum 189,

202, 218World Health Organization

(WHO) 101, 211, 293, 294,301

world order 19, 38, 82, 114, 285,295, 297, 298, 310see also global governance

World Social Forum 189, 276World Trade Organization

(WTO)agreements 121beef dispute 118, 263 compared with GATT 101,

121, 122and democracy 130, 309, 310 developing countries 123–6,

240–1dispute settlement 27, 121,

300, 301Doha Declaration/Round

240–1and environment 102, 256–7 global governance 29, 102,

105, 170, 299, 300, 301, 309 governance 121IPR, 271–2, 297, 301labour rights 194–5, 197–8,

304, 305 legitimacy 129–30liberalism orientation 15, 19,

186origins 101, 103, 121 principles 119protests 19, 102, 199, 304 regionalism 127–9Seattle Ministerial Conference

129, 309see also process and

production methods, Trade-Related Intellectual Property Rights,Trade-Related InvestmentMeasures

world wars 15, 26, 67–8, 82–4 lessons of 92

worldviews 64, 89, 243, 261–2,265, 276

zero-sum game 9, 11, 13, 19, 21,

56, 11

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(329596441) Global Politic Economy O'Brien