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Analyzing the Global Political Economy

Analyzing the Global Political Economy

Andrew Walter
Gautam Sen
Foreword by Benjamin J. Cohen
Copyright Date: 2009
Edition: STU - Student edition
Pages: 296
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  • Book Info
    Analyzing the Global Political Economy
    Book Description:

    Ideally suited to upper-undergraduate and graduate students,Analyzing the Global Political Economycritically assesses the convergence between IPE, comparative political economy, and economics. Andrew Walter and Gautam Sen show that a careful engagement with economics is essential for understanding both contemporary IPE and for analyzing the global political economy. The authors also argue that the deployment of more advanced economic theories should not detract from the continuing importance for IPE of key concepts from political science and international relations. IPE students with little or no background in economics will therefore find this book useful, and economics students interested in political economy will be alerted to the comparative strengths of political science and other social science disciplines.

    A concise look at the foundations of analysis in the political economy of global trade, money, finance, and investmentSuitable for upper-undergraduate and graduate students with some or no economic backgroundTechniques and findings from a range of academic disciplines, including international relations, political science, economics, sociology, and historyFurther reading and useful weblinks including a range of relevant data sources, listed in each chapter

    eISBN: 978-1-4008-3780-9
    Subjects: Political Science, Economics

Table of Contents

  1. Front Matter
    (pp. i-iv)
  2. Table of Contents
    (pp. v-vi)
  3. List of Figures and Tables
    (pp. vii-viii)
  4. Foreword
    (pp. ix-x)
    Benjamin J. Cohen

    What is the nature and scope of the scholarly discipline of international political economy? Most people would agree that IPE, at its most fundamental, is about the complex interrelationship of economics and politics in international affairs. In the words of Robert Gilpin, one of the field’s pioneers, IPE is about “the reciprocal and dynamic interaction in international relations of the pursuit of wealth and the pursuit of power.” By pursuit of wealth, Gilpin had in mind the realm of economics: the role of markets and material incentives, which are among the central concerns of mainstream economists. By pursuit of power,...

  5. Preface
    (pp. xi-xiv)
    Andrew Walter and Gautam Sen
  6. Abbreviations
    (pp. xv-xviii)
  7. 1 International Political Economy
    (pp. 1-26)

    What is international political economy (IPE)? A simple answer is that IPE is concerned with the way in which political and economic factors interact at the global level. More specifically, political economists usually undertake two related kinds of investigations. The first concerns how politics constrains economic choices, whether policy choices by governments or choices by actors or social groups. The second concerns how economic forces motivate and constrain political choices, such as individuals’ voting behavior, unions’ or firms’ political lobbying, or governments’ internal or external policies.

    An example of the first kind of investigation is provided by the European Union’s...

  8. 2 The Emergence of a Multilateral Trading System
    (pp. 27-59)

    Chapters 2 and 3 discuss the political economy of international trade. We consider how the literature in political economy has answered two broad questions. The first is what explains the shift, over the past century, from an informal, noninstitutionalized trading system to a “multilateral” trading system characterized by rules and formal institutions (chap. 2). The second question is why most countries practice protectionism, despite economists’ advocacy of free trade as optimal policy for all countries (chap. 3).

    In this chapter, we begin our consideration of the first question with a brief overview of the evolution of the trading system since...

  9. 3 The Political Economy of Trade Policy
    (pp. 60-84)

    This chapter focuses on the political factors that lead governments to put restrictions on trade, as they do to varying degrees across countries and over time. Here we can safely leave aside the theoretical possibility that protectionism may raise aggregate economic welfare in some circumstances (discussed in the previous chapter). Since governments often enact protectionist policies even when doing so seems to reduce aggregate welfare, political economists face a puzzle. In the previous chapter we argued that debates among economists about the possible justifications for protection have favored governments seeking reasons to adopt such policies. Since it is unlikely that...

  10. 4 The Evolution of the International Monetary System
    (pp. 85-132)

    Chapters 4 and 5 discuss the political economy of international money and finance. In chapter 2 we discussed the reasons for the evolution of the international trade system toward institutionalized multilateralism. Similarly, in this chapter we consider how the literature in political economy has tried to explain the evolution of the international monetary system. As for international trade, the international monetary system also became characterized by institutionalized multilateralism by the mid-twentieth century, for a similar combination of material and ideational reasons. In contrast to trade, however, multilateralism in international monetary arrangements peaked in the 1960s and has been in retreat...

  11. 5 The Consequences of International Financial Integration
    (pp. 133-170)

    In this chapter, we first elaborate on the argument made in the previous chapter in the context of the demise of the Bretton Woods system, that international financial integration has substantially raised the costs of maintaining pegged exchange rates. This has resulted in a noticeable trend toward greater exchange rate flexibility since the 1970s. Second, we discuss how the dramatic growth of private international capital markets has not only overshadowed, but also altered, the role of public international finance because of the growing incidence of severe financial crises. Third, we consider the extent to which financial integration constrains domestic economic...

  12. 6 The Political Economy of Foreign Direct Investment
    (pp. 171-200)

    Although globalization skeptics often argue that trade and financial interdependence between countries is nothing new,¹ few doubt that multinational corporations (MNCs) have unprecedented importance in the contemporary global economy.² Of course, MNCs themselves are not new and were known in the ancient world. Certainly, by the early modern period, private firms heavily involved in international trade had established trading outposts and sourcing operations in other countries. Perhaps the most famous, the East India Company, had obtained monopoly privileges from the English state at the beginning of the seventeenth century and came to wield considerable political and military power in India...

  13. 7 The Regulation and Policy Consequences of Foreign Direct Investment
    (pp. 201-227)

    In this chapter, we consider two related questions. The first concerns the relatively recent emergence of international rules on FDI. Although no comprehensive multilateral investment regime exists, there is an emerging web of bilateral and regional investment regimes that create an increasingly complex picture. Given that international regimes on trade and finance were created in the mid-twentieth century, the different pattern in the area of FDI rules requires further investigation. We argue that the general level of political support for a comprehensive international investment regime remains considerably lower than for international trade, even within the advanced countries. Second, we consider...

  14. 8 Conclusion: Looking Forward
    (pp. 228-240)

    Having assessed how political scientists and economists have analyzed the political economy of trade, money and finance, and foreign direct investment in the preceding chapters, in this concluding chapter we briefly address some broader questions. First, given the turn toward economics witnessed in international and comparative political economy in recent years, how much progress has been achieved in our field? Second, although we examined trade, money, and FDI separately in the preceding chapters, how should we analyze their interaction in the global political economy? Third and finally, what light does our survey throw on the question of how much the...

  15. Bibliography
    (pp. 241-264)
  16. Index
    (pp. 265-275)