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IPE Theories.

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Presentation on theme: "IPE Theories."— Presentation transcript:

1 IPE Theories

2 The Realist Perspective
Time-tested School of Thought Thucydides ( b.c.) the first IR/realist work The History of the Peloponnesian War on wars between the Greek city-states Popularity among world powers (influencing foreign policy decisions) US: a hegemonic power for much of the 20th century USSR: military weakness invites aggresion PRC: China must have nuclear capability to deter aggression from the West & the USSR

3 The Realist Perspective
Time-tested School of Thought Popularity among world powers Weakness of Realism in the subfield of IPE Realist theory was based more on politics & history rather than on economics. Realist theory focuses too much attention on security matters rather than on economic issues. Two strains of realism Machiavelli realism Expanding military power is more important to the Prince than the acquisition of wealth. Military strength can bring wealth.

4 The Realist Perspective
Two strains of realism Machiavelli realism Thucydides/Mercantilist realism Thucydides: the Greek city-state wars are attributable to economic changes, trade growth and rise of new commercial powers Wealth is an important source of military power. “War is a matter not so much of arms as of money, which makes arms of use.” Mercantilists: Wealth expansion should be the goal of the states that intend to enlarge their military capabilities.

5 The Realist Perspective
Basic Tenets of Realism International system Anarchy, lack of a centralized power exercising authority over states Self-help, each state taking care of own survival and well-being Nation-states the principal/unitary/rational actors of international system Obsessed with the challenge of national survival and security Obsessed with the need to enlarge national power to defend sovereignty and independence

6 The Realist Perspective
Basic Tenets of Realism International system Nation-states Societal groups Non-state actors operate within the rubrics of state politics Limited influence over the actions of the states. International Economic Relations & Power Politics A state’s power position in the international system determines its foreign policy Aggressive states may use the international economy to pursue imperialist expansion or extend their power A hegemonic state with dominant power & influence is likely to defend the status quo of the system

7 The Realist Perspective
Basic Tenets of Realism International Economic Relations & Power Politics Other arguments Powerful states can structure economic relations at the international level Globalization is a myth; if globalization does exist, states remain the dominant actors and allow such a process to happen. Major powers can close or open world markets and they can use globalization to improve their power positions vis-à-vis smaller & weaker states A hegemonic state has the ability to create an open and stable economic order that can further the globalization process.

8 The Realist Perspective
Mercantilists & Economic Nationalism When: Main arguments: state power based on size of national wealth Acquisition of wealth is a means of gaining power Post-mercantilist economic nationalism When: Industrialization was a central requirement for countries seeking to gain national security, military power & economic self-sufficiency

9 The Realist Perspective
Post-mercantilist economic nationalism Main arguments: National security and independence requires economic growth that gives priority to industrial development, economic self-sufficiency, state intervention and trade protectionism Manufacturing was more essential for diversifying the US economy and decreasing its vulnerability to external forces. (Alexander Hamilton ( ) and his Report on the Subject of Manufactures) Imposition of trade barriers, promotion of national unity, and development of ‘human capital’ are key to a national rise in wealth and power. (Friedrich List, The National System of Political Economy)

10 The Realist Perspective
The Rise of Realist IPE When: 1970s-1980s What triggered the realist IPE: Decline of Cold War, disarray in the global economy forced many realists to look beyond security issues Realists could not remain silent to the liberal and Marxist economic analysis of IPE. Major changes in the post-war economic system such as the rise of the OPEC, relative decline of the US economic hegemony, increasing friction & competition between US & other DCs; and the onset of the debt crisis

11 The Realist Perspective
Hegemonic Stability Theory When: 1970s-1980s Central arguments: A global hegemon contributes to economic openness and world stability International economic system (IES) is most likely to be open and stable when there is a single dominant or hegemonic state A hegemonic power is one that: Has a sufficiently large share of resources that it is able to provide leadership Is willing to pursue policies necessary to create and maintain a liberal economic order Whose decline in power is likely to undercut economic openness

12 The Realist Perspective
Hegemonic Stability Theory When: 1970s-1980s Central arguments: A global hegemonic power helps maintain an open and stable economic system by: Creating and maintaining liberal international regimes Sets of implicit or explicit principles, norms, rules and decision-making procedures Providing public goods and rewards and the use of coercion to encourage compliance and punish rule-breaking behaviors.

13 The Realist Perspective
Hegemonic Stability Theory (HST) Critics of the HST Can generalizations be drawn about hegemonic behavior based on the experiences of two global hegemons during limited historical perioods? What constitute a hegemonic power and how to measure its power? On what ground can HST claim that a hegemon contributes to economic openness and global stability?

14 The Realist Perspective
Defining a hegemonic power Robert Gilpin’s realist definition a hegemonic power is one that is capable of controlling or dominating the lesser states in the international system. Immanuel Wallerstein's definition a hegemon is one that possesses such a predominant power that enables it to impose its rules and wishes (or by using veto power) in the economic, political, military, diplomatic and even cultural arenas. Gramscian definition Hegemony is viewed as a complex web of ideas that social groups use to assert their legitimacy and authority hegemony of ideas such as capitalism

15 The Realist Perspective
Three Types of Hegemon A benevolent hegemon The hegemon is benovolent in both goals and means. It is more concerned about promoting generalized benefits than its self-interest. It uses rewards rather than threats to ensure compliance. A coercive hegemon is exploitative exerts leadership out of self-interest is more inclined to use coercion to extract compliance A third hegemon Pursues general as well as self interest More inclined than the benevolent hegemon to use coercion More inclined than the coercive hegemon to use rewards.

16 The Liberal Perspective
Main Arguments Individual Freedom Individuals have natural rights that cannot be infringed upon by groups or state Individual freedom is vital for the pursuit of political and economic interest Individual endeavor benefits the society as a whole State or social groups should stay out of individual decision-making Int’l Economic Relations Int’l groups such as IMF and World Bank are politically neutral If states conform to their rules, they will all grow

17 The Liberal Perspective
Main Arguments Int’l Economic Relations The int’l economic system benefits all as long as states are willing to pursue rational liberal economic policies. The roadblock to development is low efficiency and lack of freedom, not distributional disparity between the North and South. Today’s LDCs have advantages the DCs did not have when the latter were taking off LDCs have access to capital and technology from DCs Globalization contributes to growth of LDCs if they follow open and liberal policies.

18 The Liberal Perspective
Main Arguments Politics & Economy Politics and economics are two separate & autonomous realms Government should not interfere with domestic & int’l economic transaction Government’s role should be limited to Creating a favorable business environment Providing public goods National defense

19 The Liberal Perspective
Adam Smith & Orthodox Liberalism Adam Smith ( ) Advocated laissez-faire economics Opposed mercantilist policies Advocated freely operating markets based on a division of labor Free market with division of labor maximizes efficiency & prosperity Called for eliminating barriers of mercantilist states so that goods can be exchanged across national borders Free trade is important because nations are interdependent on one another.

20 The Liberal Perspective
John Maynard Keynes & Keynesian Liberalism John Maynard Keynes ( ) Advocated state intervention at times of economic downturn spiral Opposed extreme levels of economic nationalism Argued that self-interest and public interest do not always converge as Adam Smith suggested Argued that market did not tend inherently toward a socially beneficial equilibrium. Argued for government intervention to create demand at time of sluggish economy Placed less emphasis on specialization and int’l trade Argued that import restrictions may be necessary to bolster domestic employment

21 The Liberal Perspective
Interdependence Theory Main Arguments: Advances in transportation, communications & technology are negating distinction between internal & external policies States are losing some autonomy in managing their own affairs because of growing economic interdependence Cooperation among states is the best response to the new situation Richard Cooper: The Economics of Interdependence (1968) Interdependence can be asymmetrical A less dependent state has more power in the relationship Interdependence can be complex Robert Keohane and Joseph Nye

22 The Liberal Perspective
Interdependence Theory Main Assumptions States are not unitary actors States are not the only important actors in IR Military means are not always useful for promoting national interests IR includes both inter-state and domestic issues, intermestic The Prisoners’ Dilemma & Int’l Cooperation The Prisoners’ Dilemma Each is motivated to defect rather than cooperate Each strives for sub-optiomal outcome rather than best collective outcome Cheating by states is prevalent and hinders cooperation.

23 The Liberal Perspective
The Prisoners’ Dilemma & Int’l Cooperation The Prisoners’ Dilemma Cheating by states is prevalent and hinders cooperation. A hegemon or international orgazations can solve the defection problem. How? A hegemon prevents cheating by rewards or coercions Int’l organizations prevent cheating by enforcing rules, punishing cheaters, and making public state policies A state in the global economy is less likely to cheat because of the inevitability of retaliation

24 The Historical Structuralist Perspective
Basic Tenets of the Perspective The concept of class and class dichotomy The oppressing class v the oppressed class State=agent of the dominant class State reflecting and serving the interests of the dominant class State to be eliminated as a tool of class exploitation only through proletarian revolution by eliminating private ownership & class distinctions Inter-state economic ties Zero-sum game Conflictual Between the advanced contries & LDCs Among the advanced countries

25 The Historical Structuralist Perspective
Dependency Theory A theory to explain development of Latin American countries Main Arguments On the source of LDC underdevelopment External factors hinder development in the South On domestic elites (compradores) Served as intermediatories between capitalist int’l order and the subjected local people Allied with the elites in the capitalist states to maintain the pattern of LDC dependency On potential of LDC development Little potential because development of the capitalist economies in the core required the underdevelopment of the periphery

26 The Historical Structuralist Perspective
Dependency Theory A theory to explain development of Latin American countries Main Arguments On potential of LDC development LDCs cannot develop as long as they have links with the core. Dependent Development Theory A theory to explain away development in East Asia Some LDCs can develop when a particularly favorable alliance forms between foreign capital, domestic capital, and the LDC. The alliance allows some development in LDCs. Yet, LDCs and NICs are fundamentally dependent Their development is conditioned by the needs in the core. Workers in NICs are low paid; NIC produce low end goods

27 The Historical Structuralist Perspective
World System Theory Main Arguments Modern world system (the main unit of analysis) It is a world economic system Components of the world system Core states Periphery states Semi-periphery states Mobility of states is possible Countries have moved from periphery up to core USA, Japan Countries have moved from periphery to semi-periphery Mainland China, Taiwan, Singapore, South Korea… Yet, upward mobility is rare The unique role of semi-periphery Unity of the periphery is undermined

28 The Historical Structuralist Perspective
World System Theory Main Arguments The unique role of semi-periphery Unity of the periphery is undermined Semi-peripheral states tend to think they are better off than the peripheral states rather than worse off than the core states Semi-peripheral states are both exploiters and exploited Core-dominated system is thus stabilized The core states dominate the system They set market rules for transnational transactions They use force to enforce the rules when peripheral states challenge the rules They impose unequal exchange relations on weaker states They appropriate surplus of the whole world economy


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