Table of contents:
● Part I Perspectives on International Political Economy
○ Chapter 1 What Is International Political Economy? Blz. 1
○ Chapter 2 Laissez-Faire: The Economic Liberal Perspective Blz. 4
○ Chapter 3 Wealth and Power: The Mercantilist Perspective Blz. 8
○ Chapter 4 Economic Determinism and Exploitation: The Structuralist
Perspective Blz. 11
○ Chapter 5 Constructivism
● Part II Structures of International Political Economy
○ Chapter 6 The Global Production Structure Blz. 20
○ Chapter 7 The International Trade Structure Blz. 24
○ Chapter 8 The International Finance and Monetary Structure Blz. 31
○ Chapter 9 The Global Security Structure
○ Chapter 10 The International Knowledge Structure: Controlling Flows of
Information and Technology Blz. 39
● Part III States and Markets in the Global Economy
○ Chapter 11 The Development Challenge Blz. 44
○ Chapter 12 The Fragmentation of the European Union: The Crossroads
Redux Blz. 53
○ Chapter 13 Moving into Position: The Rising Powers Blz. 60
○ Chapter 14 The Middle East and North Africa: Things Fall Apart Blz. 67
● Part IV Transnational Problems and Dilemmas
○ Chapter 15 The Illicit Global Economy: The Dark Side of Globalization
Blz. 72
○ Chapter 16 Energy and the Environment: Navigating Climate Change and
Global Disaster Blz. 78
○ Chapter 17 Global Health: Refugees and Caring for the Forgotten Blz. 82
Balaam, D. N. & Dillman, B. (2018) Introduction to International Political Economy, 7th edition
Routledge.
,Chapter 1:
What is International Political Economy:
In the last years global problems and certain conditions have caused many people to
become anxious, frustrated, and even angry. Examples of these conditions are the
unexpected election of Donald Trump as president of the United States. The global refugee
crisis and the withdrawal of the United States from the Paris accord are other examples.
The post-war order can be divided into three distinct phases; 1944-1973, 1974-1991 and
1992-2017. The phases don’t have an abrupt beginning or end. Some of the characteristics
from one phase continue to exist in the other phase.
Global Political Economy instead of International Political Economy; label the study of
problems such as climate change, hunger that have spread over the entire world. Most of
the time the terms are used interchangeably.
IPE includes a political dimension that accounts for the use of power by different types of
actors. IPE also has an economic dimension that deals with how scarce different resources
are in markets among different actors. The market can be thought of as a driving force that
shapes human behavior. The political and economic dimension form ‘International Political
Economy’. Political scientist Charles Lindblom: ‘Economy is nothing more than a system for
coordinating social behavior.
Four dominant perspectives in IPE briefly explained; economic liberalism,
mercantilism, structuralism and constructivism:
Economic liberalism:
● Closely associated with the study of markets
● Orthodox economic liberals; free markets, free trade; economic growth is best
achieved when leaving the market and economy alone.
● Heterodox economic liberals; state regulation in the market, trade protection to
sustain markets. Markets work best when they are connected to society; the state
intervenes in the market to find solutions for problems they can’t solve alone.
● Important thinkers: Adam Smith, David Ricardo, Keynes, Hayek, Friedman.
● Adam Smith: Laissez-faire (met rust laten): The state should leave the economy
alone
Mercantilism (economic nationalism)
● Closely associated with the political philosophy of realism
● State efforts to accumulate power and wealth to protect society in the state from
harm or influences from other states.
● States use two kinds of power to defend themselves: ‘Hard power’; military and
economic power and ‘soft power’; selective tools that reflect and project a country’s
cultural values, beliefs and ideals that can be used as power. In many situations soft
power is more effective than hard power
Structuralism; rooted in Marxist analysis:
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, ● Structuralism examines class divisions, exploitation, and imperialism (not unique in
Western capitalist societies)
● ‘How the dominant economic structure of any society affects different social classes’
Constructivism:
● Norms, ideas and discourse play important roles in shaping outcomes in the Global
Political Economy.
● Today, many societies become more polarized and authoritarian, as a reflection of
shifting cultural norms and values, raising the prospect of more violence; importance
of norms, ideas and discourse.
The Four Levels of Analysis:
IPE theorists often use different levels of analysis in their research. The levels aren’t
mutually exclusive; there are most of the time explanations at all levels. Most of the time one
certain level usually provides better answers than others.
● Global level: Broadest and most comprehensive level of analysis. We look at global
economic constraints and opportunities from changes in technology, global markets
and the natural environment. The global level is usually influenced by more actors
than just one.
● Interstate level: In the interstate level, relationships between states affect global
outcomes.
● State-societal level: Analyzes how bureaucratic decision making and the type of
government shape outcomes.
● Individual level: What individuals do to influence certain events. The goal is to
understand the psychology, goals and ideology of state leaders, to study why they
reacted in a certain way.
The Five IPE Structures:
Susan Strange stated that these structures are complex arrangements that function as the
underlying foundations of the international political economy.
Each of the IPE structures is often filled with tensions, because different actors are
constantly trying to preserve or change the rules of the structure to better reflect their own
interests and values.
Five structures:
● The Production Structure: The issue of who produces what and on what terms lies
at the heart of the international political economy. Producing goods can shift the
global distribution of wealth and power in the long term.
● The Trade Structure: International trade agreements and national regulations shape
the flows of goods and services across borders. (Free trade is one foundation of
today's international political economy).
● The Finance and Monetary Structure: This structure determines who has access to
money and on what terms and thus how capital is distributed between nations.
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, ● The Security Structure: Feeling safe from threats of other states and nonstate
actors like terrorist groups is one of the most siginificant concerns of nation-states
and the people within them.
● The Knowledge Structure: Knowledge and technology are sources of wealth and
power for those who use them effectively. (Soft power?)
The Rise of Populism and Nationalism:
There is a movement going the last few years with the re-emergence of nationalism and a
loss of faith in globalization. Past decade there has been growing mass support for ‘populist
nationalist’ parties. The election of Donald Trump as president of the United States is an
example of the growing support for nationalist parties.
Globalization benefited rich elites, instead of the working class and poor people. Income
inequality has risen in the past decades in many developed countries. For many middle-and
lower class workers, wages have barely grown since at least the early 2000’s.
For more than two decades, low skilled and blue-collar workers have suffered as
manufacturing jobs have moved to developing countries and automation has expanded.
Two important effects of these developments:
● Leaders and masses focused on issues such as jobs, border control and
preservation of socio-cultural values and identities.
● Xenophobia, racism and fear of other religions increased.
New populism could potentially pose a threat to democracy and western ideals; most of the
populist movements today are on the political right. The biggest populist parties in Europe
have gained strength since 2010, causing alarm for supporters of European Integration.
Opponents of populist parties are anxious because populists seem to be pushing aside
liberal democratic values and beliefs by drawing on people’s fears, disillusionment with
democratic systems and exposure to fake news.
Another feature of populist-nationalism has been ‘strongman politics’, understood at the first
level of analysis. Populist leaders have always played a big role. Often populist leaders
tolerate racism and scapegoat immigrants and foreigners. Populist-leaders also appeal to
mainstream voters by criticizing globalization and elites in world politics; calling for
protectionism, job growth and stressing to recover national-sovereignty, instead of power in
Brussel.
The Communications Revolution:
Changes in how information is produced and communicated have contributed to the rise of
populist-nationalism; social media makes it easier and faster to disperse information rapidly.
Social media also makes it easier to distort facts and generate stories that are untrue (fake
news).
Fake news is often successful, because many readers are not savvy enough to question the
authenticity of the source. Just like fake news, cyber hacking is another method to change
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