Systemic Theories of IPE. Lecture 4 – Thursday, 17 September 2009 J A Morrison. Steve Krasner. Robert Keohane. Admin. Did you get my email?. Agenda: Systemic Theories of IPE. The Big IPE Puzzle: Globalization Systemic Theories Interstate Competition Hegemonic Stability Theory
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Lecture 4 – Thursday, 17 September 2009J A Morrison
In IPE, we might assess the level of globalization by measuring the level of trade, cross-border capital flows, and international migration.
Economic models don’t tell us what happens on the ground.For a variety of reasons—some “good” and some “bad”—policy makers don’t heed the prescriptions of economists.
“Neoclassical theory recognizes that trade regulations can . . . be used to correct domestic distortions and to promote infant industries, but these are exceptions or temporary departures from policy conclusions that lead logically to the support of free trade…Historical experience suggests that policy makers are dense, or that the assumptions of the conventional argument are wrong. Free trade has hardly been the norm. Stupidity is not a very interesting analytic category.” (Krasner, 20-21)
“[I]n the absence of cooperation, governments will interfere in markets unilaterally in pursuit of what they regard as their own interests, whatever liberal economists may say.” (Keohane, 50)
Here’s the point.We can’t understand the development of the global economy without understanding foreign economic policy.That means understanding politics.
Trying to understand the retreat of globalization between 1914 and 1945 is one of the biggest questions in IPE.So-called “structural” and “systemic” theories were among the first attempts to resolve this puzzle.
Focus is on Waltz’ 3rd Image: the level of the international system. This structure is independent of the ideas, institutions, and interests that exist within states.(We’ll look within states next week.)
Hegemonic Stability Theory (HST) is a Systemic theory of international politics (IP):“the openness and stability of the world economy depends on the presence of a hegemonic power that, acting in its own enlightened self-interest, plays the role of organizer and supervisor of the world economy.” (G&I 111)Distribution of Power (IV) Patterns of Interstate Relations (DV)
-- (There are lots more theorists in this tradition!)
A state might use asymmetric costs of closure as leverage against other states(e.g. After opening Canada’s markets, the US could threaten to close the borders if Canada does not support the US in Iraq.)
But states exist in anarchy, in a “self-help” system.As Hobbes asked, how do we get cooperation without a state authority to enforce agreements?
HST provides a potential answer: hegemons serve as a proxy for state authority to reduce the “anarchy.”Hegemons can use both sticks and carrots to open foreign markets.
“The most important conclusion of this theoretical analysis is that a hegemonic distribution of potential economic power is likely to result in an open trading structure.” 20
“The degree of openness can be described both by the flow of goods and by the policies that are followed by states with respect to trade barriers and international payments.” 24
Narrower version of “potential power,” “such factors as gross national product, per capita income, geographical position, and size of armed forces.” 28
Led by Robert Keohane, a group of scholars (sometimes called neoliberal institutionalists) questioned whether it was possible to have openness after hegemony.(Note the title of Keohane’s book!)
This followed largely from the recognition that openness has persisted (and expanded!) even as American relative economic power has declined.
International regimes: "sets of implicit or explicit principles, norms, rules and decision-making procedures around which actors\' expectations converge in a given area of international relations. Principles are beliefs of fact, causation, and rectitude. Norms are standards of behavior defined in terms of rights and obligations. Rules are specific prescriptions or proscriptions for action. Decision-making procedures are prevailing practices for making and implementing collective choice” 57
So, IPE scholars are particularly interested in the variation in the level of economic integration observed over the last several centuries.That is one of the biggest DVs of interest.
Systemic theories think that the structure of the international system is the key IV that shapes states’ foreign economic policies—which determine whether globalization occurs.
Hegemonic stability theorists (Krasner & Kindleberger) think that the concentration of power in the hands of one state is enough to overcome states’ hesitancies to open markets.
Scholars like Robert Keohane (“neoliberal institutionalists”) argue that it is possible to achieve cooperation without hegemony by using international regimes.
But does the structure of the international system really explain all of states’ foreign economic policies? What about domestic politics: the institutions, interests, and ideas within states?
I can’t wait!