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collective action problem 64 hard power 66 hegemonic stability theory 62 hegemony 63 international regimes 65 mercantilism 59 New International Economic Order 69 public goods 64 rational choice 54 relative gains 57 soft power 66 variable-sum game 57 zero-sum game 57

FURTHER READING

A study that applies rational choice to IPE is Bruno S. Frey, International Political

Economics (New York: Basil Blackwell, 1984). For rational choice analysis from a lib-

eral perspective, see Robert O. Keohane, After Hegemony: Cooperation and Discord in

the World Political Economy (Princeton, NJ: Princeton University Press, 1984); from a

realist perspective, see Robert Gilpin, War and Change in World Politics (New York: Cambridge University Press, 1981); from a critical perspective, see John Roemer, “‘Rational Choice’ Marxism: Some Issues of Method and Substance,” in John Roemer, ed., Analytical Marxism (New York: Cambridge University Press, 1986), pp. 81–113. An insightful analysis of the realist approach to IPE is Jonathan Kirshner, “Realist

Blyth, ed., Routledge Handbook of International Political Economy (New York: Routledge, 2009), pp. 36–47.

Declinist literature on hegemony includes After Hegemony: Cooperation and Discord

in the World Political Economy (Princeton, NJ: Princeton University Press, 1984);

Paul Kennedy, The Rise and Fall of the Great Powers: Economic Change and

Military Conflict from 1500 to 2000 (New York: Random House, 1987);

David Calleo, Beyond American Hegemony: The Future of the Western Alliance (New York: Basic Books, 1987). Renewal literature on U.S. hegemony includes Susan Strange, “The Future of the American Empire,” Journal of International

Affairs 42 (Fall 1988), pp.1–17; Samuel P. Huntington, “The Lonely Superpower,” Foreign Affairs 78, no. 2 (March/April 1999), pp. 35–49. On neoconservativism

and U.S. renewal, see Robert Kagan and William Kristol, eds., Present Dangers:

Crisis and Opportunity in American Foreign and Defense Policy (San Francisco,

CA: Encounter Books, 2000). On soft versus hard power, see Joseph S. Nye, Jr., The

Paradox of American Power: Why the World’s Only Superpower Can’t Go It Alone

(New York: Oxford University Press, 2002).

On realist views of the role of the state in IPE, see Jonathan Perraton and Ben Clift, eds., Where Are National Capitalisms Now? (New York: Palgrave Macmillan, 2004). Realist studies on the developmental state include Linda Weiss, “Guiding Globalization in East Asia: New Roles for Old Developmental States,” in Linda Weiss, ed., States in the Global Economy: Bringing Domestic Institutions Back In (New York: Cambridge University Press, 2003), pp. 245–270.

On realist views of North–South relations, see Stephen D. Krasner, Structural Conflict:

The Third World Against Global Liberalism (Berkeley, CA: University of California

Press, 1985); and David A. Lake, “Power and the Third World: Toward a Realist Political Economy of North-South Relations,” International Studies Quarterly 31, no. 2 (June 1987), pp. 217–234.

NOTES

1. Laurie M. Johnson Bagby, “The Use and Abuse of Thucydides in International Relations,” International Organization 48, no. 1 (Winter 1994), pp. 131–153; Jonathan Monten, “Thucydides and Modern Realism,” International Studies

Quarterly 50, no. 1 (March 2006), pp. 3–25.

2. Ole R. Holsti, “Theories of International Relations and Foreign Policy: Realism and Its Challengers,” in Charles W. Kegley, Jr., ed., Controversies in International

Relations Theory: Realism and the Neoliberal Challenge (New York: St. Martin’s

Press, 1995), p. 36.

3. Quoted in Albert O. Hirschman, National Power and the Structure of Foreign

Trade, exp. ed. (Berkeley, CA: University of California Press, 1980), p. xv.

4. Niccolò Machiavelli, The Prince and the Discourses (New York: Modern Library, 1940), pp. 308–310.

5. Thucydides, The History of the Peloponnesian War, trans. Richard Crawley (London: Dent, Everyman’s Library, 1910), p. 41; Robert G. Gilpin, “The Richness of the Tradition of Political Realism,” International Organization 38, no. 2 (Spring 1984), p. 293.

6. Thomas J. Biersteker, “Evolving Perspectives on International Political Economy: Twentieth-Century Contexts and Discontinuities,” International Political Science

Notes 73 7. Herbert A. Simon, “A Behavioral Model of Rational Choice,” in Herbert A.

Simon, ed., Models of Man: Social and Rational (New York: John Wiley & Sons, 1957), pp. 20–21; Robert Gilpin, War and Change in World Politics (New York: Cambridge University Press, 1981), pp. 20–21.

8. Robert Gilpin, U.S. Power and the Multinational Corporation: The Political

Economy of Foreign Direct Investment (New York: Basic Books, 1975), p. 34;

Kenneth N. Waltz, Theory of International Politics (Reading, MA: Addison Wesley, 1979), p. 126.

9. Tony Evans and Peter Wilson, “Regime Theory and the English School of Inter- national Relations: A Comparison,” Millennium 21, no. 3 (Winter 1992), p. 330. 10. Robert W. Cox, Production, Power, and World Order: Social Forces in the Making

of History (New York: Columbia University Press, 1987), p. 6.

11. Hannes Lacher, “Putting the State in Its Place: The Critique of State-Centrism and Its Limits,” Review of International Studies 29 (2003), p. 526; Janice E. Thomson, “State Sovereignty in International Relations: Bridging the Gap Between Theory and Empirical Research,” International Studies Quarterly 39, no. 2 (June 1995), pp. 213–233.

12. Stephen D. Krasner, Sovereignty: Organized Hypocrisy (Princeton, NJ: Princeton University Press, 1999), p. 223.

13. Jonathan Perraton and Ben Clift, Where Are National Capitalisms Now? (New York: Palgrave Macmillan, 2004).

14. Linda Weiss, “The State-Augmenting Effects of Globalisation,” New Political

Economy 10, no. 3 (September 2005), p. 352.

15. Smith used the term mercantile system, and German writers used Merkantilismus. Only later did mercantilism become a standard English term. Jacob Viner, “Mercantilist Thought,” in David L. Sills, ed., International Encyclopedia of the

Social Sciences, vol. 4 (New York: Free Press, 1968), p. 436; David A. Baldwin, Economic Statecraft (Princeton, NJ: Princeton University Press, 1985), p. 72.

16. Eli F. Heckscher, Mercantilism, vol. 2 (London: Allen and Unwin, 1934).

17. Adam Smith, The Wealth of Nations, vol. 1 (London: Dent & Sons, Everyman’s Library, 1910), bk. 4, p. 436.

18. Robert Gilpin with Jean M. Gilpin, The Political Economy of International

Relations (Princeton, NJ: Princeton University Press, 1987), p. 180.

19. Alexander Hamilton, “The Report on the Subject of Manufactures,” in Harold C. Syrett, ed., The Papers of Alexander Hamilton, December 5, 1791, vol. 10 (New York: Columbia University Press, 1966), p. 291.

20. Friedrich List, The National System of Political Economy, trans. Sampson S. Lloyd (London: Longmans, Green 1916), p. 130.

21. David Levi-Faur, “Friedrich List and the Political Economy of the Nation-State,”

Review of International Political Economy 4, no. 1 (Spring 1997), pp. 154–178.

22. Jonathan Kirshner, “Realist Political Economy: Traditional Themes and Contem- porary Challenges,” in Mark Blyth, ed., Routledge Handbook of International

Political Economy (New York: Routledge, 2009), p. 38.

23. List, The National System of Political Economy, p. 107.

24. David Levi-Faur, “Economic Nationalism: from Friedrich List to Robert Reich,”

Review of International Studies 23, no. 3 (July 1997), p. 359. Scholarly writing

during the interwar period included John Maynard Keynes, “National Self- Sufficiency,” Yale Review 22 (1933), pp. 755–769; Jacob Viner, “International Relations Between State-Controlled Economies,” American Economic Review 34,

no.1 suppl. (March 1944), pp. 315–329; and Lionel Robbins, Economic Planning

and International Order (New York: Macmillan, 1937).

25. Paul Kennedy, The Rise and Fall of the Great Powers: Economic Change and

Military Conflict from 1500 to 2000 (New York: Random House, 1987), p. 283.

26. Although U.S. government officials helped create the KIEOs, they subordinated their economic goals to security goals. U.S. realist scholars, by contrast, largely ignored economic issues. See Michael Mastanduno, “Economics and Security in Statecraft and Scholarship,” International Organization 52, no. 4 (Autumn 1998), p. 835. 27. Gilpin, “The Richness of the Tradition of Political Realism,” p. 294.

28. Gilpin, The Political Economy of International Relations, p. xii.

29. Theda Skocpol, “Bringing the State Back In: Strategies of Analysis in Current Research,” in Peter B. Evans, Dietrich Rueschemeyer, and Theda Skocpol, eds.,

Bringing the State Back In (New York: Cambridge University Press, 1985), pp. 6–7.

30. George Modelski, Long Cycles in World Politics (Seattle, WA: University of Washington Press, 1987), ch. 2; Joshua S. Goldstein, Long Cycles: Prosperity and

War in the Modern Age (New Haven, CT: Yale University Press, 1988), pp. 126–133.

31. Benjamin J. Cohen, International Political Economy: An Intellectual History (Princeton, NJ: Princeton University Press, 2008), p. 67.

32. David A. Lake, “Leadership, Hegemony, and the International Economy: Naked Emperor or Tattered Monarch with Potential,” International Studies Quarterly 37, no. 4 (December 1993), p. 485.

33. Robert Gilpin, War and Change in World Politics (New York: Cambridge University Press, 1981), p. 29.

34. Immanuel Wallerstein, “The Three Instances of Hegemony in the History of the Capitalist World-Economy,” in Immanuel Wallerstein, ed., The Politics of the World-

Economy: The States, the Movements and the Civilizations (London: Cambridge

University Press, 1984), p. 38.

35. Stephen Gill, ed., Gramsci, Historical Materialism and International Relations (New York: Cambridge University Press, 1993).

36. Duncan Snidal, “The Limits of Hegemonic Stability Theory,” International

Organization 39, no. 4 (Autumn 1985), pp. 585–586.

37. Charles P. Kindleberger, The World in Depression 1929–1939 (Berkeley, CA: University of California Press, 1973), p. 28. On the collective goods version of the theory see Michael C. Webb and Stephen D. Krasner, “Hegemonic Stability Theory: An Empirical Assessment,” Review of International Studies 15 (Spring 1989), pp. 184–186.

38. Snidal, “The Limits of Hegemonic Stability Theory,” pp. 590–592; Robert O. Keohane, After Hegemony: Cooperation and Discord in the World Political

Economy (Princeton, NJ: Princeton University Press, 1984), p. 65; Mancur Olson, The Logic of Collective Action: Public Goods and the Theory of Groups

(Cambridge, MA: Harvard University Press, 1965), pp. 14–15.

39. Stephen D. Krasner, “State Power and the Structure of International Trade,” World

Politics 28 (April 1976), p. 322.

40. Robert Gilpin, “The Politics of Transnational Economic Relations,” in Robert O. Keohane and Joseph S. Nye, Jr., eds., Transnational Relations and World Politics (Cambridge, MA: Harvard University Press, 1972), p. 58.

41. Wallerstein, “The Three Instances of Hegemony in the History of the Capitalist World- Economy,” pp. 44–46; Robert W. Cox, “Gramsci, Hegemony and International Relations: An Essay in Method,” in Stephen Gill, ed., Gramsci, Historical Materialism

Notes 75 42. Stephen D. Krasner, “Structural Causes and Regime Consequences: Regimes as

Intervening Variables,” in Stephen D. Krasner, ed., International Regimes (Ithaca, NY: Cornell University Press, 1983), p. 2.

43. Arthur A. Stein, “The Hegemon’s Dilemma: Great Britain, the United States and the International Economic Order,” International Organization 38, no. 2 (Spring 1984), p. 373.

44. Keohane, After Hegemony; Robert O. Keohane, “The Demand for International Regimes,” in Stephen D. Krasner, ed., International Regimes (Ithaca, NY: Cornell University Press, 1983), pp. 141–171.

45. Oran R. Young, “Regime Dynamics: The Rise and Fall of International Regimes,” in Stephen D. Krasner, ed., International Regimes (Ithaca, NY: Cornell University Press, 1983), pp. 98–101.

46. Eric Helleiner, States and the Reemergence of Global Finance: From Bretton

Woods to the 1990s (Ithaca, NY: Cornell University Press), p. 4; Theodore H.

Cohn, “The Changing Role of the United States in the Global Agricultural Trade Regime,” in William P. Avery, ed., World Agriculture and the GATT, International

Political Economy Yearbook, vol. 7 (Boulder, CO: Rienner, 1993), pp. 20–24;

Vinod K. Aggarwal, Liberal Protectionism: The International Politics of Organized

Textile Trade (Berkeley, CA: University of California Press, 1985), pp. 77–81.

47. Timothy J. McKeown, “Hegemonic Stability Theory and Nineteenth Century Tariff Levels in Europe,” International Organization 37, no. 1 (Winter 1983), p. 89; Peter F. Cowhey and Edward Long, “Testing Theories of Regime Change: Hege- monic Decline or Surplus Capacity?” International Organization 37, no. 2 (Spring 1983), pp. 157–188.

48. Samuel P. Huntington, “The Lonely Superpower,” Foreign Affairs 78, no. 2 (March/April 1999), pp. 35–49.

49. Kennedy, The Rise and Fall of the Great Powers, p. 533; Robert O. Keohane, After

Hegemony: Cooperation and Discord in the World Political Economy (Princeton,

NJ: Princeton University Press, 1984), p. 139.

50. Stephen Gill, “American Hegemony: Its Limits and Prospects in the Reagan Era,”

Millennium 15, no. 3 (Winter 1986), p. 331.

51. Joseph S. Nye, Jr., “Soft Power,” Foreign Policy 80 (Fall 1990), p. 166.

52. Charles Krauthammer introduced the idea of U.S. unipolarity in “The Unipolar Moment,” Foreign Affairs 70, no. 1 (1990/1991), pp. 23–33.

53. William Kristol and Robert Kagan, “Toward a Neo-Reaganite Foreign Policy,”

Foreign Affairs 75, no. 4 (July/August, 1996), pp. 21–22.

54. William Kristol and Robert Kagan, “Introduction: National Interest and Global Responsibility,” in Robert Kagan and William Kristol, eds., Present Dangers:

Crisis and Opportunity in American Foreign and Defense Policy (San Francisco,

CA: Encounter Books, 2000), p. 13.

55. Charles Krauthammer, “The Unipolar Moment Revisited,” The National Interest 70 (Winter 2002/2003), p. 17.

56. Francis Fukuyama, “After Neoconservatism,” The New York Times Magazine, February 19, 2006, p. 67.

57. Krauthammer, “The Unipolar Moment Revisited,” pp. 26–27.

58. Zheng Bijian, “China’s ‘Peaceful Rise’ to Great-Power Status,” Foreign Affairs 84, no. 5 (September/October 2005), pp. 18–24; David Zweig and Bi Jianhai, “China’s Global Hunt for Energy,” Foreign Affairs 84, no. 5 (September/October 2005), pp. 25–38. 59. “Which Way Now for French Policy?” The Economist, July 26, 2003, pp. 47–48;

60. Joseph S. Nye, Jr., The Paradox of American Power: Why the World’s Only Super-

power Can’t Go It Alone (New York: Oxford University Press, 2002), pp. 140–141.

61. Amitav Acharya, “Beyond Anarchy: Third World Instability and International Order After the Cold War,” in Stephanie G. Neuman, ed., International Relations

Theory and the Third World (New York: St. Martin’s Press, 1998), p. 165.

62. List, The National System of Political Economy, p. 154.

63. Stephen D. Krasner, Structural Conflict: The Third World Against Global Liberalism (Berkeley, CA: University of California Press, 1985), pp. 108–109.

64. Vlado Vivoda, “Resource Nationalism, Bargaining and International Oil Companies: Challenges and Change in the New Millennium,” New Political Economy 14, no. 4 (December 2009), pp. 517–534.

65. Krasner, Structural Conflict, p. 3; Robert L. Rothstein, The Weak in the World of

the Strong: The Developing Countries in the International System (New York:

Columbia University Press, 1977), p. 8.

66. On the government and late industrializers see Alexander Gerschenkron,

Economic Backwardness in Historical Perspective: A Book of Essays (Cambridge,

MA: Harvard University Press, 1962).

67. Chalmers Johnson, “Introduction—The Taiwan Model,” in James C. Hsiung, ed.,

Contemporary Republic of China: The Taiwan Experience 1950–1980 (New York:

Praeger, 1981), pp. 9–18. 68. Krasner, Structural Conflict, p. 7.

69. Joseph M. Grieco, “The Maastricht Treaty, Economic and Monetary Union and the Neo-realist Research Programme,” Review of International Studies 21 (January 1995), p. 34.

77

L

iberalism is the most influential perspective in IPE. Most international economic organizations and the economic policies of most states today are strongly influenced by liberal principles. However, the term liberal is used differently in IPE and in U.S. politics. Whereas U.S. conservatives support free markets and minimal government intervention, U.S. liberals support greater government involvement in the market to prevent inequalities and stimulate growth. Liberal economists, by contrast, have similarities with U.S. conservatives; they emphasize the importance of the free market and private property and seek to limit the government’s role in economic affairs. However, this chapter points to the fact that there are also variations among economic liberals. Although some liberal economists favor as little government involve- ment as possible, others believe that some government intervention is neces- sary for the effective functioning of markets.