Idea Transcript
International Political Economy Political Science 790:327:90 Terence Teo
Fall 2013
Course Description The study of international political economy (IPE), or simply political economy, is at once an old and new academic tradition. Its roots lie in moral philosophy; its concern, the pursuit of material wealth. Its most prominent offshoot is what we know as the field of economics today, yet politics is as much intertwined with economics today as the days of yore. Early political economists understood the relationship between economics and politics but unfortunately time drove apart these sister fields of scholarly inquiry, with each developing its own view of international affairs. It is not until recently (by recently, I mean the last four decades or so) that economic studies and political analysis came together in what can only be described as a reunion long in coming; its offspring is International Political Economy (IPE). At its heart, IPE concerns itself with the distribution of wealth, an issue that is inextricably linked to power. Harold Lasswell’s (1936) classic definition of politics: “Who gets what, when, and how?” rises once again to the fore. This course thus addresses a vast array of questions: How do we conduct economic activity across borders—buy and sell goods, invest and lend money, when political authority ends at national borders? Why do some countries adopt certain economic policies but not others? Why does the dollar go “up” and “down”, and how is this a political issue? Is the deficit the key economic problem facing the United States, and why? The purpose of this course is three-fold. First, it aims to help you develop a theoretical understanding of international political economy. By the end of the course, you should be able to identify the dominant perspectives/approaches and assess the strength and validity of different arguments. Second, it seeks to shed light on the paths the global economy has taken, and the ideas and events that have shaped and continue to shape the world today. Finally, I hope you will emerge from the course more capable of discussing contemporary international economic and political issues in a critical, thoughtful and coherent way. The course consists of four substantive sections: I. Nuts and Bolts introduces you to the dominant perspectives in the field of international political economy; perspectives that attempt to provide explanations for these big questions: What are the economic and political realms and how do they relate? What is economic and political power and how do they interact? What is economic interdependence and its modern manifestation, globaliza-
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tion? What is the interplay between interests and institutions? II. Global Trade looks at the economic interactions and trading relationships between states, and the effects on individuals and nations alike: the evolution of the global trade regime, issues such as preferential trade agreements, regionalism, anti-dumping disputes, foreign economic policy as political leverage, international trade cooperation, and the role of trade in economic development. III. Global Finance examines international monetary relations: the origins, institutions and operation of the postwar monetary regime, and issues such as exchange rates, foreign direct investment (FDI), the role of central banks, the World Bank and International Monetary Fund (IMF), and debt, financial and currency crises. IV. Contemporary Issues takes on some of the “newer” issues that are becoming increasingly relevant today. These include economic relations between advanced and developing countries, the role of multinational corporations (MNCs), the politics of foreign aid, debt relief, and the developmentenvironment-population-resources tangle.
Course Requirements The online nature of this course means that it will take place on the eCollege web site. I will do my best to ensure that all resources will be available online for you to access at your convenience. International political economy is a subfield that spans several disciplines. Accordingly, we will read (and discuss) history, economics, and to a lesser extent, sociology and philosophy, in addition to political science. That said, this is a political science course, and we will focus more on how politics affect economic relations among (and sometimes within) nations. Some weeks involve significantly more reading than others, so plan accordingly. You will be evaluated along the following criteria: 1. Participation comprises 40% of your grade and is based on VoiceThread contributions. Each VoiceThread session contains question slides that you are to answer. Late entries and comments will not be accepted and will receive zero points. 2. You will write two essays (10% each for a total of 20%). They are to be between 5 to 7 pages, double spaced, have one-inch margins and an 11-point font. All of you should be wellversed in the requirements of paper writing. The prompts for the two papers will be posted on eCollege when the time comes. 3. There will be a cumulative final exam (40%) at the end of the course. This will consist of identification/definition, short-answer, and essay questions. There is no make-up. 4. You must fulfill all requirements above to receive a passing grade for the course. Put another way, if you do not turn in one essay (or do not take the final exam), you will fail the course irrespective of how you did on the remaining requirements. 5. I reserve the right to make changes at any point in the semester if deemed necessary. For the bullet-point inclined, the breakdown of your grade will be as follows:
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◃ VoiceThread Participation: 40% ◃ Short Essays (2 x 10%): 20% ◃ Final Exam: 40% ◃ Total: 100%
Academic Integrity Be familiar with the University’s policies on academic integrity and disciplinary action. All students (and the instructor) are expected to comply with the Rutgers University Code of Academic Integrity which can be accessed at http://academicintegrity.rutgers.edu/students.shtml. Any violations of this code will be addressed using existing procedural guidelines. Remember that the same technology (read: Google) that has made plagiarism easier to accomplish has also made it easier to detect. When in doubt, cite! The charge of plagiarism is ugly and unkind; not only will I be disappointed (and furious!), but you will most likely receive a grade of “F” in the course (penalties range from re-doing work to expulsion). If you have any questions on how to use citations or about plagiarism, please ask!
Text In lieu of a required text, we shall read scholarly papers and selections from key works and books. These will be made available online at the course’s eCollege website. I also highly recommend you read one of the following reputable newspapers: The Economist, Le Monde Diplomatique, the New York Times, the BBC, or a comparable international paper. Keeping upto-date with international events will enrich your experience in the course and allow you to bring to bear what you learn in class on real world issues.
Course Schedule and Readings [Required readings are bulleted with a • and recommended readings, with a †.] Introduction and Course Overview • (This) Syllabus The -ologies, the Scientific Method, and a Brief Walk Down Memory Lane • Excerpt from Clark, Gregory. (2007) A Farewell to Alms: A Brief Economic History of the World. Princeton University Press: Princeton, NJ. • Excerpt from Landes, David. (1998) The Wealth and Poverty of Nations. † North, Douglass and Robert P. Thomas. (1970) An Economic Theory of the Growth of the Western World. Economic History Review 23(1): 1–17.
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Nuts and Bolts The Worldly Philosophers: Mercantilism, Liberalism, and Marxism • Excerpt from List, Friedrich. (1841) The National System of Political Economy. • Excerpt from Smith, Adam. (1776) An Inquiry into the Nature and Causes of the Wealth of Nations. • Marx, Karl and Friedrich Engels. (1848) The Communist Manifesto. The Battle of Ideas • Excerpt from Hayek, Friedrich. (1944) The Road to Serfdom. • Excerpt from Polanyi, Karl. (1944) The Great Transformation. • Excerpt from Friedman, Milton. (1962) Capitalism and Freedom. Core Concepts: Assumptions, Rationality, and the Theory of Games † Appendix from O’Neill, Barry. (1999) Honor, Symbols and War
Global Trade Another Brief Walk Down Memory Lane: The Evolution of the Global Trading Regime • Kindleberger, Charles P. (1975) The Rise of Free Trade in Western Europe. The Journal of Economic History 35(1): 20–55. [Read from the bottom of page 23 to page 51.] • Lake, David A. British and American Hegemony Compared: Lessons for the Current Era of Decline. † Gallagher, John and Ronald Robinson. (1953) The Imperialism of Free Trade. The Economic History Review 7(1): 1–15. Why Trade? The Logic of Comparative Advantage • Coughlin, Cletus C. (2002) The Controversy Over Free Trade: The Gap Between Economists and the General Public. Federal Reserve Bank of St. Louis (Jan): 1–22. • Krugman, Paul. (1993) What do Undergrads Need to Know about Trade? American Economic Review 83(2): 23–26. • Excerpt from Ricardo, David. (1821) The Principles of Political Economy and Taxation. † Krugman, Paul. (nd) Ricardo’s Difficult Idea. Interest Groups and the Demand for Protection 4
• Eichengreen, Barry. The Political Economy of the Smoot-Hawley Tariff. • The Battle of Smoot-Hawley, The Economist, December 20, 2008. • Rogowski, Ronald. (1987) Political Cleavages and Changing Exposure to Trade. American Political Science Review 81(4): 1121–1137. Political Institutions and the Supply of Protection • Elliott, Kimberly A. (2005) Big Sugar and the Political Economy of US Agricultural Policy. Center for Global Development Brief. • Bailey, Michael A. Judith Goldstein, and Barry R. Weingast. (1997) The Institutional Roots of American Trade Policy: Politics, Coalitions, and International Trade. World Politics 49: 309–338. † Alt, James E and Michael Gilligan. The Political Economy of Trading States: Factor Specificity, Collective Action Problems, and Domestic Political Institutions. † Milner, Helen V. and Benjamin Judkins. (2004) Partisanship, Trade Policy, and Globalization: Is There a Left-Right Divide on Trade Policy? International Studies Quarterly 48: 95–116. Trade and States • Hart, Jeffrey A and Aseem Prakash. (1997) Strategic Trade and Investment Policies: Implications for the Study of International Political Economy. The World Economy 20(4): 457–476. • Rodrik, Dani. (1995) Getting Interventions Right: How South Korea and Taiwan Grew Rich. Economic Policy 20: 55–107. • Panagariya, Arvind. (2004) Miracle and Debacles: In Defence of Trade Openness. World Economy: 1149–1171. † Goldstein, Andrea E. and Steven M. McGuire. (2004) The Political Economy of Strategic Trade Policy and the Brazil-Canada Export Subsidies Saga. World Economy: 541–566. † Krasner, Stephen. (1976) State Power and the Structure of International Trade. World Politics 28(3): 317–347. International Trade Cooperation and the World Trade Organization • Crowley, Meredith A. (2003) An Introduction to the WTO and GATT. Economic Perspectives 42–57. • Deardorff, Alan and Robert Stern. (2002) What You Should Know About Globalization and the WTO. Review of International Economics 10(3): 404–423. † Davey, William J. (2005) The WTO Dispute Settlement System: The First Ten Years. Journal of International Economic Law 8: 17–50.
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Global Finance The Balance of Payments and the Evolution of the Global Financial System • Frieden, Jeffrey and David A. Lake. Money and Finance. † Humpage, Owen. (2004) A Hitchhiker’s Guide to the U.S. Current Account Problem. Economic Commentary: Federal Reserve Bank of Cleveland. Exchange Rates, the Trilemma and the Gold Standard • Federal Reserve Bank of New York. (2002) The Basics of Foreign Trade and Exchange. • Frieden, Jeffry A. (1991) Invested Interests: The Politics of National Economic Policies in a World of Global Finance. International Organization 45(4): 425–451. † Humpage, Owen. (1998) A Hitchhiker’s Guide to Understanding Exchange Rates. Economic Commentary: Federal Reserve Bank of Cleveland. † Broz, J. Lawrence and Jeffry A. Frieden. (2001) The Political Economy of International Monetary Relations. Annual Review of Political Science 4: 317–340. Society and Exchange-Rate Politics • TBD Exchange-Rate Politics, Central Banks, and the Time-Inconsistency Problem • TBD Multinational Corporations and Foreign Direct Investment: Boon or Bane? • A Cruel Sea of Capital, The Economist, May 1, 2003. • Drezner, Daniel (2000). Bottom Feeders. Foreign Policy (Nov/Dec): 64–70. • Caves, Richard. The Multinational Enterprise as an Economic Organization. • Tarzi, Shah. Third World Governments and Multinational Corporations: Dynamics of Host Bargaining Power. † Fagre, Nathan and Louis T. Wells. (1982) Bargaining Power of Multinationals and Host Governments. Journal of International Business Studies 13(2): 9–23. † Fieldhouse, David. ‘A New Imperial System’? The Role of the Multinational Corporations Reconsidered. † Strange, Susan (1992). States, Firms and Diplomacy. International Affairs 68(1): 1–15.
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Contemporary Issues Tensions in Developing Countries • Rodrik, Dani. (2002) Argentina: A Case of Globalization Gone Too Far or Not Far Enough? • Cohen, Benjamin J. The Triad and the Unholy Trinity: Problems of International Monetary Cooperation. • Schmukler, Sergio L. Financial Globalization: Gain and Pain for Developing Countries. • Dollar, David. Globalization, Poverty and Inequality since 1980. Tensions in Industrialized Countries • Freeman, Richard B. Are Your Wages Set in Beijing? • Kull, Steven. (2001) Culture Wars? • Schelling, Thomas (2002). What Makes Greenhouse Sense? Foreign Affairs 81(2): 2–9. † Cline, William R. (2006) The US External Deficit and Developing Countries. Center for Global Development Working Paper 86. † Portney, Pual (2000). Environmental Problems and Policy: 2000–2050. Journal of Economic Perspectives 14(1): 199–206. † Evans, David (2002). Who Owns Ideas? The War over Global Intellectual Property. Foreign Affairs 81(6): 160–166.
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