International Political Economy _IPE_ by hcj


									International Political Economy
           International College
           Khon Kaen University

    Week 3 – Theoretical Approaches to IPE
   Theoretical Approaches in IPE
• International Political Economy (IPE) became a
  separate field of study only in the last 35-40
• IPE draws on a number of academic theories
  from political science and economics and
  attempts to merge these
• How states, organizations and people see IPE
  as affecting them is determined by their
  theoretical perspective
    Theoretical Approaches in IPE
• Theoretical approaches to understanding IPE
  have generally focused on the three main
  “schools”, or ways of explaining international
  politics – then adding an economic dimension
• The three main theoretical approaches and their
  IPE variations:
  – Realism: nationalism, mercantilism, statism
  – Liberalism: economic liberalism
  – Marxism: radicalism, structuralism, dependency
   Theoretical Approaches in IPE

• These three main approaches sometimes
  conflict, sometimes complement each other
  and have been endlessly modified in an effort
  to explain IPE
• Other modern variations combine elements
  taken from at least two of the main
  theoretical schools:
  – Constructivism
  – Complex interdependence
    Theoretical Approaches in IPE
• These different approaches shape major
  debates on economic distribution and
  redistribution in IPE
• Like their theoretical political counterparts,
  IPE approaches differ in:
  – Views on basic human nature
  – The relationship between individuals, society, the
    state and markets
  – The relationship between domestic and
    international society
   Theoretical Approaches in IPE
• To understand theories of international
  relations and IPE, we need to consider how
  these are driven at three levels:
  – at the individual level (the motivation of leaders,
    according to their personality)
  – at the state level (national domestic
    considerations, such as type of government
    and/or economic system)
  – at the international level (openness to
    international dialogue and cooperation)
Theories in IPE – Realism (Statism)
• Realists have a dark view of human nature
• Individuals are selfish, power-seeking and
• States act only in national self-interest
  (economically as well as for power and
  prestige), are aggressive and security-conscious
• The international system is anarchic (there is no
  higher authority than the state) and stability is
  achievable only through a balance of power
Theories in IPE – Realism (Statism)
• The realist interpretation of IPE is basically
  “might makes right”
• If your’s is a big and powerful country, you can
  set the terms of any (ie.) trade agreement
  based on the needs and interests of your
  economy alone
• If your’s is a small and vulnerable country, you
  had best form alliances with others to protect
Theories in IPE – Realism (Statism)
• Some tenets of realist theory:
  – sovereign nation states are the main actors in
    international affairs
  – intergovernmental organisations, NGOs and
    multinational corporations are of secondary
    importance, and are dispensable
  – states are in competition with each other
  – relations between states are determined by their
    relative levels of power
  – power is determined by military and economic
      Theories in IPE - Liberalism
• Liberals believe that human nature is basically
• Individuals are moral, want to improve the
  world and will cooperate with others
• States are not independent (economically or
  in terms of international obligations)
• The international system is a good and viable
  mechanism for states to cooperate and to
  develop interdependence
      Theories in IPE - Liberalism
• The liberal interpretation of IPE is basically
  idealist and optimistic – “let’s work together to
  make this a better world”
• Injustice, poverty, inequality, war and aggression
  are not inevitable, but can be moderated or
  eliminated through collective action or
  institutional reform
• Liberals believe in justice, fairness and equality –
  internally and internationally – and believe that
  we all have a responsibility to create a more just
      Theories in IPE - Liberalism
• Some tenets of liberalist theory:
  – trade wars are preventable
  – intergovernmental organizations and NGOs are
    necessary and valuable means of collective
    problem solving and action
  – free markets, free trade and multinational
    corporations increase interdependence and
    reduce the risk of war
  – have faith in international law
  – states fare better, both individually and
    collectively, if they cooperate with each other
  – power is determined not just by military and
    economic strength, but also by morality and “good
       Theories in IPE - Marxism
• Marxists see every relationship in terms of
  social and economic class
• The actions of individuals are determined by
  their class
• States are independent but not free: their
  actions are determined by the established
  world economic order
• The international system is dominated by
  wealthy capitalist states and cannot be trusted
       Theories in IPE - Marxism
• The Marxist world view of IPE is a struggle
  between the “haves” and the “have nots”
• The capitalist countries which control the bulk
  of world trade, world finance and are home to
  most multinational corporations will continue
  to exploit poorer countries
• The hierarchical world system of economic
  imperialism, exploitation and struggle for
  resources dictates how states interrelate
      Theories in IPE - Marxism
• Some tenets of Marxist theory:
  – Clashes between developed capitalist countries
    and subordinate countries is inevitable
  – Economic factors are of primary importance in
    determining the relationship between states
  – The global system is hierarchical: only states on
    the same socioeconomic level can be trusted
  – International law, international organizations,
    NGOs and multinational corporations are all
    suspect as they are controlled by the capitalist
        Modern Theories in IPE
• The three main traditional theoretical approaches
  to IPE may often not be able to explain all the
  changes that have taken place in the global
  political economy
• As a result each of the three theories has one or
  more modern variations:
  – Realism is now more often neorealism or
  – Liberalism has split into idealism, neoliberalism
    and neoliberal institutionalism
  – Marxism also has two modern versions –
    dependency theory and world-systems theory
        Modern Theories in IPE
• In addition to variations on the main
  theoretical approaches, there have been some
  efforts to merge, or mix and match elements
  of two or more of these theories
• Foremost amongst these are Complex
  Interdependence and Constructivism
• Both share the view that since the world is so
  complicated no over-arching theory in IPE is
  going to be convincing all the time
   Theories in IPE - Constructivism
• Constructivists place most emphasis on the character
  of individuals – as it is individuals (singly or
  collectively) who make decisions on international
• Often like-minded individuals will work together - a
  notion supported by the structure of political parties
  in most countries
• On the international scene too, the concept of like-
  minded individuals working together better explains
  why things happen as they do than realism,
  liberalism or Marxism can explain them
         Modern Theories in IPE
• Each school of theorists develops more
  sophisticated and complicated models of their
  favorite theory in an effort to explain the
  multitude of political and economic relationships
  between countries
• But in reality, these relationships are determined
  by a diverse range of factors – personalities,
  political parties, different types of government
  each having a different culture, history, sense of
  security and view of the world
• Neat and tidy categorization is never going to be
  wholly satisfactory

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