SUST 2001 - IPE

International Political Economy (IPE)

Studies how politics shape the global economy and how the global economy shapes politics.

Neo-Classical Economics

Relies on simple market demand and minimal state intervention.

Keynesian Economics

Involves the use of monetary and fiscal policy to offset poor private sector decisions, such as driving demand up during a recession.

Beggar-Thy-Neighbor

Economic policies attempting to remedy one nation's economic issues at the expense of another, such as tariff wars or dumping.

Strong State vs. Weak State Structure

Refers to the amount of centralisation within a state; a more centralised state is stronger because it has direct command and control ability to micromanage its economy.

Monetary Policy

The use of money supply levers, like interest rates, used by central banks to deal with inflation, price stability, and currency.

Fiscal Policy

The use of spending or taxation levers the government uses to monitor, adjust, or direct a national economy.

Interest Rates

Levers adjusted in monetary policy to make money "cheaper" or more expensive to borrow.

GATT & WTO

The General Agreement on Tariffs and Trade was created post-WWII to avoid trade wars, and it eventually became the World Trade Organization in 1995 to enforce fairer trade.

Economic Structuralism

State-directed economic policies that shift resources into desired industries, often transitioning from agriculture to manufacturing.

Communism

In Marxist theory, the final stage leading to full enfranchisement of the population. Economically, it manifested as state-run centrally planned models in the Soviet bloc.

Terms of Trade

The price of a country's exports relative to the price of its imports.

Backward Linkages

Occurs when the product of one finished good increases the demand for the needed components, essentially building a supply chain.

Pecuniary External Economies

The interdependency between market processes, referring to the complimentary industrial capacities of backward linkages.

First Mover Status

A competitive advantage gained by a company or state-owned business from being the first to enter a market.