Key Concepts in International Political Economy

International Political Economy (IPE)

IPE is the intersection of Politics and Economics across borders. International trade theories, a topic within IPE, ask about the relationships between MARKETS and STATES.

Liberalism (in IPE)

Liberalism is one of the major theories in IPE. Associated with Adam Smith (18th century). Discusses opening markets across borders, predicting free trade capitalism. Primary policy is Free trade. Advocates for states letting markets operate with no interference. Interference is seen as detrimental, or states should HELP businesses. Under liberalism, the market determines costs and quality. Key outcomes expected are comparative advantage, competition, efficiency, and innovation. Policy aims to reduce barriers to the market (like tariffs). In the relationship between politics and economics, liberalism views Economics as driving Politics. In the state's role, under liberalism, the state works for economics/business. Realism can be liberal, pursuing FREE TRADE FOR RELATIVE GAIN.

Mercantilism

Associated with Alexander Hamilton (19th century), who sought to counter Free Trade challenges. Emphasizes State interest in the economy for national purposes. The primary policy is protectionism. Aims to Protect from the forces of the market. Advocates for the use of barriers for the state. The state INTERVENES in the market on behalf of its national interests. Can also be seen as modern "protectionism" or "economic nationalism". A SIGNIFICANT Difference between Liberalism and Mercantilism is the role of the state. In the relationship between politics and economics, mercantilism views Politics as driving Economics. For mercantilists, economics/business works for the state/politics. Realism is similar to mercantilism.

Protectionism

The primary policy or means of Mercantilism. It is a policy or strategy. Reasons for using protectionist policies include: Political demands from special interests (domestic politics), Infant industries, National security, Response to predatory policies, such as dumping. Means or methods of protectionism include: Tariffs, Quotas, Subsidies, Restrictions/regulations ("red tape" - NON-TARIFF BARRIERS), Economic nationalism (e.g., "buy American," Fuji film).

Japanese Case Study (Mercantilism and Protectionism)

Japan is cited as a case study in the use of protectionism (now often illegal). Japan was NOT a late developer, having industrialized by the turn of the 20th century. The case study shows how mercantilism and protectionism worked for Japan, focusing on: Infant industry development, Building domestic market share, Gaining international market share. The state was involved in every aspect of the economy. Japan was protectionist from the beginning. Protectionism helped develop the domestic market and protected it from international manufacturers. This was done using means like tariffs, quotas, subsidies, and economic nationalism. Once Japan established domestic power, it moved to international power. This was achieved through continued protectionism. Once Japanese industries (like automobiles and steel) established themselves in the market, Japan became more oriented towards FREE TRADE and LIBERALISM.

Asian Model

Some other East Asian countries (South Korea, Hong Kong, Singapore) followed this model, sometimes called the 'Asian Tigers'.

Obsolete

The model is now considered obsolete as many of its methods are now illegal, replaced by free trade.

Globalization

Defined as the expansion of free trade everywhere. Involves opening up all markets and states to the global economy. Goal is to sell the products and ideas of the world in every state. Characterized by the rapid expansion of global markets, reaching a powerful peak by the late 1990s to about 2008.

Anti-Globalization Protests

These protests focus on the negative effects of expanded free trade. Concerns raised include: Environment (e.g., sea turtles, dolphins, deforestation, industrial output), Labor (e.g., conditions, limitations, wages), Human rights/culture. Protesters often target institutions like the WTO. Groups who protest include labor, human rights groups, and environmental groups.

GATT (General Agreement on Tariffs and Trade)

Created in 1947 in Havana, via the UN. It was a LOOSE institution that met in rounds. The final round was the Uruguay Round (1986-1994). Faced major problems that led to the creation of a permanent organization.

WTO (World Trade Organization)

Created in 1995. Formerly GATT. A powerful International Organization (IO). Enforces trade regimes. Also addresses development, environment, human rights, etc.

MFN (Most-Favored Nation)

A concept related to the WTO. Means Reciprocal levels of free trade for all members.

Bretton Woods System

Refers to the international economic institutions created after World War II. Included institutions like the IMF and World Bank. Established an international currency system.

World Bank

An international economic institution established under the Bretton Woods system. Includes IBRD, IDA, and IADB.

Uruguay Round

The final round of GATT negotiations that took place from 1986 to 1994.

International Trade Organization (ITO)

Planned at Bretton Woods but never materialized, leading to the creation of GATT instead.

Fixed Exchange Rate System

Supported a fixed exchange rate system, initially based on the gold standard, pegged to the US dollar.

Gold Standard

A monetary system where a country's currency or paper money has a value directly linked to gold.

Steel Tariff Case

A notable ruling by the WTO against the US regarding tariffs on steel.

Labor Groups

Organizations that advocate for the rights and conditions of workers.

Human Rights Groups

Organizations that advocate for the protection and promotion of human rights.

Environmental Groups

Organizations that advocate for the protection of the environment.

Seattle Meeting

A notable WTO meeting that faced significant protests.

Doha Meeting

A notable WTO meeting held in Doha, Qatar.

Cancun Meeting

A notable WTO meeting held in Cancun, Mexico.

Hong Kong Meeting

A notable WTO meeting held in Hong Kong.

Economic Nationalists

Individuals or groups who prioritize domestic industries and jobs over free trade.

Protectionists

Individuals or groups who advocate for trade policies that protect domestic industries from foreign competition.

reconstruction

Originally lent for post-war and infrastructure development.

infrastructure development

Originally lent for reconstruction (post-war).

POVERTY ALLEVIATION

Shifted towards this focus, becoming very similar to the IMF.

Structural Adjustment Lending

Engages in this lending and imposes Structural Adjustment Policies.

Structural Adjustment Policies

These policies affect state economic foreign policies.

The World Bank's Mission Creep

Refers to the bank's expanded mission.

IMF (International Monetary Fund)

An international economic institution established under the Bretton Woods system.

Coordinate international currency exchange

One of the original mandates of the IMF.

Support and monitor the fixed exchange rate

This was one of the most important original functions of the IMF.

Lender of last resort

The IMF changed to become this development lender, lending to poor countries.

Fund Conditionality

Refers to the original conditions and how they have changed.

Moral Hazard

An issue that works both ways in the context of the IMF.

International Organizations (IOs)

Studied in the context of mitigating anarchy and promoting world order.

principles, rules, norms and procedure

These govern state behavior in specific issue areas of IR, defining International Regimes.

League of Nations

Created Post WWI to provide Collective Security.

Collective Security

Intended purpose of the League of Nations.

unanimity

Required for decisions in the League of Nations, an 'all or nothing' approach.

Failure

Known for this, with reasons including no universal membership and a rigid structure.

United Nations (UN)

Replaced the League of Nations.

UN Security Council (UNSC)

One of the major organs of the UN.

UN Security Council (UNSC)

Not universal in membership.

UN Security Council (UNSC)

Power rests in the UNSC, heavily weighted towards the PERM 5 members and their veto power.

UN Security Council (UNSC)

The PERM 5 states are power states with nuclear weapons: China (instead of Taiwan), France, Russia, UK, and US (implied from context).

UN Security Council (UNSC)

Has 5 veto votes belonging to the Perm 5.

UN Security Council (UNSC)

Its domain covers all issues relating to the use of force or sanctions, and all issues relating to security.

UN Security Council (UNSC)

There are 15 states on the UNSC at once (5 Perm 5 + 10 non-permanent).

UN Security Council (UNSC)

Non-permanent members serve two-year terms.

UN Security Council (UNSC)

Rotating members come from different regions.

UN Security Council (UNSC)

Some states want permanent seats but are not Perm 5 (e.g., Germany, Japan, India, Brazil, South Africa are sometimes mentioned).

UN Security Council (UNSC)

Elects the Secretary General upon nomination by the Perm 5.

UN Security Council (UNSC)

Cold War cooperation was limited, but increased Post Cold War.

UN Peacekeeping

Not explicitly in the UN charter.

UN Peacekeeping

Developed between Chapter 6 (peaceful settlement) and Chapter 7 (use of force), sometimes called 'Chapter 6 and a half'.

UN Peacekeeping

Attributed to Dag Hammarskjold.

UN Peacekeeping

Traditional/Classical Peacekeeping (late 50s to late 80s) involved lightly armed Blue Helmets.

UN Peacekeeping

Deployed post-conflict.

UN Peacekeeping

Small missions.

UN Peacekeeping

Roles included monitoring and observing, acting as a buffer, and reporting data (unbiased reporting, info gathering).

UN Peacekeeping

First mission was during the Suez crisis.

UN Peacekeeping

Post Cold War, peacekeeping massively expanded.

UN Peacekeeping

Reasons for expansion include the end of the Cold War (leading to cooperation in the UNSC and more trouble spots) and Boutros-Ghali's Agenda for Peace.

UN Peacekeeping

Boutros-Ghali's Agenda for Peace (1992) suggested the time of absolute sovereignty had passed and asked for more expansive roles and missions, including peacebuilding or peace enforcement.

UN Peacekeeping

Examples of expanded missions include Somalia, Yugoslavia (Bosnia, Kosovo), Cambodia, El Salvador, Western Sahara.

UN Peacekeeping

Expanded missions were more numerous and expensive.

UN Peacekeeping

Key examples like UNTAC (Cambodia) and UNOSOM (Somalia) highlight the shift towards more complex mandates involving security and civil tasks.

UN Peacekeeping

Mission Creep occurred, where missions moved away from their original mandates (e.g., UNOSOM II in Somalia became more unilateral).

UN Peacekeeping

Perceived failures in Somalia, Cambodia, and Bosnia (where outcomes were not acceptable relative to costs) were assigned to Boutros Ghali.

UN Peacekeeping

The US essentially fired him.

International consensus

A primary condition needed for modern peacekeeping to succeed.

Domestic consent

A primary condition needed for modern peacekeeping to succeed.

Achievable, realistic mandates

A primary condition needed for modern peacekeeping to succeed.

International Law (I-LAW)

Cooperation in the non-security world (like trade, environment, human rights) is flourishing.

Sources of I-LAW

The two most important sources are Treaty and Custom.

Treaty

Signed agreements (bilateral, multilateral, open) serving as a building block.

Pacta sunt servanda

The principle that treaties should be obeyed.

Custom

Must be accepted as a custom by states; often leads to treaties.

Opinio juris

The principle that custom should lead to treaty, making stronger law.

Legal Positivism

Refers to positive law, which is WRITTEN, CODIFIED, SIGNED.

Enforcement of International Law

Is MOST DIFFICULT and depends on reciprocity, collective action, and norms of international behavior.

ICJ (International Court of Justice)

One of the major organs of the UN, also known as the World Court.

World Court

Another name for the ICJ, which replaced the PCIJ of the League of Nations.

Advisory body

The function of the ICJ is mostly reduced to this.

State to state cases

The ICJ hears only these types of cases.

Optional clause

Allows states to accept the court's jurisdiction, but it doesn't always work well.

International Criminal Court (ICC)

A permanent court to hear cases of war crimes and other serious international crimes.

Rome Statute

Established the ICC in 1999 and covers specific types of crimes.

Ratification of the Rome Statute

The treaty was ratified by 60 states in 2002, bringing the ICC into existence.

Types of crimes covered by ICC

Includes war crimes, crimes against humanity, genocide, and aggression.

Complimentarity

The principle that the ICC will only step in if national courts are unable or unwilling to investigate and prosecute.

UCMJ (Uniform Code of Military Justice)

US law stating the US does investigate, prosecute, convict, and sentence its own personnel.

Extraterritoriality

Is RESPECTED by the ICC.

Advantages of ICC over ad hoc tribunals

Includes that it is standing (not ad hoc), has clear positive law, and is not seen as 'victor's justice'.