International Political Economy

What needs to be identified when solving a question in IPE?

Main actors, actors’ preferences and strategy, institutional context actors operate in.

What are the three classical perspectives in IPE?

Economic Nationalism, Liberalism and Marxism.

How do Markets and States operate on fundamentally opposed logic?

States are all about national autonomy and political unity while Markets want the elimination of political obstacles for max trade outcomes.

What are Economic Nationalism’s core Ideas?

Thinks that politics is more important than economics and national security is the most important. Economic activities should serve political goals. focuses on relative gains because the international system is anarchical and they are focusing on protection.

What are the core ideas of merchantilism?

wealth is finite and thus there is intense competition between states.

What are the core ideas of liberalism?

Supremacy of the market, against gov intervention to restrict the market, focuses on absolute gains.

What are absolute gains?

Total increases in wealth or benefits

What are relative gains?

Proportional increases in wealth between parties.

What is Marxism’s core idea?

Economics drives politics and political conflict comes from economic disagreements and class struggles.

How does traditional marxism understand the state?

as a mouthpiece for the bourgeoise.

What is comparative advantage?

The ability of a country to produce a good at a lower opportunity cost than another country, leading to more efficient trade and specialization.

what are the problems with comparative advantage?

It creates winners and losers in an economy and has unrealistic assumptions about adjustment and transaction costs, as well as underestimating the significance of consumer preferences.

What are the forms of trade protection?

Tarrifs, subsidies, quotas, anti-dumping regulations, health and safety regulations, government purchasing.