Politics 240
International Political Economy

Vincent Ferraro
103 Skinner
Ext. 2669

Purpose of the Course

This course introduces some of the fundamental relationships between politics and economics, on both the domestic and international levels. Its purpose is not to assert either the primacy of economics or politics, but rather to show how these two aspects of human behavior are mutually dependent and how, over time, economics and politics generally support each other in a coherent social system. Moreover, the course will show how, on the international level, political decisions intervene on all economic decisions and economic constraints shape political possibilities.

Course Format

The format of this course is experimental. We shall try to go through each reading in class and the intention will be to learn how to read critically. My initial conceptualization of the course will be to give a brief overview lecture for each class and then to post the readings onscreen. We will then, as a class, go through each reading in order to parse out the author's intent, and where the author succeeds of fails in making a persuasive point.

To this end, the readings for each class are very short. In addition, I have posted a "central" question that each reading poses in the syllabus ino order to help you do the readings with a more focused perspective.

We shall see how this format works. If it turns out not to be productive or interesting, then I reserve the right to change the format.

Evaluations will be based on a mid-term due on October 16) and a final (handed out on December 4 and due no later than the last day of exams, December 20), each comprising 45% of the final grade. Class participation will make up the final 10% of the grade. Both the mid-term and the final are take-home exams with open books and open discussion.

4 September--Introduction

History of the World Economy

9 September--The Development of the World Economy

Question: Why did Europe grow economically so much faster than the rest of the world in the modern period?

Angus Maddison, The World Economy: A Millennial Perspective (Paris: OECD, 2001), Chapter 1, "Introduction and Summary," pp. 17-25

Excerpt from Ronald Findlay and Kevin H. O'Rourke, Power and Plenty: Trade, War, and the World Economy in the Second Millennium (Princeton: Princeton University Press, 2007), pp. 353-364.

11 September--Mercantilism

Question: What is the relationship between "Power and Plenty" to "Private and Public Power"?

Jacob Viner, "Power and Plenty as Objectives of Foreign Policy in the Seventeenth and Eighteenth Centuries," World Politics, Vol. 1, no. 1 (October 1948)

16 September--The Historical Significance of Market Capitalism

Question: Is Market Capitalism "Natural"?

Karl Polanyi, The Great Transformation: The Political and Economic Origins of Our Time (Boston: Beacon Press, 1944), Excerpts from Chapter 6, "The Self-Regulating Market and the Fictitious Commodities: Labor, Land, and Money," pp. 68-76

18 September--The Political Logic of Market Capitalism

Question: Is Economic Freedom a Necessary Condition for Political Freedom?

Excerpts from Milton Friedman, Capitalism and Freedom (Chicago: University of Chicago Press, 1962), Chapter 1, "The Relation Between Economic Freedom and Political Freedom," pp. 7-17.

23 September--The Countermovement

Question: Is the Countermovement populated simply by the "losers?"

Karl Marx and Frederick Engels, Manifesto of the Communist Party (Excerpt), 1848

Globalization as the Underlying Process in International Political Economy

25 September--Globalization 1.0

Question: Is Globalization a Euphemism for Imperialism?

The Largest Historical Empires


John Maynard Keynes, Excerpt from Chapter II, "Europe Before the War", in The Economic Consequences of the Peace (1920)

Martin Walker, "Globalization 3.0," Wilson Quarterly, Autumn 2007

30 September--Globalization 2.0

Question: Was Globalization an Objective of the European States in the late Nineteenth Century?

John Gallagher and Ronald Robinson, "The Imperialism of Free Trade," The Economic History Review, Second series, Vol. VI, no. 1 (1953)

Excerpt from Kevin H. O'Rourke and Jeffrey G. Williamson, Globalization and History: The Evolution of a Nineteenth Century Atlantic Economy (Cambridge: MIT Press, 1999), pp. 33-41.

2 October--The Bretton Woods System

Question: Why Were Multilateral Institutions Necessary to Twentieth Century Globalization?

Robert Gilpin, "The Rise of American Hegemony," in Two Hegemonies: Britain 1846-1914 and the United States 1941-2001 edited by Patrick Karl O'Brien and Armand Clesse (Aldershot: Ashgate Publishing, Ltd., 2002), pp. 165-182

Benjamin Cohen, "Bretton Woods System," Routledge Encyclopedia of International Political Economy

7 October--The Washington Consensus

Question: Were the Roots of the Washington Consensus Economic or Ideological?

John Williamson, "A Short History of the Washington Consensus," Senior Fellow, Institute for International Economics, Paper commissioned by Fundación CIDOB for a conference “From the Washington Consensus towards a new Global Governance,” Barcelona, September 24–25, 2004.

W.W. Rostow, The Stages of Economic Growth: A Non-Communist Manifesto (Cambridge: Cambridge University Press, 1960), Chapter 2, "The Five Stages of Growth--A Summary," pp. 4-16

9 October--The World Systems Approach

Question: In What Specific Ways Does the World System Approach Differ from the Neo-liberal Approach?

Vincent Ferraro, "Dependency Theory: An Introduction," July 1996

Midterm Exam is due in class on 16 October. Please write an essay of no more than 8 pages critically assessing the following article: David Henderson, "Anti-Liberalism 2000," Wincott Lecture, 28 September 2000.

Mr Henderson was the former Chief Economist for the Organisation for Economic Development and Cooperation. His essay is a spirited defense of economic liberalism, and he makes an argument against what he calls the "new millennium collectivism."

It makes no difference whether you agree or disagree with Mr. Henderson. You should assess his use of history, his use of evidence, and his interpretations of specific events. Indicate where you believe his interpretations are valid and explain why you find those parts persuasive. Also point out your disagreements with his analysis and the basis for your disagreements.

You have enough time to explore his many references. You should use that time to check his facts and his interpretations of those facts. Additionally, you should explore alternative explanations for his conclusions.

16 October--Globalization 3.0

Part 1: The Countermovement Collapses

Question: Did the Soviet Union Collapse Because Its System Failed or Because the Countermovement Was No Longer Necessary?

Excerpt from Robert Strayer, Why Did the Soviet Union Collapse?: Understanding Historical Change (New York: M.E. Sharpe, 1998), pp. 56-60

21 October

Part 2: Technology Accelerates the Process

Question: To What Extent are the Technological Changes of the late 20th Century a Direct Outgrowth of Liberal Institutions?

World Trade Organization, World Trade Report 2008, Part IIB, "Globalization and Trade," pp. 15-26

23 October

Part 3: China Joins the Global Economy

Question: How Should We Characterize the Chinese Economy: Neo-liberal or State Capitalist?

David Zweig, "China Joins the Global Economy - Part One: How bureaucratic barriers were breached with a policy of 'No flow, no dough'," YaleGlobal, 15 September 2003

Paul Krugman, "The great illusion," New York Times, 15 August 2008

28 October

Part 4: India Joins the Global Economy

Question: Is India a Liberal State?

Shankar Acharya, "Why did India reform?" February 24, 2004

30 October

The Success of Globalization: The Creation of Wealth

Question: In What Ways are Growth and Development Linked?

Levels of World Economic Performance, 1500-1992

Rainer Falk, "Spreading the Benefits of Globalisation," World Economy & Development in Brief, March 26, 2008

Ashley Seager, "Development: US fails to measure up on 'human index'," The Guardian, July 17, 2008

4 November

The Success of Globalization: The Reduction of Poverty

Question: Is Global Poverty Declining?

David Dollar and Aart Kraay, "Trade, Growth, and Poverty," Finance & Development, September 2001, Volume 38, Number 3

Branko Milanovic, "Why Did the Poorest Countries Fail to Catch Up?" Carnegie Papers, Number 62, November 2005

6 November

The Economic Dimension of Convergence: Incomes

Question: How Equal Should Global Incomes Be?

International Development Economics Associates, "Globalisation and Income Inequality: A Survey," 19 August 2002

Sandra Polaski, "U.S. Living Standards in an Era of Globalization," Carnegie Endowment for International Peace, July 2007

Jagdish N. Bhagwati, "Technology, not globalization, driving wages down," Financial Times, January 4, 2007

11 November

The Social Dimension of Convergence: Work Standards

Question: Are Global Work Standards Desirable?

Kimberly Ann Elliott and Richard B. Freeman, Can Labor Standards Improve Under Globalization?, Chapter 1, "Globalization vs. Labor Standards?" Washington, DC: Peterson Institute for International Economics, 2003

13 November

The Environmental Dimension of Convergence: How Clean is Clean?

Question: Should Global Interests Override National Political and Economic Objectives?

William Antholis, "Five 'Gs': Lessons For Governing Global Climate From World Trade," The Brookings Institution, June 2008

18 November

The Cultural Dimension of Convergence: Is a Global Culture Emerging?

Question: Should We Aspire to Universal Standards for Human Rights?

Mahmood Monshipouri, "Identity and Human Rights in the Age of Globalization: Emerging Challenges in the Muslim World," Zaman Online (Turkey), May 2, 2005

20 November

The Political Dimension of Convergence: Are Nation-States Obsolete?

Question: What are the Proper Roles for Nation-States in a Globalized Economy?

Benjamin R. Barber, "Shrunken Sovereign: Consumerism, Globalization, and American Emptiness," World Affairs, Spring 2008

Sovereign Wealth Funds, 2008

25 November

The Question of Governance: Has Political Power Been Privatized?

Question: Does the Concentration of Wealth Threaten the Liberal State?

David Rothkopf, "Superclass and the Inequity of Globalization," YaleGlobal, 14 May 2008

Catharin E. Dalpino, "Does Globalization Promote Democracy?: An early assessment," The Brookings Institution, Fall 2001

2 December

Is Globalization Inexorable?

Question: Can Globalization Be Stopped? Should It be Stopped?

Niall Ferguson, "Sinking Globalization," Foreign Affairs, March/April 2005

4 December

Question: Will Politics or Economics Define the Liberal Paradigm in the Future?

Francis Fukuyama, "They Can Only Go So Far: The world's bullies are throwing their weight around. But history isn't on their side," Washington Post, August 24, 2008

Michael Parenti, "Globalization and Democracy: Some Basics," CommonDreams, May 25, 2007

Robert B. Reich, "China: Capitalism Doesn't Require Democracy," CommonDreams, January 10, 2006

Andrew Leonard, "How Wall Street broke the free market," Salon, January 15, 2008

9 December

Question: Will a New Countermovement Arise?

The Economist, "Onwards and upwards:Why is the modern view of progress so impoverished?" December 17 2009

Dani Rodrik, "The Death of the Globalization Consensus," Policy Innovations, July 25, 2008

David E, Sanger, "Beyond the Trade Pact Collapse," New York Times, 3 August 2008

Dani Rodrik, "Don't cry for Doha," Asia Times, 22 August 2008

Jagdish Bhagwati, "The selfish hegemon must offer a New Deal on trade," Financial Times, 19 August 2008

11 December