GLOBAL POLITICAL ECONOMY THEORY AND PRACTICE Fifth Edition
Theodore H. Cohn Simon Fraser University
Boston Columbus Indianapolis New York San Franci...
GLOBAL POLITICAL ECONOMY THEORY AND PRACTICE Fifth Edition
Theodore H. Cohn Simon Fraser University
Boston Columbus Indianapolis New York San Francisco Upper Saddle River Amsterdam Cape Town Dubai London Madrid Milan Munich Paris Montreal Toronto Delhi Mexico City Sao Paulo Sydney Hong Kong Seoul Singapore Taipei Tokyo
BRIEF CONTENTS Preface xi Acronyms and Abbreviations xvii
PART 1 Introduction and Overview
1
Chapter 1
Introduction
2
Chapter 2
Managing the Global Economy Since World War II: The Institutional Framework 17
PART 2 Theoretical Perspectives
51
Chapter 3
The Realist Perspective
55
Chapter 4
The Liberal Perspective
77
Chapter 5
Critical Perspectives
103
PART 3 The Issue Areas 130 Chapter 6
International Monetary Relations
Chapter 7 Chapter 8
Global Trade Relations 167 Regionalism and the Global Trade Regime
Chapter 9
Multinational Corporations and Global Production 250
Chapter 10 International Development
131
296
Chapter 11 Foreign Debt and Financial Crises
341
PART 4 Concluding Comments 382 Chapter 12 Current Trends in the Global Political Economy 383 Glossary 409 Index 419
209
CONTENTS Preface xi Acronyms and Abbreviations
Part 1
xvii
Introduction and Overview
1
Chapter 1 Introduction 2 What is International Political Economy? 2 The IPE Theoretical Perspectives 4 Purposes and Themes of this Book 5 Focus of this Book 11 Questions 13 Further Reading Notes 14
13
Chapter 2 Managing the Global Economy Since World War I The Institutional Framework 17 T
Global Economic Relations Before World War II 18 The Functions of the IMF, World Bank, and GATT 22 International Economic Organizations and the United Nations 23 Postwar Economic Institutions and the North 23 Postwar Economic Institutions and the South 31 Postwar Economic Institutions and the Centrally Planned Economies 38 Nonstate Actors 42 Conclusion 43 Questions 44 Further Reading Notes 45
45
Part 2 Theoretical Perspectives
51
Chapter 3 The Realist Perspective 55 Basic Tenets of the Realist Perspective 56 The Mercantilists 58 Realism and the Industrial Revolution 58 Realism in the Interwar Period 59 Realism after World War II 60 vi
Contents The Revival of Realist IPE 60 Hegemonic Stability Theory and Debates over U.S. Hegemony 61 Realism and North-South Relations 68 Critique of the Realist Perspective 69 Questions 70 Further Reading 71 Notes 71
Chapter 4 The Liberal Perspective 77 Basic Tenets of the Liberal Perspective 77 Orthodox Liberalism 80 The Influence of John Maynard Keynes 81 Liberalism in the Postwar Period 82 A Return to Orthodox Liberalism 82 Liberalism and Institutions 84 Liberalism, Global Governance, and Regimes 89 Liberalism and Domestic-International Interactions 90 Liberalism and North-South Relations 92 Critique of the Liberal Perspective 94 Questions 96 Further Reading 96 Notes 97
Chapter 5 Critical Perspectives 103 Basic Tenets of Historical Materialism 103 Early Forms of Historical Materialism 106 Whither the Historical Materialist Perspective? 110 Constructivism 114 Feminism 116 Environmentalism 118 Critique of the Critical Perspectives 121 Questions 123 Further Reading 123 Notes 124
Part 3 The Issue Areas
130
Chapter 6 International Monetary Relations 131 The Balance of Payments 132 Government Response to a Balance-of-Payments Deficit 134
vii
viii
Contents
The Functions and Valuation of Money 138 International Monetary Relations Before Bretton Woods 138 The Formation of the Bretton Woods Monetary Regime 140 The International Monetary Fund 141 The Functioning of the Bretton Woods Monetary Regime 142 The Regime of Floating (or Flexible) Exchange Rates 148 Alternatives to the Current Monetary_Regime 150 European Monetary Relations 151 What is the Likely Future of the U.S. Dollar as the Key Currency? 153 Sovereign Wealth Funds 157 Considering IPE Theory and Practice 158 Questions 160 Further Reading 161 Notes 162
Chapter 7 Global Trade Relations 167 Trade Theory
168
Global Trade Relations Before World War II 172 GATT and the Postwar Global Trade Regime 173 Principles of the Global Trade Regime 174 Formation of the WTO 180 The WTO and the Global Trade Regime 184 The South and Global Trade Issues 185 The Transition Economies and Global Trade Relations Civil Society and Global Trade Relations 195 Trade and the Environment 196 Considering IPE Theory and Practice 199 Questions 201 Further Reading 201 Notes 202
190
Chapter 8 Regionalism and the Global Trade Regime 209 Regionalism and the IPE Theoretical Perspectives 211 Regionalism and Globalization 212 A Historical Overview of RTAs 213 Explanations for the Rise of Regional Integration
214
Contents The GATT/WTO and RTAs The European Union
218
222
The North American Free Trade Agreement Mercosur
229
234
East Asian Regionalism 236 Considering IPE Theory and Practice 239 Questions 241 Further Reading 242 Notes 242
Chapter 9 Multinational Corporations and Global Production 250 Definitions and Terminology 251 Why do Firms Become MNCs? 252 The Historical Development of FDI 254 MNC-Host Country Relations: Determinants and Effects of FDI 262 Host Country Policies Toward MNCs 265 MNC-Home Country Relations 269 A Regime for FDI: What is to be Regulated? 276 Bilateral Investment Treaties 277 United Nations 278 Regional Approaches: The EU and NAFTA 279 The GATT/WTO to the OECD and Back to the WTO 281 Private Actors 283 Considering IPE Theory and Practice 284 Questions 287 Further Reading Notes 288
287
Chapter 10 International Development
296
IPE Perspectives and North-South Relations 298 Official Development Assistance 299 The World BankGroup 303 LDC Development Strategies 308 Import Substitution Industrialization 309 Socialist Development Strategies 312 Export-Led G rowth 313 The Revival of Orthodox Liberalism
319
Another Shift in Development Strategy?
324
IX
x
Contents Considering IPE Theory and Practice
Questions 332 Further Reading Notes 334
330
333
Chapter 11 Foreign Debt and Financial Crises 341 What is a Debt Crisis? 341 The Origins of the 1980s Debt Crisis 343 The Foreign Debt Regime 348 Strategies to Deal with the 1980s Debt Crisis 355 Transition Economies and Foreign Debt 363 The IMF, World Bank, and the Debt Crisis 365 The 1990s Financial Crisis 367 The Global Financial Crisis—2008 to ? 371 Considering IPE Theory and Practice
Questions 375 Further Reading Notes 376
Part 4
373
375
Concluding Comments
382
Chapter 12 Current Trends in the Global Political Economy 383 Globalization 383 North-North Relations 394 North-South Relations 400 A Final Word on IPE Theory and Practice 404 /Votes 405 Glossary Index