The study of IPE was developed as a subfield of IR in the 1970s as a result of what two factors?
1. Global economic changes
2. New trends in theorizing
What is IP E / GPE? (2)
1. Subfield of IR which focuses on the private and public allocation of resources.
2. it analyzes economics and international relations.
What is the key element of IPE?
The interrelationship between power and the distribution and consumption of resources
What is the focus of realism and statist IPE?
Powerful states determine the nature and content of world economy
What is mercantalism?
A strand of realist IPE that focuses on the states internal role in the economy. It discourages imports through the imposition of tariffs, quotas and subsidies.
What is the basis of Marxist IPE ? (3)
1. The relations of production creates two classes, capitalists and workers.
2 workers work to preserve capitalism.
3. The logic of surplus value has a direct relationship with the logic of exploitation.
What is structuralism? (4 points)
1. A strand of Marxist IPE that focuses on the practices of MNC's and their relationship with states.
2. They believe that most of the world's economy is controlled by NMCs.
3. there is an emergence of a transnational capitalist class.
4. it seeks global justice.
What are the three key elements of liberal IPE?
1. That the invisible hand regulates economics and therefore States should not interfere
2. Ricardo's idea of comparative advantage for free trade
3. L'aissez-faire ideology of free trade promotes peaceful coexistence of states
What is globalization? 2 points
1. increased interdependence and interconnectedness between people from across the world
2. Political, cultural and social interconnectedness with the increasing movement of people across the globe
What is a global trade regime?
Rules and institutions aimed at reducing protectionism that are put in place by States. they remove tariffs and quotas.
What is the perceived benefits of the global trade regimes?
They reduce uncertainty and unpredictability in trade between states and non States
What are the three pillars of IPE that were instituted during the Bretton Woods conference ?
1. The World Bank
What is the WTO? (4)
1. An organization stablished from the concepts of the ITO in order to govern trade relationships between states.
2. It has a legal personality, it can sue and be sued
3. It has a dispute settlement mechanism
4. uses consensus decision-making and the rules that are made are binding upon States
What is GATT?
general agreement on tariffs and trade.
it is a multilateral agreement regulating international trade which consist of several rounds including the Uruguay Round between 1986 and 1994
What are three functions of the WTO?
1. The implementation of the Uruguay Round of trade agreements
2. It is a forum for further negotiations
3. Administrate trade disputes
What are the three pillars of the global economy today?
3. World Bank
What is the WTO's aid for trade?
A program to assist developing countries develop their economies.
What is controversial about aid for trade?
People say that the resources are being diverted from building schools and other important social infrastructure to projects that only benefit and menses in these countries
What are the four biggest trading countries in the world?
1. The United States
What is a globalist view concerning globalization? (4)
1. Creates freer international financial system
2. It enhances efficiency
3. It promotes growth
4. It expands trade in goods and services
What is a skeptic's view of globalization? (4)
1. Freer financial flows are difficult to control
2. It is very disruptive and undermines national autonomy / sovereignty
3. It discourages domestic savings
4. When one country sneezes, all other countries will catch a cold
How did the monetary system change after world war 2? (4)
1. formal multilateral financial institutions were established including the IMF and the World Bank
2. The US dollar becomes the world currency
3. In 1971 Richard Nixon decided to take the US dollar off the gold standard
4. Establishment of floating exchange rates by the IMF. now countries can determine the value of their own currencies
What is the IMF? (3)
1. An organization to promote global monetary and financial cooperation
2. It is designed to assist countries in financial trouble
3. Member counties contribute to the fund and it lends funds to countries with balance of payment difficulties
What is the World Bank?
An organization that provides long term loans to States for economic development
What was the key feature of the Bretton Woods arrangement? Explain
The establishment of embedded liberalism.
States can intervene in their own economies, but such intervention should not undermine liberalization
What led to the globalization of financial and private markets? (4)
1. The growth in global telecommunications
2. The expansion of international trade
3. The growth of MNC's
4. IMF and World Bank conditionality in the Global South whereby states are asked to cut jobs and reduce public expenditures so these countries are forced to borrow from private markets
What is a major problem with MNC's? (4)
1. they are able to evade taxation
2. They have the ability to move production to places where there are less environmental regulations and worker safety standards.
3. They are able to use triangulation in order to circumvent trade embargoes. example the goods are made in Cuba then sent to Vietnam for repackaging then shipped to the United States who had a trade embargo with Cuba.
4. They can impact state sovereignty and create conflicts between states
Which company produces more profits in one year than the GDP of Norway?