Thursday, March 30, 2006

More Notes on International Political Economy

Ruggie, John G. “Reconstituting the Global Public Domain – Issues, Actors and Practices” 2004.

“My aim in this article is to provide a more comprehensive set of lenses, drawing attention to the beginnings of a fundamental reconstitution of the global public domain—away from one that equated the ‘public’ in international politics with states and the interstate realm to one in which the very system of states is becoming embedded in a broader, albeit still thin and institutionalized arena…” (500).

“Not surprisingly, interest in the political significance of TNCs stayed alive and more recently has enjoyed a minor renaissance in the international relations literature inspired by the so-called critical theory” (502).

“Thus, Wapner’s notion of a ‘world civic politics’ associated with civil society organizations and Cutler’s concept of ‘private governance’ associated with transnational corporations are two of the building blocks of what I call the new global public domain…” (504).

“Although the new global public domain is hardly unchallenged, its emergence, like globalization, to which it is closely linked, is part of a broadening and deepening sociality at the global level” (504).

“States constituted the international ‘public’ – as in public international law and public international unions, the name given to 19th century international organizations” (505).

“The spatial map characteristic of the traditional international political world has undergone a major transformation over the past generation. Above all there has been a shift in the locus of issues on the global governance agenda along a set of axes depicting ‘external’, ‘internal’ and ‘universal’ dimensions of policy spaces” (507).

“A similar blurring of the two spheres has occurred as a result of the trade regime expanding horizontally to encompass entirely new dimensions that previously has not been associated with trade at all” (508).

“In short the spatial configuration of the global governance agenda has become far more open, fluid and tightly coupled across states than the baseline picture represented by figure 1” (509).

“[Non-state actors] include transnational corporations and financial institutions; civil society organizations; faith-based movements; private military contractors that in some respects resemble the mercenaries of yore; and such illicit entities as transnational terrorist and criminal networks’ (509-510).

“The rights of transnational corporations have expanded manifold over the past quarter century as a result of multilateral trade agreements, bilateral investment pacts, and domestic liberalization – often pushed by external actors, including states and the international financial institutions” (510).

“But the iconic case of civil society actions to redress imbalances in global rulemaking remains its role in defeating the Multilateral Agreement on Investment, strongly supported by TNCs and international business associations” (511).

“CSOs, in turn, have pushed for companies and industries to adopt verifiable measures to reduce the incidences of such behavior” (512).

“A third and very different rationale for targeting the transnational corporate sector has emerged in the past few years – the sheer fact that it has global reach and capacity, and that it is capable of making and implementing decisions at a pace that neither governments nor international agencies can match” (514).

“There is a certain moral and intellectual obtuseness to a position that considers people’s welfare to be an uninteresting concern for international relations theorizing, particularly at a time when the individual enjoys more extensive recognition in international politics and law than ever before” (519).

“Political leaders and international relations theorists alike ignore the emergence of the new global public domain at their peril. Without it, one cannot fully understand recent developments in human rights, environmental policy, global public health, changing social expectations regarding the role of corporations, and the normative context for considerations of the use of force – indeed, according to some scholars, even the fate of the Soviet Union and its empire” (521).

“But the resulting picture would show the progressive arrival on the global stage of a distinctive public domain – thinner, more partial, and more fragile than its domestic counterpart, to be sure, but existing and taking root apart from the sphere of interstate relations.

Rodrik, Dani. “Governance of Economic Globalization.” 2000.

“If it was the nineteenth century that unleashed capitalism in its full force, it was the twentieth century that tamed it and boosted its productivity by supplying the institutional underpinnings of market-based economics” (347).

“These institutional innovations greatly enhanced the efficiency and legitimacy of markets and in turn drew strength from the material advancement unleashed by market forces” (347).

“But globalization also undercuts the ability of nation-states to erect regulatory and redistributive institutions and does so at the same time that it increases the premium on solid national institutions” (348).

“The dilemma that we face as we enter the twenty-first century is that markets are striving to become global while the institutions needed to support them remain by and large national” (348).

“National borders seem to have a significantly depressing effect on commerce, even in the absence of formal tariff or nontariff barriers, linguistic or cultural differences, uncertainty about the exchange rate, and other economic obstacles” (349).

“The most obvious way we can attain such a world is by institutin federalism on a global scale. Global federalism would align jurisdictions with the market, and remove the “border” effects” (353).

“National governments would not necessarily disappear, but their powers would be severely circumscribed by supranational legislative, executive, and judicial authorities” (353).

“The price of maintaining national jurisdictional sovereignty while markets become international restricting politics to a narrow domain” (354).

“Hence for cooperation to be sustainable, the short-term benefits of defection must be small, the discount rate low, and the future benefits from cooperation high” (357).

“As long as nation-states remain at the core of the international system, considerations of sustainability and diversity require that the rule allow selective disengagement from multilateral disciplines” ( 361).

“Global federalism would not mean that the United Nations turns itself into a world government. What we would be likely to get is a combination of traditional forms of governance (an elected global legislative body)with regulatory institutions spanning multiple jurisdictions and accountable to perhaps multiple types of representative bodies’ (363).

Kahler, Miles and David A. Lake. “Globalization and Changing Patterns of Political Authority.” 2001.

“In contrast, we find the effects of globalization on governance to be more heterogeneous and contingent than the most vocal proponents and opponents claim” (412).

“Our evidence of evolutionary rather than revolutionary change does not mean that the state has been the locus of political activity within the international system, as realists expect” (414).

“In contrast to this emphasis on globalization as a competitive and unforgiving environment, the authors in the present volume emphasize the significant strategic choices that remain with political actors” (415).

“Although migration of governance may occur in any of these three directions, all point away from national governments” (416).

“Globalization may produce more heterogeneous preferences over policy and public goods in contrast to the conventional view that it induces homogeneity” (420).

“Globalization constrains the array of policy instruments available to states” (425).

“With the exception of the European Union, intergovernmental cooperation has produced little supranational regulation of international corporations” (425).

“Globalization produces better information about economic and political practices in other countries, lower transaction costs for organizing groups within and across borders, and a fledgling global civil society” (426).

“We challenge this view of convergence on two grounds. First, rather than inducing only conformity, the logic of globalization may also promote specialization and differentiation” (428).

“Second, the process of convergence or divergence is the product of highly strategic and political choices by national governments” (428).

“The relationship between sites of governance and accountability is subtle and deserves greater analysis. For example, throughout the debate over democratic deficits and accountability, one assumption is pervasive: governance is more accountable when it is closer to its principals, particularly electorates” (434).

Two conclusions: “Globalization defined as economic integration is not global. Integration remains uneven and spatially differentiated” (435).

“Second, globalization has affected national political authority, but its influence has seldom matched simple claims of diminished governance and the hollowing out of the state” (435).

Keohane, Robert and Joseph Nye. “Redefining Accountability for Global Governance” 2001.

“In the absence of a global political community (which is not imminent), it makes little sense to hold global institutions to domestic democratic standards” (388).

“The key to our analysis is the assertion that accountability can take multiple forms. Direct electoral representation is not the only relevant form for contemporary international governance…Accountability can be accomplished: by rules and regulations, markets and publicity” (388-389).

Five sets of processes that create accountability:

electoral accountability
hierarchical accountability
legal accountability
reputational accountability
market accountability

“Accountability is sometimes treated as a good, per se, but it is an instrumental value, subject to being traded off against other values” (391).

“But we have seen that, even within democratic countries, accountability is more varied than this description would imply” (393).

“It is better to devise pluralist forms of accountability than to bewail the democratic deficit” (393).

Governance can occur in a variety of ways:

statist governance
international-organization model of governance
transnational-actors model of governance
policy-networks model of governance

“Reality under conditions of complex interdependence blends all four abstract models that we have discussed above. The models we have sketched are useful for highlighting the features of actual regimes that are likely to generate certain types of accountability” (403).

“IO-based clubs were very convenient for officials negotiating agreements within issue-areas since they kept outsiders out” (404). IO-based clubs good for governance

“The key element that is missing from both the IO-based clubs and from expanded issue-networks is the presence of intermediating politicians, communicating both with each other and with their publics” (408).

“If we think clearly about the forms of accountability than traditional electoral accountability, we may be able to design international institutions that meet our needs for effective cooperation without handing our fates over to unelected technocrats” (409).

“Global governance today lacks a sufficient role for politicians, intermediating between policy and publics” (410).

Richards, John. “Toward a Positive Theory of International Insitutions: Regulating International Aviation Markets.” 1999.

“The rapid growth in global trade in recent decades poses major analytic issues for our understanding of the international institutions and agreements underlying this expansion” (1).

“International aviation markets provide a rich example for making sense of these questions. In the aftermath of World War II, states created a complicated set of multilateral and bilateral rules that successfully restricted supply” (1).

“We need to understand why states created a cartel after World War II and why it began to crumble in the late 1970s, the nature of the forces that are currently driving efforts at restructuring international aviation markets, and the reasons for successful reform efforts in some markets and failure in others” (2).

His argument: “Put simply, national politicians create and maintain international institutions to maximize domestic political support” (2).

“This is particularly true since national politicians can use international institutions to assign property rights in international markets, increase the efficiency of these markets, and thereby increase the amount of wealth available for domestic redistribution” (2).

“In summary, the potential for domestic political gains from international institution building, not increased economic efficiency through the provision of public goods, leads reelection-seeking national governments to create and maintain international institutions” (2).

Two important conclusions: a) the model shows that even economically inefficient international institutions can be winning political solutions for national politicians; b) the model shows how states with market power define the status quo ex post (the reversion point) can use international institutions to transfer wealth from foreign states to their own domestic constituents (3).

“To summarize, both collective goods and distributional approaches highlight important aspects of international institutions, but are ultimately incomplete. Collective goods approaches are correct to note that international institutions often generate efficiency gains in international markets. But these analyses focus solely on the demand for institutions and have been rightly criticized for their failure to pay attention to the distributional effects of international institutions” (8).

“The starting point of my argument is that international institutions are fundamentally regulatory institutions that define property rights in international markets and thereby set the rules governing international markets and thereby set the rules governing international economic exchange” (9).

“The market for international regulation functions just like its domestic counterpart: constituents demand regulation up to the point at which the marginal cost of their efforts equals the expected marginal benefits of regulation, and politicians supply regulation up to the point at which the votes gained due to regulation equal the votes lost” (9).

Two assumptions: politicians maximize their political support defined in terms of votes; b) constituents seek regulation through two avenues: votes and campaign contribution (10).

“The first way national politicians can use international regulations to increase the amount of resources available for domestic redistribution stems from the role of international institutions in assigning property rights in international markets and thereby increasing the resources available for domestic redistribution” (11).

“The second way national politicians can use international institutions to increase resources for domestic redistribution revolves around the transfer of wealth from foreign partners to domestic interests” (12).

“To summarize, national governments use international institutions to increase the amount of wealth available for domestic redistribution” (13).

“With its airlines left unscathed by the war and controlling 72 percent of world air traffic, the United States wanted competitive international markets and extensive rights to take advantage of clear market superiority” (16).

“With international liberalization promising to increase the wealth available for domestic redistribution, U.S. national politicians sought to export domestic deregulation in the late 1970s” (22).

“Like other aspects of the Thatcher revolution, aviation liberalization promised to provide more services at lower prices to consumer and businesses in the United Kingdom” (28).

“The deregulation of postwar international aviation markets suggests that existing approaches to international institutions fail to capture important elements of international institution building” (31).

Fioretos, Orfeo. “The Domestic Sources of Multilateral Preferences: Varieties of Capitalism in the European Community” 2001.

“Explaining why – rather than how – individual member-states agreed to the TEU, particularly their preferences over the shape of the first pillar concerning economic cooperation, takes us away from the traditional emphasis on intergovernmental bargaining in studies of European integration and leads us to consider more seriously the domestic bases for a member’s decisions” (214).

“In such an organization, the nature of states’ national preferences thus becomes a key determinant in defining the shape of common multilateral institutions” (214).

“The central proposition advanced in this chapter may be stated simply: the shape of multilateralism on the ability of that country to sustain the comparative institutional advantages provided by its specific variety of capitalism” (215).

“Realism explains states’ support for European integration as a function of their efforts to improve security and to enhance their relative positions vis-a-vis competitors in other economic regions such as East Asia and North America” (216).

“The focus on the process that leads states to adopt specific preferences is both appropriate and important since it “is analytically prior to both realism and institutionalism because it defines the conditions under which their assumptions hold” (217).

“The varieties of capitalism approach that informs this volume starts from the premises that countries exhibit distinct, historically determined, national institutional equilibria that tie together a number of building blocks in a coherent fashion that defines particular and differentiated market economies” (219).

“As such, and in contrast to the theoretical traditions reviewed earlier, the varieties approach endogenizes agents’ preferences” (220).

Britain: uncoordinated, deregulated market model
Germany: coordinated market economy

“Because of the structural disparities in the two countries, producers are provided with different institutional advantages that bias them toward adopting distinct product market strategies” (221).

“The following pages suggest that attention to how common European regulatory frameworks affect the institutional equilibrium of national market economies allows us to uncover why interest groups and governments prefer particular forms of European multilateralism” (223).

“In brief, the EC should not only be seen as an institutional constraint on member-states, but also as an organization that presents opportunities for institutional reforms that may be difficult to achieve on a purely national scale” (224).

“The dependence of British manufacturers on a low-cost and deregulated business environment gave the British government a strong incentive to ensure that EC-level agreements did not impose high social regulations that would undermine the rationale of its ‘Enterprise Centre of Europe’ strategy” (230).

“However, if the view of Britian as always reluctant to increased European integration is an exaggeration, then the claim that Germany is always a champion of integration is no less an overstatement” (233).

“On the issue of a European industrial policy, the outcome at Maastricht and the language in Article 130 corresponded closely to the German national preference – roughly between the British minimalist and the French maximalist positions” (237).

“One of the strengths of the varieties of capitalism approach is that unlike many theories in IR, it endogenizes actors’ preferences and does not assume that actors have static preferences over time or issue areas” (240).

“…existing national institutions shape the institutional preferences of economic agents in distinct ways, and European institutions provide opportunities to solidify desired outcomes: (243).

Milner, Helen. “Interests, Institutions and Information.” 1997.

“This book argues that domestic politics and international relations are inextricably interrelated” (3).

“Both scholars and policy makers will overlook key elements explaining a country’s behavior if they fail to consider its domestic situation” (3).

“The new metaphor prompts a change in the designation of the actors. No longer are states the actors; rather, central decision makers, legislatures and domestic groups become the agents” (4).

“The method chosen to do so is rational choice theory” (5).

“Obviously if one rejects the basic assumption that agents are, at times and to some extent as least, rational – that is, they pursue goals and try to achieve them in the most efficient manner – then even these attempts to deal with the potential problems of the rational choice approach will be of little avail” (5).

“Questions about international cooperation are salient, and their answers are not obvious because of the dominant theoretical baseline used to explain international politics” (6).

“The central empirical issue is to explain the likelihood and terms of cooperation among nations” (7).

“My central argument is that cooperation among nations is affected less by fears of other countries relative gains or cheating that it is by the domestic distributional consequences of cooperative endeavors. Cooperative agreements create winners and losers domestically; therefore they generate supporters and opponents” (9).

Polyarchy for Milner: “No single group sits at the top; power or authority over decision making is shared, often unequally. Relations among groups in polyarchy entail reciprocal influence and or the parceling out of distinct powers among groups” (11).

Polyarchy continuum entails:


“Domestic politics is rarely a pure hierarchy with a unitary decision maker, even in nondemocratic systems” (12).

“Domestic politics matters because the state is not a unitary actor. Groups within it have different policy preferences because they are differentially affected by government policies” (16).

Preference argument is different because:

treats societal and political preferences as both influential
preferences do not translate directly into policy

“The political institutions in which I am interested are those that determine how policy is chosen; they refer broadly to the legislative process” (18).

Information treated as:

a variable
solution depends on informed interest groups
distribution depends on the structure of preferences (23).

Frieden, Jeffrey. “Invested Interests: the Politics of National Economic Policies in a World of Global Finance.” 1991.

“A striking characteristic of the contemporary international economy is the great mobility of capital across national borders” (425).

“This article proposes a framework for analyzing politics of international capital mobility. It focuses of the distributional implications of cross-border capital movements and on the distributional implications of various economic policies in light of the high degree of international capital mobility” (426).

“In this context, foreseeable levels of international capital mobility restrict but do not eliminate the possibility for national economic policies. Sectoral policies remain feasible, as do policies whose goals directly or indirectly involve the exchange rate” (426).

“…International capital mobility tends to remake political coalitions by way of its impact on the effect of national policies” (426).

“The relationship between international capital mobility and national policies is a prominent example of the much-discussed impact of external conditions on domestic politics” (427).

“The initial question therefore concerns the degree to which national economic policy autonomy is compromised by existing levels of international capital mobility” (427).

“Economic studies have consistently shown that borders and currencies are still substantial barriers to investment flows” (428).

Why international investment is not a seamless web”

a) Investors must take into account the possibility that assets in one country may be riskier than those in another country and that movements in exchange rates may affect the return on their investments.
b) Most assertions of full international capital mobility refer to international transfers of financial assets, especially bonds and bank claims.

“All in all however, increased financial capital mobility probably has little effect on most sector-specific policies. Supporters of such policies can generally design them to avoid their frustration by financial flows, domestic or international” (430).

“On the other hand, integration of financial markets has significant effects on the effectiveness and the differential distributional impact of national macroeconomic policies” (430).

Mundell-Flemming approach: at most, a country can have two of the three following conditions; a fixed exchange rate, monetary policy autonomy, and capital mobility (431).

“…if capital moves freely across borders, bonds floated to finance increased governmental spending are bought by international investors, and there is no effect on interest rates, which are set globally” (432).

“The general point is that in a world of fully mobile capital, national policy cannot affect the national interest rate; it can, however, affect the exchange rate” (432).

“It can hardly be bad for capitalists to have more investment options than before, which is what capital mobility gives them. By the same token, increasing the options of capital presumably reduces those of labor by making it less costly for capital to move rather than accede to labor demands” (434).

Heckscher-Ohlin model: “the effects of goods movements on returns to factors will vary according to whether the factors are locally scarce of abundant” (435).

“We can also introduce another important set of economic actors: internationally diversified (multinational) corporations. In the specific-factors view of the world, a crucial dimension of variation is the mobility or specificity of an asset, be it an investment, skill, or plot of land” (439).

“The openings of global financial markets to the less developed countries (LDCs) was good for industries in the Third World, which were suddenly able to borrow at reduced rates of interest” (440).

“In the United States, support for financial deregulation, including deregulation of international financial relations, has come primarily from the country’s financial centers and its internationally oriented nonfinancial corporations: domestic manufacturing and farm groups have been ambivalent or hostile” (441).

“While the political divisions likely to emerge over the desired degree of international financial integration are important, the general increase in international capital mobility is also likely to change interest group activity on a wide range of other economic policy problems” (442).

“If indeed international financial integration does reduce barriers to entry and exit of investors to a from specific activities, it could reduce the sectoral orientation of lobbying by investors” (443).

“Recall that, with capital mobility, a country faces something of a tradeoff between exchange rate stability and monetary policy autonomy…” (444).

Look at two-by-two graph on page 445.

“These varying exchange rate preferences in turn affect preferences toward different macroeconomic policies. With capital mobility, an expansionary monetary policy leads to depreciation of the currency, while an expansionary fiscal policy leads to appreciation” (448).

“Hampered as national governments may be or appear to be in the face of an internationally integrated financial system, they continue to have weapons in their policy arsenal” (451).

Rogowski, Ronald. “Political Cleavages and Changing Exposure to Trade” 1987

“I want to suggest the relevance of a factor that has, until now, been widely neglected: externally induced changes – in countries with different factor endowments – in exposure to international trade” (1121).

“I shall try to show that basic results of the theory of international trade – including, in particular, the well-known Stolper-Samuelson theorem – imply that increases or decreases in the costs and difficulty of international trade should powerfully affect domestic political cleavages and should do so differently, but predictably, in countries with different factor endowments” (1122).

“I shall suggest that these implications conform surprisingly well with what has been observed about patterns of cleavage and about changes in those patterns in a great variety of countries during four periods of global change…” (1122).

Stolper-Samuelson: “showed that in any society protection benefits – and liberalization of trade harms – owners of factors, in which that society is poorly endowed, relative to the rest of the world, as well as producers who use the scarce factors intensively. Conversely, protection harms – and liberalization benefits – owners of factors the given society holds abundantly relative to the rest of the world, and producers who use the abundant factors intensively” (1122).

Rogowski’s assumptions:

a) the beneficiaries of a change will try to continue and accelerate it, while the victims of the same change will endeavor to retard of to halt it
b) those whole enjoy a sudden increase in (actual or potential) wealth and income will thereby be enabled to expand their political influence as well

“…Increasing exposure to trade must result in urban-rural conflict in two kinds of economies and in class conflict in the two others” (1123).

Review two-by two box on page 1124

“Germany and the United States were both still relatively backward, that is, capital-poor, societies: both, in fact, imported considerable amounts of capital in this period” (1124).

“Power and policy, we expect, will shift in each case toward the owners and intensive users of scarce factors” (1126).

Gerschenkron: “Where land is abundant, and labor scarce – as has generally been true of the Americas – ‘late’ economic modernization radicalizes owners of land rather than owners of labor” (1130).

“Simply out, socialism develops most readily where labor is favored by rising exposure to trade and capital is not; labor is then progressive and capital is reactionary” (1130).

Three possible objections:

it may be argued that the effects sketched out here will not obtain in countries that depend only slightly on trade
one can ask why the cleavages are likely to persist
His answer: trade fluctuates so rapidly as to frustrate rational expectations;
it may be objected that I have said nothing about the outcome of these conflicts
“What I have advanced here is a speculation about cleavages, not about outcomes.”

Gourevitch, Peter

“First, in using domestic structure as a variable in explaining foreign policy, we must explore the extent to which that structure itself derives from the exigencies of the international system” (882).

“Second, in using domestic structure as variable for explaining foreign policy, much of the literature is ‘apolitical’” (882).

“Finally, in exploring the links between domestic and international politics much of the literature argues that a break with the past has occurred such that the present character of the interaction represents a discontinuity which requires new categories of analysis” (882).

“Two aspects of the international system have powerful effects upon the character of domestic regimes: the distribution of power among states, or the international state system; and the distribution of economic activity and wealth, or the international economy” (883).

“The role of ideas requires careful consideration, but for reasons of space and mental economy, I shall limit my discussion to the international state system and the international economy” (883).

Outcomes: a) regime type; b) coalition pattern

“Regime type and coalition pattern are the properties of a political system most often used as a variable for the explanation of foreign policy” (883).

“In all these countries, what we now call transnational actors were certainly present (at least in some sense of that term): British investors, German steel manufacturers, French engineers, American missionaries.” (884).

Four perspectives on international-domestic relations:

a) Gerschenkron’s view of the “late industrializers,” or the late development school
b) Dependency school
c) Liberal development school…”The presence of new technology and competition is an advantage, as it allows the latecomers to benefit from the skills and surplus of their predecessors” (891-892).
d) TNAs…”The roots of this outlook in the criticism of the ‘realist’ paradigm are well known. In the mid-sixties the critique of realism centered on its view of the state as a unitary actor” (892).

“Complex interdependence alters domestic structures because it entails shifts in power away from certain governmental institutions toward other ones, or even shifts outside the government to private actors, or to international actors , or other foreign actors” (893).

Neo-merchantilists and state-centered Marxists

a) Robert Gilpin’s neo-merchatalist view
b) Marxist approach

“The anarchy of the international environment poses a threat to states within it: the threat of being conquered , occupied, annihilated or made subservient” (896).

“The line of argument to which I refer is that which uses as a major explanatory variable state strength (strong states vs. weak states; or state-centered policy networks) (901).

“In societies with weak states (or society-centered policy networks) policy-formation corresponds to a model of pluralistic government: social forces are well-organized and robust” (902).

“Structure affects the extent to which a governing coalition must make side-payments to build up its strength, the extent to which it can impose its views. It affects the possibility of realizing certain policies” (904).

“In other respects, the present is not so different from the past. Despite interdependence, the state retains its ability to control transnational actors, if it is able to muster the political support for doing so” (909).

Interdependence school: “the central concern appears to be with the dangers of anarchy: one might say that they reject the relevance of anarchy because they fear it” (910).

Dependency school: “the central concern appears to be the dangers of interdependence in its capitalist embodiment. They reject it because it is seen as incompatible with socialism” (910).

“The international system is not only a consequence of domestic politics and structures but a cause of them” (911).

Frieden, Jeffrey. “Actors and Preferences in International Relations” 1999.

“Preferences must be kept separate from other things – most important, from characteristic of the strategic setting” (39).

“Second, scholars need to be explicit about how they determine the preferences of relevant social actors. Whether preferences are variables of interest or control variables, it is essential that they be derived clearly and unambiguously” (39).

“The issue is especially important because although preferences are part of all explanation, they are not directly observable” (40).

“The essential point is that in any given setting, an actor prefers some outcomes to others and pursues a strategy to achieve its most preferred possibly outcome” (41).

“An actor’s preferences are the way it orders the possible outcomes of an interaction. If, as in most instances of interest to us here, the environment is one of strategic interaction, this involves ranking the terminal nodes of a game tree” (42).

“Within a particular box, political scientists are not usually interested in the preferences themselves but rather in how these preferences affect choices” (44).

“States, groups, or individuals require ways to obtain their goals, paths to their preferences” (45).

“The direct unobservability of preferences has its parallel with regard to strategies. It is never inherently obvious whether action is the result of preferences or strategies, underlying interests, or the environment in which they play themselves out” (46).

Sins of confusion: mixes preferences and the strategic setting in ways that do not allow their independent effects to be examined (49).

“…Power maximization is not a preference but a strategy. This means that state preferences are not defined by realists, which makes their analysis inherently incomplete” (50).

Sins of omission: is to assert that variation in outcomes is solely owing to variation in preferences; arise when analysts observe an outcome and draw a direct line form it back to the preferences of actors (51).

“A common variant of this lapse is to explain changes in interstate reactions simply by asserting that national preferences changed” (52).

“Scholars typically specify preferences in one of three ways: by assumption, by observation, and by deduction” (53).

Hiscox, Michael. “Class Versus Industry Cleavages” 2001.

“The results indicate that broad class-based conflict is more likely when levels of factor mobility are relatively high, and narrow industry-based conflict is more likely when levels of factor mobility are relatively high, and narrow industry-based conflict is more likely when levels of mobility are relatively low” (3).

“They suggest that the types of political coalitions that take shape in society and organize to influence economic policymaking largely depend on one basic feature of the economic environment that may vary over time and across nations: the extent to which factors of production are mobile between industries” (34).

“But the evidence presented here suggests that cleavages are powerfully shaped by economic forces” (35-36).

Becker, Gary S. “The Economic Way of Looking At Life” 1992

“My research uses the economic approach to analyze social issues that range beyond those usually considered by economists” (38).

“Unlike Marxian analysis, the economic approach I refer to does not assume that individuals are motivated solely by selfishness or gain. It is a method of analysis, not an assumption about particular motivations” (38).

“This analysis assumes that individuals maximize welfare as they conceive it, whether they be selfish, altruistic, loyal, spiteful or masochistic” (38).

“Employees may refuse to work under a woman or a black even when they are well paid to do so, or a customer may prefer not to deal with a black care salesman” (39). Opposite of Milton Friedman

“I spent several years working out a theory of how actual discrimination in earnings and employment is determined by tastes for discrimination, along with degree of competition in labor and product markets, the distribution of discrimination coefficients among members of the majority group, the access of minorities to education and training, etc…” (39-40).

“Indeed, in a world with constant returns to scale in production, two segregated economies with the same distribution of skills would completely bypass discrimination and would have equal wages and equal returns to other resources…” (40).

“Of greater significance empirically is the long run discrimination by employees and customers, who are far more important sources of market discrimination than employers” (40).

“The frequency of their inspection of parked vehicles and the size of the penalty imposed on violators should depend on their estimates of the type of calculations potential violators like me would make” (41).

“I was not sympathetic to the assumption that criminals had radically different motivations from everyone else” (41).

“…Risk-preferring individuals are more deterred from crime by a higher probability of conviction that by severe punishments” (42).

“Human capital analysis starts with the assumption that individuals decide on their education, training, medical care and other additions to knowledge and health by weighing the benefits and costs” (43).

“By definition, firm-specific knowledge is useful on in the firms providing it, whereas general knowledge is useful also in other firms” (44).
“The point of departure of my work on the family is the assumption that when men and women decide to marry or have children or divorce, they attempt to maximize their utility by comparing benefits and costs” (46).

“For example, contrary to popular belief about divorce among the rich, the economic analysis of family decisions shows that wealthier couples are less likely to divorce than poorer couples. According to this theory, richer couples tend to gain a lot from remaining married, whereas many poorer couples do not” (46).

“Since the return from investing in a skill is greater when more time is spent utilizing the skill, a married couple could gain a lot from a sharp division of labor because the husband could specialize in some types of human capital and the wife in others” (48).

“Both the children and the parents would be better off if the parents agreed to invest more in the children in return for a commitment by the children to care for them when they need help” (49).

“Again, I am trying to model a common sense idea; namely, that the attitudes and values of adults are enormously influences by their childhood experiences” (49).

In terms of rationality: “It does not return the analysis to a narrow focus on self-interest, for it partially replaces altruism by feelings of guilt, obligation, anger and other attitudes usually neglected by models of rational behavior” (50).

A critique of some welfare-state policies: “ Parents help determine the values of children – including their feelings of obligation, duty and love – but what parents try to do can be greatly affected by public policies and changes in economic and social conditions” (51).

“Other changes in the modern world which have altered family values include increased geographical mobility, the greater wealth that comes with economic growth, better capital and insurance markets, higher divorce rates, smaller families, and publicly funded health care” (51).

“Among other things, critics deny that individuals act consistently over time, and question whether behavior is forward-looking, particularly in situations that differ significantly from those usually considered by economists – such as those involving criminal, addictive, family or political behavior” (52).

Milner, Helen “Rationalizing Politics: the Emerging Synthesis of International, American and Comparative Politics” 1998.

“The central paradigms of the field of international relations – realism and neoliberal institutionalism – have ignored a key aspect of international relations: domestic politics”

“…The spread of democratization – both its actual practice and claims for it – also seems to make an understanding of domestic politics a sine que non for IR if it is to have either predictive ability or policy relevance” (760).

“Integrating IR with comparative and American politics holds out the possibility that the field will acquire a better understanding of both the domestic and international institutions that affect world politics” (760).

“The rationalist institutionalist research agenda challenges two of the main assumptions in IR theory. A central assumption has been that states are unitary actors. Relaxing this assumption means bringing domestic politics back in” (761).

Second: “…Changing this assumption (that state are the most important) means focusing on a broader set of actors in international relations, including international institutions” (761).

“I argue that the spread of rationalist institutionalism is occurring along three dimensions: a) the nature of actors; b) the importance of institutions in situations of strategic interaction, and c) the methodology of noncooperative game theory” (761).

Alternative to state approach:

emphasizes the strategic interaction among parties within the state as well as between state and societal actors; and it enables the systematic analysis of policy outcomes among strategic agents as their institutional contexts and preferences change
the impact of the rules and norms that structure the environment of actors and shape how collective outcomes are reached has become a central focus of attention throughout political science…
within and across states, actors are now increasingly seen as playing strategic games in which they cannot make binding commitments

Reasons for autonomy of IR as distinct discipline:

the field is broader that mere political science. IR, it is claimed, is truly interdisciplinary
many scholars have felt that IR’s unique subject matter makes it best approachable as an autonomous field, a position that has had less beneficial effects (763).

“Despite many challenges, realism has remained the dominant paradigm in IR” (764).

IR in 1977 textbooks: “The key trends noted about these texts were the tendency to portray the world as centered around nation-states, the lack of attention to domestic politics, the relative neglect of international organizations, and the emphasis on conflict and force (as opposed to cooperation and bargaining)” (765).
“The major assumptions of realism then have cut off IR from important cross-currents in political science” (767).

“The issue posed then is not about the appropriate level of analysis, but about the appropriate designation of the actors or units” (768).

“But, as I argue in more detail later, the assumptions either that one group controls foreign policy or that all (important) domestic actors have the same preferences seem quite problematic” (769).

“In contrast to Moravcsik, who advocates a ‘liberal’ theory of IR based on preferences, the claim here is for a theoretical approach that includes both preferences and institutions” (772, in footnote 52).

“Domestic politics, and I would argue international politics as well, varies along a continuum from hierarchy to anarchy, with most politics resembling polyarchy, which lies in between these extremes” (774).

“Several factors are important in defining a state’s placement in the continuum: the policy preferences of domestic actors and the institutions for power sharing among them” (774).

“If a single actor controls all decision making, one is back to the unitary actor model where hierarchy prevails” (774).

“Even in nondemocratic systems domestic politics is rarely a pure hierarchy with a unitary decision maker” (775).

“In addition to strategic interaction domestically, rational institutionalism can be useful at the international level to make it strategic too” (778).

“Once on leaves the world of states as unitary actors, one can us the concepts and theories from American and comparative politics, some of which provide powerful, parsimonious tools for understanding strategic interaction in different institutional environments” (779).

“My claim is that ignoring international institutions is likely to limit our understanding of IR: furthermore, using a systematic rationalist approach may help in understanding the role they play” (780).

“Two steps need to be considered: more comparative analysis of institutions and greater concern with the democratization of international institutions” (780).

“If such institutions are to thrive, it seems likely that they will have to become more democratic. As the EU makes clear, one strong source of resistance to the growing role of international institutions is their lack of democracy” (782).
“Game theory is ideal for analyzing (strategic interaction) since it provides a “theory of interdependent decisions – when the decisions of two of more individuals jointly determine the outcome of a situation” (783).

“Institutions are not viewed as neutral arenas for cooperation, rather they are political means to realize one’s preferences” (784).

Friedan, Jeffrey and Lisa Martin. “International Political Economy: Global and Domestic Interactions.”

IPE: “We take the field to include all work for which international economic factors are an important cause or consequence” (118).

“This essay presents what we believe to be the consensus among political scientists with regard to the analysis of the politics of international economic relations” (118).

“The most challenging questions in IPE have to do with the interaction of domestic and international factors as they affect economic policies and outcomes” (119).

“Like all of IPE, the interaction of domestic and international conditions can be analyzed in terms of three factors: interests, institutions and information” (120).

“In addition to affecting domestic interests, the international economy might also affect domestic institutions, as by making a previously feasible policy difficult to sustain” (121).

“In all these approaches international factors affect national policy by way of their direct effect on the domestic political economy. This effect may take place by restricting the set of feasible policies, by constraining domestic institutions, by altering domestic information, or by changing the preferred policies…” (123).

Domestic informational models: “assumes that the legislature may not know precisely the content of a negotiated agreement, perhaps because legislators may not know just how any agreement will influence economic outcomes in their districts” (124).

Schelling conjecture: “pairs of democracies have more success in lowering barriers to trade than pairs that match a democracy with an autocracy” (125).

Stolper-Samuelson theorem: “predicts that factors of production that are scarce in a county will benefit from trade protection, so that labor in capital-rich countries and capital in labor-rich countries should be protectionist” (127).

“The basic determinant of preference intensities is the size of the stakes” (129).

“The interests, preference, intensity and organization of socioeconomic actors is only a starting point for the analysis of domestic constraints on foreign economic policy. These interests are mediated through domestic political institutions in ways that can fundamentally affect outcomes” (131).

“Institutions perform two general functions: aggregation and delegation” (132).

Types of institutions:

electoral institutions matter to the making of foreign economic policy because they affect the transmission of societal interests to politicians
legislative organization…affect foreign economic policymaking…the importance of agenda control, veto points and other interactions among policymaking institutions
bureaucratic institutions, especially patterns of delegation to bureaucratic and other agencies

“The analysis of international interaction centrally involves three elements: the indentification of state interests; the specification of the strategic setting; and the attention to the role of uncertainty, beliefs and ideals in explaining policy choice” (137).

“Greater attention to strategic interaction could inform empirical studies of the choice between trade competition and cooperation, including the choice to join and abide by trade agreements…” (141).

Kindleberger, Charles. “Dominance and Leadership in the International Economy.”

“Dominance was a concept introduced into economic discussion, especially French economic discussion, by Francois Peroux, professor of economics at the Colleg de France…” (243).

“One country, firm, or person dominated another when the other had to take account of what the first entity did, but the first could equally ignore the second” (243).

“For present purposes, however, it is enough to note that within a single country, many public goods are provided by the government through a budget, most private goods by the market” (243).

“Thus, vested interests whose benefits are sufficient to warrant exertion get a disproportionate share of the public goods they are interested in” (244).

“Leaders work for something called ‘leadership surplus.’ They compete with other potential leaders for ascendancy, and once in office maximize their surplus or profit by providing collective goods against taxes, donations or purchases promised in the election process” (245).

Each scholar, says Kindleberger, enlarged the scope to which government provided public goods. It thus led to an expanded role for government.

“I argue that for the world economy to be stable, it needs a stabilizer, some country that would undertake to provide a market for distress goods, a steady if not countercyclical flow of capital, and a rediscount mechanism for providing liquidity when the monetary system is frozen in panic” (247).

“There is a legitimate debate, perhaps, between French and American positions, whether the United States sought domination or was trying to provide the public good of world stability in the period after World War II” (247-248).

“Part of the world’s economic problem today is that the United States has resigned (or been discharged) as leader of the world economy, and there is no candidate willing and acceptable to take its place” (248).

“But my concern is with those instances where the abundance of free riders means that the public good is underproduced, and that there is neither domination nor self-abnegation in the interest of responsibility” (249).

“I do not believe in the notion that the extreme left, the extreme right, the power elite, the establishment, oil companies, professoriat, military-industrial complex and so on, can be regarded as single-decision-making units with detailed programs” (249).

“For as far ahead as today’s social scientists can see, I think it is necessary to organize the international community – both related to policy and economy alike – on the basis of leadership” (252).

“I conclude that the danger we face is not too much power in the international economy, but too little, not an excess of domination, but a superfluity of would-be free riders, unwilling to mind the store, and waiting for a storekeeper to appear” (253).

Conybeare, John. “Public Goods, Prisoner’s Dilemmas and the International Political Economy.”

“As a corollary, it may be shown that large powers should not necessarily prefer and open system, particularly in the context of the pure theory of trade which is often used to justify the hegemonic openness thesis” (6).

“This is the crux of the problem in applying public good theory to the idea of an open world trading system: free trade may be a prisoner’s dilemma, but is not typically a public good problem. The reason for this is that free trade exhibits excludability and rivalry, and is fundamentally a problem of predatory income transfers, whereas the public good situation centers on the problem of inducing free riders to contribute to the supply of the public good” (8).

“In conclusion, all large number public good games are likely to create prisoners’ dilemma outcome, but prisoners’ dilemma games need not involve public good characteristics, at least insofar as one is concerned with the primary goal desired by the parties to the game” (8).

“Public goods may be present in the free trade problem, but not in the way that the hegemonic stability model suggests” (9).

“First, a public good problem may occur where collective action is required for say retaliation on the part of a number of small powers against a larger power” (9).

“Second, there may be publicness in free trade as a multilateral system. Countries peripheral to the system might, by virtue of their small size or low levels of participation in the system, enjoy a free ride in the sense of being able to enjoy both the benefits of free trade while still imposing their own trade restrictions” (9).

“Third, international trade may involve goods which are themselves public” (9).

“Fourth, public goods may occur as side effects of free trade” (9).

“While free international capital flows are globally optimal, it may be in the interest of individual countries to impose restrictions where the private and social rate of returns on capital flows are not equal” (10).

“Since international trade is more likely to exhibit there prisoners’ dilemmas rather than public good characteristics, there is little rational economic incentive for large powers to perform the stabilizing function suggested by Kindleberger and others in the hegemonic stability thesis” (11).

“To the extent that hegemons have in some cases pushed for open systems, this may be because powerful states, though aware that their interests would be best served by monopolistic predation, also need to keep the rest of the world open, a task made very difficult when they keep their own tariffs high” (12).

“In summary it is not clear that hegemonic powers should choose free trade as a first best strategy” (13).

“There are at least three contextual and institutional factors which may prevent the development of a genuine prisoner’s dilemma outcome: pecuniary incentives for joint optimization, the absence of structural forces necessary for the prisoners’ dilemma outcome, and asymmetries of size among the players” (13).

“In summary, though we are more likely to see prisoners’ dilemma than public good games as a source of primary conflict in international trade, the probability of prisoners’ dilemma type conflicts may be reduced by the existence of gains from bribery, dynamic game structures and asymmetries of size” (19).

“Because free trade is not essentially a public good, we have theoretical problems in rationalizing the proposition that hegemonic powers will seek to enforce free trade as the first best policy” (20).

Krasner, Stephen. “State Power and the Structure of International Trade”

International economic structure: “These can be explained, albeit imperfectly, by a state-power theory: an approach that begins with the assumption that the structure of international trade is determined by the interests and power of states acting to maximize national goals” (317).

“The two major organizers of the structure of trade since the beginning of the nineteenth century, Great Britain and the United States, have both been prevented from making policy amendments in line with state interests by particular societal groups whose power had been enhanced by earlier state policies” (318).

“At least four major state interests affected by the structure of international trade can be identified. They are: political power, aggregate national income, economic growth, and social stability” (319).

“Only by maintaining its technological lead and continually developing new industries can even a very large state escape the undesired consequences of an entirely open economic system” (320).
“All that can confidently be said is that openness furthers the economic growth of small state and of large ones so long as they maintain their technological edge” (321).

“The hegemonic state will have a preference for an open structure, Such a structure increases its aggregate national income” (322).

“The size and economic robustness of the hegemonic state also enable it to provide the confidence necessary for a stable international monetary system, and its currency can offer the liquidity needed for an increasingly open system” (323).

“The degree of openness can be described both by the flow of goods and the policies that followed by states with respect to trade barriers and international payments” (323).

“Openness in the global economic system has in effect meant greater trade among the leading industrial states” (324).

“Since 1945, there have been seven rounds of multilateral tariff reductions” (326).

“There is a natural affinity for some states to trade with others because of geographical propinquity or comparative advantage” (329).

Periods of tariff levels, trade proportions and trade patterns:

Period 1: (1820-1879) increasing openness
Period 2: (1879-1900) modest closure
Period 3: (1900-1913) greater openness
Period 4: (1918-1939) closure
Period 5: (1945-1970) great openness

“The contention that hegemony leads to a more open trading structure is fairly well, but not perfectly, confirmed by the empirical evidence presented in the preceding sections” (335).

“As a state-power argument suggests, openness was only established within the geographical area where the rising economic hegemony was able to exercise its influence” (337).

“Systems are intiated and ended, not as a state-power theory would predict, by close assessments of the interests of the state at a every given moment, but by external events – usually cataclysmic ones” (341).

“Once policies have been adopted, they are pursued until a new crisis demonstrates that they are no longer feasible. States become locked in by the impact of prior choices on their domestic political structures” (341). Key point!

“…Earlier policies in the United States begat social structures and institutional arrangements that trammeled state policy. After protecting import-competing industries for a century, the United States was unable in the 1920s to opt for more open policies , even though state interests would have been furthered thereby” (342).

“Having taken the critical decisions that created an open system after 1945, the American Government is unlikely to change its policy until it confronts some external event that it cannot control, such as world-wide deflation, drought in the great plains, or the malicious use of petrodollars” (343).

Barnett, Michael and Martha Finnemore. “Rules for the World.” 2004.

“Our goal in writing this book is to understand why IOs behave as they do” (2).

“This functionalism is only an assumption of these theories, though, and tends to focus scholars’ attention on why states create IOs to fulfill certain functions rather than on whether, in fact subsequent IO behavior is a functional as assumed” (2).

“IOs often produce inefficient, self-defeating outcomes and turn their backs on those whom they are supposed to serve. We want to know why” (2).

“Organizations adapt to changing circumstances in unanticipated ways and adopt new routines and functions without getting approval from their ‘stakeholders’”(2).

“In this book we develop a constructivist approach to understanding IO behavior that provides a theoretical basis for treating IOs as autonomous acpropensity toward dysfunctional, even pathological, behavior, and the way they change over time” (2-3).

“…IOs are bureaucracies. Bureaucracy is a distinctive social form of authority with its own internal logic and behavioral proclivities. It is because of their authority that bureaucracies have autonomy and the ability to change the world around them” (3).

“They then use the rules not only to regulate but also to constitute and construct the social world” (3).

“We need to understand how and why IO preferences diverge from state preferences, not just empirically but also theoretically” (4).

“IOs can have authority both because of the missions they pursue and because of the ways they pursue them” (5).

“Their means, like their missions, give IOs authority to act where individual states may not” (5).

“IOs exercise power as they use their knowledge and authority not only to regulate what currently exists but also to constitute the world, crating new interests, actors and social activities” (7).

“IOs are often the actors to whome we defer when it comes to defining meanings, norms of good behavior, the nature of social actors, and categories of legitimate social action in the world” (7).

“We call ‘pathologies’ those dysfunctions that are attributable to bureaucratic culture and internal bureaucratic processes and that lead the IO to act in a manner that subverts its self-professed goals” (8).

IOs: “They define problems and appropriate solutions in ways that favor more technocratic impartial action, which, of course they are uniquely able to supply” (9).

“…by contrast, we understand autonomy to exist when IOs are able to act in ways not dictated by states, we capture the range of activity not well explained by statist arguments and can provide a fuller argument” (10).

“IOs are not simply passive servants of states. They are political actors in their own right, having their own particular resources for shaping political action, and both shaping and being shaped by others” (12).

Parsons, Craig. “Showing Ideas as Causes: the Origins of the European Union” 2002.

“Within vague structural and institutional pressures, only certain ideas led Europeans to the EEC rather than to less extensive cooperation in much weaker international institutions” (47).

Two major obstacles: 1) showing ideas as causes; 2) historical arguments require extensive, detailed research (48).

“I argue that certain conditions allow for more concrete and specific claims about ideas. Where ideas strongly cross-cut lines of shared material interests in a polity, we can isolate individuals beliefs most clearly from objective pressures” (48).

“Ideas are subjective claims about descriptions of the world, causal relationships, or the normative legitimacy of certain actions. The basic reasons to suspect that ideas influence behavior have been well elaborated by the overlapping ‘constructivist’ and ‘sociological institutionalist’ schools in international relations and by comparative political scientists” (48-49).

“What was the range of possibilities without these ideas? Cross-case comparisons help in this respect, suggesting alternatives in similar situations” (50).

“Settings where ideas cross-cut prevailing lines of organization can clearly display their causal impact” (50).

“Cross-cutting ideas have particularly clear effects because they offer the sharpest possible contrast to the expectations of objective-interest theorists” (50).

“If, in addition, we have the kind of interpretive evidence typically offered by ideational accounts – actors consistently say and write that they believe certain things, and that their peers think differently – we have strong evidence that ideas alone are causing individual variation across that range” (51).

“Unlike in most ideational arguments, it is the actors, not the observer, who define the range across which ideas matter” (51).

“Experts agree that French choices were particularly important to the EEC’s birth” (54).

“In sum, no one contests that without French insistence on institutionally strong, geographically limited institution building in the 1950s no such framework would have resulted” (54).

“First, I do not claim that ideas ‘mattered more’ than other causes. Causality cannot be allocated meaningfully in percentage terms. Instead my answer to the ‘how much’ question specifies the range of historical outcomes dictated by each cause” (56).

“Second, French choices were necessary but not sufficient causes of European outcomes” (56).

“Third, my evidence is largely qualitative” (56).

Three French perspectives: realist; confederal, supranational (57-58).

“For Raymond Aron, France’s pursuit and then rejection of the EDC animated ‘the greatest ideological and political debate France has known since the Dreyfus affair” (62).

“All three strategies were viable internationally. The community option led to the EDC treaty in May 1953. It was ratified by the other ECSC members and supported by the United States…” (63).

“Massive interpretive evidence corroborates the pattern of cross-cutting mobilization: the actors uniformly described their debates as ideological” (65).

“In sum the EEC survived traditional French leadership in the 1960s not because of structural trends but despite them” (75).

“In France, actors who shared objective positions in parties, bureaucracies and sectors consistently espoused different ideas about how those interests connected to European institutional building” (76).

Weaver, Catherine. “The Social Construction of Good Governance.” 2005.

“Good governance is the key to holding corrupt and inefficient governments accountable for their actions” (1).

“Given the bank’s position as intellectual and financial leader in the development community, this apparent paradigm shift matters in understanding broader trends in the international development regime” (1)

“I argue that an explanation of why and how the World Bank adopted the good governance agenda requires a constructivist approach” (2).

“However, the real impetus for the paradigm shift appears to stem from internal learning and advocacy by a small group of Bank staff members” (3).

“In essence, I argue that the evolution of good governance in the Bank is best characterized as a ‘battle of ideas’ within the organization” (3).

“Governance advocates eventually had to strategically frame governance issues in a language, methodology and theoretical framework that did not directly challenge or delegitimize prevailing ideologies and practices” (4).

“Later, in 1996, the Bank published its hallmark World Development Report on the theme of the transition from plan to market, emphasizing the need for clear property rights, a ‘market-friendly’ legal system and deeper institutional reforms in the banking and financial sectors” (8).

“This view of the state playing a benign governance role in the market coincided with the Bank’s observations on the tremendous economic growth of East Asia form the mid-1980s through the mid-1990s” (9).

“In a greater departure from Bank ideology and practice, the report advocated political pluralism, the rule of law, and the protection of human rights to be key to the effective use of aid and socioeconomic development” (15).

“In 1997, governance appeared to be fully institutionalized in the Bank’s internal hierarchy. As part of another massive reorganization of the Bank’s management structure, a thematic group on poverty reduction and economic management was created and endowed with a number of staff keenly interested in governance issues” (21).

“Indeed, until quite recently, the number of social scientists within the bank has been extremely low in comparison to economists, engineers and business and finance specialists” (26).

“In the past dew years, World Bank publications have openly admitted that governance reform projects have seriously challenged the organization’s conventional way of conducting aid business” (30).

“The constructivist account of the evolution of the Bank’s good governance agenda provides strong reason to remain skeptical about the extent to which governance ideas have truly transformed the way the bank think about and pursues development” (32).

Macnamara, Kathleen. “The Currency of Ideas.”

“The key to solving the puzzle of European monetary cooperation lies in the historic economic policy convergence that occurred across the majority of the European governments beginning in the mid-1970s and solidifying in the 1980s” (3).

“Ideas are defined here as shared causal beliefs. Political actors use these ideas to evaluate the costs and benefits of monetary cooperation and chart a policy strategy” (5).

“In brief, European governments’ experience with macroeconomic policy failure in the aftermath of the first oil crisis spurred a search for alternatives to traditional Keynesian policies” (5).

“In arguing that the structure of the international economy shapes the terrain within which politics unfold but that the interpretation of that structure, or ideational processes, dictate the crucial choice of policy content and form…” (6).

“My findings on European monetary integration indicate that uncertainty creates highly fluid conceptions of interest, both national and societal” (7-8).

“In sum, my goal in this book is thus not to separate ideas and interests as competing causal factors but to show the inherent connections between the two” (8).

“I reject a deterministic view of the forces of international capital in favor of the argument that the process of interest redefinition has historically been dependent of policymakers shared beliefs” (8).

“At its heart, this new norm of competitive liberalism is rooted in the view that improvement in the international economic position of the nation state warrants taking harsh steps to adjust to changing international market conditions” (10).

“The Holy Trinity holds that policy makers can choose only two out of three policy options at any one time: free capital flows, a fixed exchange rate, and monetary policy autonomy” (44).

“Finally, capital controls may be opposed because they run directly counter to the ideology of neoliberalism” (52).

“Ideas are critical in the monetary realm because of continuing uncertainty over the basic workings of the macroeconomy, the difficulties of collecting and interpreting signals for macroeconomic date about the effects of policy, and the lack of agreement over what constitutes ‘correct’ macroeconomic policy” (57).

“The neoliberal policy consensus at the core of this shift was critically important to the maintenance of the EMS, given the increasingly high level of capital mobility, it also formed an important basis for the subsequent revival of the EMU project” (62).

“It is important to note, however, that the governments of Europe followed a pragmatic, not ideologically purist, type of monetarism” (67).