Hostname: page-component-586b7cd67f-gb8f7 Total loading time: 0 Render date: 2024-11-27T21:17:55.560Z Has data issue: false hasContentIssue false
  • English
  • Français

International Political Economy, Global Financial Orders and the 2008 Financial Crisis

Published online by Cambridge University Press:  19 March 2013

Daniel W. Drezner  and
Kathleen R. McNamara
Daniel W. Drezner
Affiliation:
Fletcher School of Law and Diplomacy at Tufts University. E-mail: [email protected]
Kathleen R. McNamara
Affiliation:
Georgetown University. E-mail: [email protected]
Get access Rights & Permissions [Opens in a new window]

Abstract

The 2008 financial crisis triggered the most severe global economic downturn since the Great Depression. The crisis has provoked soul-searching among economists, yet international political economy (IPE) scholars have been relatively sanguine. We argue that IPE has strayed too far away from studying the geopolitical and systemic causes and consequences of the global economy. IPE must explain the generation and transformation of global financial orders. Both the distribution of political power and the content of economic ideas will shape any emergent global financial order. A Kuhnian life-cycle framework of global financial orders permits a systemic approach to global finance that integrates the study of power and social logics into our understanding of markets.

Type
Reflections
Information
Perspectives on Politics , Volume 11 , Issue 1 , March 2013 , pp. 155 - 166
Copyright
Copyright © American Political Science Association 2013 

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

References

Acemoglu, Daron, and Robinson, James. 2012. Why Nations Fail. New York: Crown.Google Scholar
Ahamed, Liaquat 2009. Lords of Finance: The Bankers Who Broke The World. New York: Penguin.Google Scholar
Andrews, David, ed. 2005. International Monetary Power. Ithaca, NY: Cornell University Press.Google Scholar
Azari, Julia, and Smith, Jennifer. 2012. “Unwritten Rules: Informal Institutions in Established Democracies.” Perspectives on Politics 10(1): 37–55.Google Scholar
Bach, David, and Newman, Abraham. 2007. “The European Regulatory State and Global Public Policy: Micro-Institutions, Macro-Influence.” Journal of European Public Policy 14: 827–46.Google Scholar
Barnett, Michael, and Duvall, Raymond. 2005. “Power in International Politics.” International Organization 59(1): 39–75.Google Scholar
Barnett, Michael, and Finnemore, Martha. 2004. Rules for the World. Ithaca, NY: Cornell University Press.Google Scholar
Baumgartner, Frank, and Jones, Bryan, eds. 2002. Policy Dynamics. Chicago: University of Chicago Press.Google Scholar
Baumgartner, Frank, and Jones, Bryan 2009. Agendas and Instability in American Politics. Second edition. Chicago: University of Chicago Press, 2009.Google Scholar
Bellin, Eva. 2012. “Reconsidering the Robustness of Authoritarianism in the Middle East: Lessons from the Arab Spring.” Comparative Politics 44(2): 127–49.Google Scholar
Bernhard, William, Broz, Lawrence, and Clark, William. 2002. “The Political Economy of Monetary Institutions. Special Issue.” International Organization 56(4): 693–910.Google Scholar
Bernhard, William, and Leblang, David. 1999. “Democratic Institutions and Exchange Rate Commitments.” International Organization 53(1): 71–97.CrossRefGoogle Scholar
Best, Jacqueline. 2005. The Limits of Transparency: Ambiguity and the History of International Finance. Ithaca, NY: Cornell University Press.Google Scholar
Brooks, Sarah, and Mosley, Layna. 2012. “Categories, Creditworthiness and Contagion: How Investors' Shortcuts Affect Sovereign Debt Markets.” Prepared for the 2012 Annual Meetings of the American Political Science Association, New Orleans, LA, August 30–September 2.Google Scholar
Burgin, Angus. 2012. The Great Persuasion: Reinventing Free Markets since the Depression. Cambridge: Harvard University Press.Google Scholar
Chinn, Menzie, and Frieden, Jeffry. 2011. Lost Decades: The Making of America's Debt Crisis and the Long Recovery. New York: W.W. Norton.Google Scholar
Chwieroth, Jeffrey. 2008. “Normative Change from Within: The International Monetary Fund's Approach to Capital Account Liberalization.” International Studies Quarterly 52(1): 129–58.CrossRefGoogle Scholar
Cohen, Benjamin. 1996. Phoenix Risen: The Resurrection of Global Finance. World Politics 48(2): 268–96.CrossRefGoogle Scholar
Cohen, Benjamin. 2008a. “The International Monetary System: Diffusion and Ambiguity.” International Affairs 84(3): 455–70.Google Scholar
Cohen, Benjamin. 2008b. International Political Economy: An Intellectual History. Princeton, NJ: Princeton University Press.CrossRefGoogle Scholar
Cohen, Stephen, and DeLong, J. Bradford. 2009. The End of Influence: What Happens When Other Countries Have the Money. New York: Basic Books.Google Scholar
Crouch, Colin. 2011. The Strange Non-Death of Neoliberalism. Cambridge: Polity Press.Google Scholar
Drezner, Daniel W. 2007. All Politics Is Global. Princeton, NJ: Princeton University Press.Google Scholar
Drezner, Daniel W. 2009. “Bad Debts: Assessing China's Financial Influence in Great Power Politics.” International Security 34(2): 7–45.Google Scholar
Eichengreen, Barry. 2009. “The Last Temptation of Risk.” National Interest 101: 8–14.Google Scholar
Eichengreen, Barry. 2011. Exorbitant Privilege: The Rise and Fall of the Dollar and the Future of the International Monetary System. New York: Oxford University Press.Google Scholar
Eichengreen, Barry, and Irwin, Douglas. 2009. “The Slide to Protectionism in the Great Depression: Who Succumbed and Why?” NBER Working Paper No. 15142.Google Scholar
Eichengreen, Barry, and O'Rourke, Kevin. 2010. A Tale of Two Depressions: What Do the New Data Tell Us? VoxEU, March 8. Accessed at http://www.voxeu.org/index.php?q=node/3421.Google Scholar
Farrell, Henry, and Finnemore, Martha. 2009. “Ontology, Methodology and Causation in the American School of International Political Economy.” Review of International Political Economy 16(1): 58–71.Google Scholar
Ferchen, Matt. 2012. “Whose China Model Is It Anyway? The Contentious Search for Consensus.” Review of International Political Economy, forthcoming.Google Scholar
Foot, Rosemary, and Walter, Andrew. 2011. China, The United States, and Global Order. Cambridge: Cambridge University Press.Google Scholar
Galbraith, John Kenneth. 1993. A Short History of Financial Euphoria. New York: Viking.Google Scholar
Gilpin, Robert. 1975. US Power and the Multinational Corporation: The Political Economy of Foreign Direct Investment. New York: Basic Books.Google Scholar
Gilpin, Robert. 1981. War and Change in World Politics. New York: Cambridge University Press.Google Scholar
Gilpin, Robert. 2000. The Challenge of Global Capitalism. Princeton, NJ: Princeton University Press.CrossRefGoogle Scholar
Gourevitch, Peter. 1978. “The Second Image Reversed: The International Sources of Domestic Politics.” International Organization 32(4): 881–912.Google Scholar
Gourevitch, Peter. 1986. Politics in Hard Times: Comparative Responses to International Economic Crises. Ithaca, NY: Cornell University Press.Google Scholar
Greenspan, Alan. 2007. The Age of Turbulence. New York: Penguin.Google Scholar
Hall, Peter. 1989. The Political Power of Economic Ideas. Princeton, NJ: Princeton University Press.Google Scholar
Halper, Stefan. 2010. The Beijing Consensus. New York: Basic Books.Google Scholar
Helleiner, Eric. 1996. States and the Reemergence of Global Finance. Ithaca, NY: Cornell University Press.Google Scholar
Helleiner, Eric. 2011. “Understanding the 2007–2008 Global Financial Crisis: Lessons for Scholars of International Political Economy.” Annual Review of Political Science 14: 67–87.Google Scholar
Helleiner, Eric, and Kirshner, Jonathan, eds. 2009. The Future of the Dollar. Ithaca, NY: Cornell University Press.Google Scholar
Helleiner, Eric, and Pagliari, Stefano. 2011. “The End of an Era in International Financial Regulation? A Postcrisis Research Agenda.” International Organization 65(1): 169–200.Google Scholar
Helleiner, Eric, Pagliari, Stefano, and Zimmermann, Hubert. 2010. Global Finance in Crisis. The Politics of International Regulatory Change. London: Routledge.Google Scholar
Hirschman, Albert. 1945. National Power and the Structure of Foreign Trade. Berkeley: University of California Press.Google Scholar
International Monetary Fund. 2012. World Economic Outlook 2012. Washington, DC. October.Google Scholar
Jervis, Robert. 1997. System Effects: Complexity in Political and Social Life. Princeton, NJ: Princeton University Press.Google Scholar
Kapstein, Ethan. 1992. “Between Power and Purpose: Central Bankers and the Politics of Regulatory Convergence.” International Organization 46(1): 265–87.Google Scholar
Kennedy, Scott. 2010. “The Myth of the Beijing Consensus.” Journal of Contemporary China 19(65): 461–77.Google Scholar
Keohane, Robert. 2009. “The Old IPE and the New.” Review of International Political Economy 1(1): 34–46.Google Scholar
Khong, Yuen Foong. 1978. Manias, Panics and Crashes. New York: Basic Books.Google Scholar
Khong, Yuen Foong. 1992. Analogies at War: Korea, Munich, DienBeinPhu, and the Vietnam Decisions of 1965. Princeton, NJ: Princeton University Press.Google Scholar
Kindleberger, Charles. 1978. Manias, Panics, and Crashes: A History of Financial Crises. NY: Basic Books.Google Scholar
Kirshner, Jonathan. 2009. “Realist Political Economy: Traditional Themes and Contemporary Challenges.” In Routledge Handbook of International Political Economy, ed. Blyth, M.. New York: Routledge.Google Scholar
Knorr, Klaus. 1975. The Power of Nations. New York: Basic Books.Google Scholar
Krasner, Stephen D. 1976. “State Power and the Structure of Foreign Trade.” World Politics 28(3): 317–47.Google Scholar
Krasner, Stephen D., ed. 1983. International Regimes. Ithaca, NY: Cornell University Press.Google Scholar
Krugman, Paul. 2009. “How Did Economists Get It So Wrong?” New York Times Magazine, September 2.Google Scholar
Kuhn, Thomas. 1962. The Structure of Scientific Revolutions. Chicago: University of Chicago Press.Google Scholar
Lake, David. 2006. “International Political Economy: A Maturing Interdiscipline.” In The Oxford Handbook of Political Economy, ed. Weingast, B. and Wittman, D.. New York: Oxford University Press.Google Scholar
Lake, David. 2009. “Open Economy Politics: A Critical Review.” Review of International Organizations 4(3): 219–44.Google Scholar
Legro, Jeff. 2005. Rethinking the World: Great power Strategies and International Order. Ithaca, NY: Cornell University Press.Google Scholar
Lewis, Michael. 2009. The Big Short. New York: W.W. Norton.Google Scholar
Lipson, Charles. 1991. “Why Are Some Agreements Informal?” International Organization 45(4): 495–538.Google Scholar
Loser, Claudio. 2009. “Global Financial Turmoil and Emerging Market Economies.” Asian Development Bank, March.Google Scholar
Mastanduno, Michael. 2009. “System Taker and Privilege Taker: U.S. Power and the International Political Economy.” World Politics 61(1): 121–54.Google Scholar
McCloskey, Dierdre. 2010. Bourgeois Dignity: Why Economics Can't Explain the Modern World. Chicago: University of Chicago Press.Google Scholar
McNamara, Kathleen R. 1998. The Currency of Ideas: Monetary Politics in the European Union. Ithaca, NY: Cornell University Press.Google Scholar
McNamara, Kathleen R. 2003. “Globalization, Institutions, and Convergence: Fiscal Adjustment on the Way to EMU.” In Globalizing Authority, ed. Kahler, Miles and Lake, David. Princeton, NJ: Princeton University Press.Google Scholar
McNamara, Kathleen R. 2009. “Of Monocultures and IPE.” Review of International Political Economy 16(1): 72–84.Google Scholar
Milgrom, Paul, and Roberts, John. 1982. “Limit Pricing and Entry under Incomplete Information: An Equilibrium Analysis.” Econometrica 50(March): 443–59.Google Scholar
Mill, John Stewart. 1869. On Liberty. London: Longman, Roberts & Green.Google Scholar
Minsky, Hyman. 1986. Stabilizing an Unstable Economy. New York: McGraw-Hill.Google Scholar
Mokyr, Joel. 2010. The Enlightened Economy: An Economic History of Britain 1700–1850. New Haven: Yale University Press.Google Scholar
Mosley, Layna. 2003. Global Capital and National Governments. Cambridge: Cambridge University Press.Google Scholar
Mosley, Layna, and Singer, David 2009. “The Global Financial Crisis: Lessons and Opportunities for International Political Economy.” International Interactions 35(4): 420–29.Google Scholar
Nadelmann, Ethan. 1990. “Global Prohibition Regimes: The Evolution of Norms in International Society.” International Organization 44(4): 479–526.Google Scholar
Naughton, Barry. 2010. “China's Distinctive System: Can it be a Model for Others?” Journal of Contemporary China 19(65): 437–60.CrossRefGoogle Scholar
Norrlof, Carla. 2010. America's Global Advantage: U.S. Hegemony and International Cooperation. Cambridge: Cambridge University Press.Google Scholar
Nye, Joseph. 2011. The Future of Power. New York: Public Affairs.Google Scholar
Oatley, Thomas. 2011. “The Reductionist Gamble: Open Economy Politics in the Global Economy.” International Organization 65(2): 311–41.Google Scholar
Pauly, Louis. 1997. Who Elected the Bankers? Surveillance and Control in the World Economy. Ithaca, NY: Cornell University Press.Google Scholar
Polanyi, Karl. 1944. The Great Transformation. Boston: Beacon Press.Google Scholar
Quiggin, John. 2010. Zombie Economics. Princeton, NJ: Princeton University Press.Google Scholar
Rajan, Raghuram. 2010. Fault Lines. Princeton, NJ: Princeton University Press.Google Scholar
Ramo, Joshua. 2004. The Beijing Consensus. London: Foreign Policy Centre.Google Scholar
Raustalia, Kal, and Victor, David. 2004. “The Regime Complex for Plant Genetic Resources.” International Organization 58(2): 277–309.Google Scholar
Reinhart, Carmen, and Reinhart, Vincent. 2010. “After the Fall.” NBER Working Paper No. 16334, September.Google Scholar
Reinhart, Carmen, and Rogoff, Kenneth. 2009. This Time Is Different: Eight Centuries of Financial Folly. Princeton, NJ: Princeton University Press.Google Scholar
Roach, Stephen. 2009. “Manchurian Paradox.” National Interest 101: 59–65.Google Scholar
Rodrik, Dani. 2011. The Globalization Paradox: Democracy and the Future of the World Economy. New York: W.W. Norton.Google Scholar
Roubini, Nouriel, and Mihm, Steven. 2010. Crisis Economics. New York: Penguin Press.Google Scholar
Ruggie, John Gerard. 1982. “International Regimes, Transactions, and Change: Embedded Liberalism in the Postwar Economic Order.” International Organization 36(2): 379–415.CrossRefGoogle Scholar
Schiller, Robert. 2008. The Subprime Solution: How Today's Global Financial Crisis Happened, and What to Do about It. Princeton: Princeton University Press.Google Scholar
Schwartz, Herman. 2009. Subprime Nation: American Power, Global Capital, and the Housing Bubble. Ithaca, NY: Cornell University Press.Google Scholar
Simmons, Beth. 1994. Who Adjusts? Princeton, NJ: Princeton University Press.Google Scholar
Simmons, Beth, Dobbin, Frank, and Garrett, Geoff. 2006. “Introduction: The International Diffusion of Liberalism.” International Organization 60(4): 781–810.Google Scholar
Simmons, Beth, and Elkins, Zachary. 2004. “The Globalization of Liberalization: Policy Diffusion in the International Political Economy.” American Political Science Review 98(1): 171–89.Google Scholar
Singer, David Andrew. 2007. Regulating Capital: Setting Standards for the International Financial System. Ithaca, NY: Cornell University Press.Google Scholar
Strange, Susan. 1987. “The Persistent Myth of Lost Hegemony.” International Organization 41(4): 551–74.Google Scholar
Subramanian, Arvind. 2011. Eclipse: Living in the Shadow of China's Economic Dominance. Washington: Peterson Institute for International Economics.Google Scholar
Tomz, Michael. 2007. Reputation and International Cooperation: Sovereign Debt across Three Centuries. Princeton, NJ: Princeton University Press.Google Scholar
Weyland, Kurt. 2009. “The Diffusion of Revolution: ‘1848’ in Europe and Latin America.” International Organization 63(3): 391–423.Google Scholar
Williamson, John. 1990. “What Washington Means by Policy Reform.” In Latin American Adjustment: How Much Has Happened? ed. Williamson, John. Washington, DC: Institute for International Economics.Google Scholar
Wolf, Martin. 2008. Fixing Global Finance. Baltimore, MD: Johns Hopkins University Press.Google Scholar
Woods, Ngaire. 2008. “Whose Aid? Whose Influence? China, Emerging Donors and the Silent Revolution in Development Assistance.” International Affairs 84: 1205–21.Google Scholar
Yang, Yao. 2010. “The End of the Beijing Consensus.” ForeignAffairs.com, February 2. Accessed at http://www.foreignaffairs.com/articles/65947/the-end-of-the-beijing-consensus?page=show.Google Scholar
Yergin, Daniel, and Stanislaw, Joseph. 1997. The Commanding Heights. New York: Simon and Schuster.Google Scholar
Yu, Yongding. 2010. “A Different Road Forward.” China Daily, December 23.Google Scholar
Zhou, Xiaochuan. 2009. “Reform the International Monetary System.” People's Bank of China, March 23. Accessed at http://www.pbc.gov.cn/english//detail.asp?col=6500&ID=178.Google Scholar