IR 1112 - Conflicts in the Global Order (Global Political Economy)

Britain created three international systems.

1)The gold standard and capital flow: An international monetary system that assists the exchange of goods and services. Today the International Monetary System is the system of exchanging one currency for another. They decide on the exchange rates either floating or fixed, the nature of reserve assets for example gold or foreign currencies and the control of capital movement, so money could flow freely between countries. The balance of payments of these countries could run a deficit and there is the risk of devaluation or deflation. This could lead to unemployment or lowered purchasing power. 2)Free trade: Ricardo showed with his competitive advantage that even weaker economies could benefit from free trade. Many countries did not accept this system of free trade and used protectionism to protect the domestic industry. 3)Balance of power: The era of 1815-1914 could be characterised as relatively peaceful. The security arrangement or the balance of power had 3 characteristics. 4)Concert of Europe, communication and consultation between European countries so that no single state grew too strong. 5)If a state grew too strong a temporarily coalition would emerge which would contain that state. 6)Domestic public opinion had to be excluded.

WW1 Consequences

A first consequence of the war is that power shifted from Europe to the US. The US was highly productive and other countries had to pay large sums of money back to the US. A second consequence is that within Europe labour unions and the communist party evolved. A third consequence of the war was the physical destruction of infrastructure. This posed a serious problem for the reorganisation of many states. Another consequence was that the end of the second World War also marked the end of the colonies.

Political science:

A top down perspective is taken, because institutions, groups and governments decide how resources are allocated and how power is divided. The study of political science is very diverse, nevertheless some similarities could be perceived.

The Mundell- Fleming trilemma could explain financial crises, implication for regional currencies and national autonomy.

Capital mobility: The ability for money to cross borders freely ( to attract investment and economic growth). Stable exchange rates: The existence of fixed or minimally floating currencies. (Ensure investors that the value of their money will not be lost through a depreciation). Monetary policy: The ability of a country to set its own interest rates to influence growth and employment (control money supply and interest rates to support domestic economic conditions). Many governments assigned a central bank independent of this policy. During slow growth and low inflation banks would lower the interest rates and raise interest rates when the inflation is high.

Liberal interpretation of the Asian financial crisis of 1997

Causes: Crony capitalism, lack of transparency Key issues: Corruption, lack of liberal economic practices Lesson: Increase transparency and good practice in developing countries

State power interpretation of the Asian financial crisis of 1997

Causes: Overrapid liberalisation, reduced state capacity to regulate Key issues: Clash of Anglo-American versus Asian models Lesson: Limit financial speculation through state policies

Critical interpretation of the Asian financial crisis of 1997

Causes: Predatory liberalism, power of financial interests, systematic flaws Key issues: Human suffering caused by financial collapse Lesson: Reform international financial system, defend national system

Sustainability:

The environmental problems in the global economy due to consumption, production and distribution.

Theories are used for a variety of purposes

They can prioritize information and allow individuals to turn their attention to the most important issues They can be used to make predictions about the future so that action can be taken to prepare for upcoming events They can be utilised to plan action or mobilize support for particular action

Rigid monetary and financial systems: Two aspects seem to be problematic in the monetary and financial system.

Use the gold standard again, but in the wrong way. The value of the currency in Britain was for example overvalued which led to less export, less production and higher unemployment. War reparations for Germany to France. The Treaty of Versailles laid out the terms of defeated states. Germany had to pay large amounts of money to France, however the economic impact was not taken into account. This led to international financial crisis.

Crony capitalism

an economic system characterized by close, mutually advantageous relationships between business leaders and government officials.

Devalorisation

characteristics of masculinity are more valued than characteristics of femininity.

Development

is both a process and a condition. A process whereby a society may transform to a self- sustaining country. It is an ongoing process with cultural, political, social and economic change. Conditions are: greater access to new technologies, taking advantage of market forces and individual actors being more aware of economic development.

politics over economics

political economy

Four issues are discussed to show state- firm interactions (TNCs)

Decision making and national autonomy: Due to the globalisation the state is only one player among many and therefore they are losing their autonomy. Firms are no longer dependent on regulation of governments in a single state. TNCs are footloose. Transforming state policies: TNCs also transformed the nature of the state. Competition state is the term used to describe the competition among states to stay attractive to foreign investors. To do so governments have to take a more neoliberal approach. labour: Two issues could be distinguished here. The first is that labour moves from high wage(developed) to low wage (developing) countries resulting in unemployment in the developed countries. The second is the bad working conditions in the developing countries.

Benefits of FDI?

FDI could be beneficial from an economic perspective while it is not beneficial from a cultural perspective at the same time.

fascism (Germany and Italy)

Fascists would like to keep a limited market economy, but eliminate all democratic institutions in the industrial and political realm. Fascists were nationalistic and racist.

When investors lose confidence in an economy they spread their money across different countries which will result in more panic and problems. This effect is known as contagion. To reduce this effect two institutions are established.

Financial stability Forum (FSF): the FSF is responsible for offshore financial centers, cross border capital flows and highly leveraged institutions or hedge funds. Group of Twenty (G20): The G7, a predecessor of the G20, is a combination of only developed states, while the G20 also includes several developing countries. The G20 concentrates on financial transactions, exchange rate risk, social safety and the environment

The World Wars: trade patterns suffered in two ways during and following the World Wars.

First there was a change of trading partners and the direction of trade and second there was a change in composition of exports, since production shifted towards war production. This allowed some regions in the world to have their own industrialisation. Capital movements were directed to war products. Moreover the gold standard was abandoned. The US became world's largest creditor and Germany turned as the world's largest debtor. The balance of power was also discredited by for example secret treaties.

The debate around development could be divided into two issues:

Internal or external factors contributing to the success or failure of the economic development of a society. Proponents of the internal factors are the ones who believe in an internal causation theory. The availability of resources will show whether a country is able to grow or not. Causes are found at domestic level. This view is also called modernisation theory. The role of the state and market in promoting development. The newly industrialising countries (NICs) (Korea, Taiwan, Singapore and Hong Kong) had low inflation, fast growth, macro-economic stability, high saving and high life expectancy and literacy. Neo liberalists argued that this is the result free markets, less government intervention, deregulation and an attractive investment climate. They emphasise the export oriented industrialisation (EOI). Everything should be done to encourage exports.

International or global governance:

Intersection between environmental concerns and the global political economy. International cooperation is needed to manage domestic and global environmental problems in a way that does not place a particular state at a political or competitive disadvantage.

Why did liberalism not work and why did the government have to intervene?

It is a kind of vicious cycle, a double movement. The first part of the movement is to create a liberal market system where employees sell their labour in exchange for wages. In this movement employees have little protection from governments and wages could decrease because of the drive of profit. The second movement is a reaction to the first in that the labourers asked for more government involvement to protect their jobs. Because of both movements, other forms of societies started to emerge.

Fixed exchange rates are hard to maintain because:

It needs cooperation between countries, which had its limits. Fixed exchange rates are hard to maintain when having increased capital mobility.

Money and finance

❖ How does the IMS work? ❖ A narrative of the finical crisis ❖ Governance/management: how was the 2008 financial crisis governed?

Trade:

❖ Internationalisation of trade ❖ Governance and institutionalisation ❖ Debates about 'free trade' v 'protectionism' Know the basics of each area: but link up to history and institutions

❖ Key concepts, thinkers and problems

❖ Polanyi: The critique of the 'market society' ❖ Harvey/Standing: The politics of contemporary GPE ❖ The origins and background of neoliberalism ❖ Class politics, power, inequality ❖ Links to history, dynamics and theory

The Economic Nationalist Perspective

-15th century -synonymous to mercantilist, neo- mercantilist, statist, state- based theory, power politics or most important realism -stresses the importance of the state in understanding activities in international relations (IR) -States and nations, rather than individuals are the center of focus -The state is prior to the market and market relations are shaped by political power -a limited amount of wealth available in the world -to gain wealth, need self-interst -duty of the state to protect its own self-interest - an anarchical system with a lack of central authority -zero-sum game -the state is the central instrument through which people can attain their goals -constant struggle for power and wealth -Descriptive: in a sense that markets could only exist when the state continuously intervenes in production, consumption and investment. They believe that markets are not natural and can only exist within a social context. -Predictive: economic nationalists move beyond description and also provide policy advice. Given their analysis of the dynamics of political economy, such advice is geared towards supporting and maintaining state power -recognize the importance of market-based actors such as firms, but subordinate their importance to that of the state. -the economic power of transnational corporations (TNCs) is acknowledged, but the overall power of such firms remains limited - firms are subject to the dictates of states -Defensive realists: do see globalisation as a threat. They think that globalisation prevents state actors from fulfilling their goals. Supports free trade, but do think that states with the most political and economic power gain the most - Skeptical realists: are totally rejecting that globalisation is taking place. So the power of the state remains unchanged. For them states remain the only significant and legitimate power. - this perspective is seen in protectionism and the driving force between colonialism

Liberal Perspective

-19th century - focuses on a wide range of actors influencing the global political economy -do not only focus on the state, but also on the individuals, NGOs, IGOs and corporations -The individual is the main actor and forms the starting point of analysis. The individual is able to make choices and to negotiate with others. Therefore the liberalist perspective also considers cooperation between individuals rather than only conflict. - if everyone collaborates a positive sum could be achieved -emphasises that the state has diverse interests, rather than a unitary interest as argued in the realist perspective -The world may be anarchic, but interdependence makes room for cooperation between states -Firms are the source of economic wealth according to liberalism -Some liberals like to see no intervention of the government at all, whilst others stress a partly involved government. -Neoclassical liberalist uses the individual as starting point for further analyses -Other liberals focus not only on the individual, but also on firms, states, IGOs and NGOs. -The market is the center of economic life. Intervention in the market will result in less efficiency. Markets lead to prosperity. Economic failure is the result of intervention of the government in this economy -Hyper-liberals do see globalisation as a positive force for good -Keynesian liberals are sensitive to some negative consequences of globalisation -History has shown that protectionism from a realist perspective has led to impoverished state economies -The comparative advantage of David Ricardo and the invisible hand of Adam Smith have shown that the everyone could accumulate wealth even when a state has no absolute advantage at all. There will always be a relative advantage for both countries involved. -Currently, international institutions are based on the principle of free trade. - Liberalism often underestimates the power of governments and firms to manipulate markets. The crisis of 2008 puts some questions around the liberalist perspective and the role of the different actors involved.

Critical Perspective

-19th century in reaction to liberal thought -aka. radical or critical thought -Marxists seek to change the world and would like to know how the world is structured -Other perspectives, feminism, environmentalism. The perspectives have in common that they are constantly searching for equity. -Marxists are not primarily concerned with states or individuals, but with class systems. -Marxists admire the collective approach of the nationalist perspective, but reject the individualism of the liberalist perspective. -The current capitalist stage of the class system contains a clear distinction between owners of production (bourgeoisie) and labour (proletariat). -Argues there's a constant conflict between classes -The forces of production are divided in the instruments of production (land, capital and technology) on one side and the raw materials (inputs of materials) on the other side. -In the class system there is also a division between the base structure and the superstructure. -In this base structure planning is required to establish a well-organised and structured system. However in this base structure different cultures, institutions and political power are not taken into account. -These factors are taken into account in the superstructure. One could imagine that these factors need a more flexible behaviour and structure. More freedom is needed in the superstructure. -the state is the representative of class interest. -The firm and market are instruments of exploitation. -Dominance and exploitation are the main features of Marxist theories -Marxist view international relations as conflictual and unstable, because of three reasons: 1)If the capitalists engage in competition, profits will fall. Lower profits will result in lower wages for the workers. 2)Uneven development. Some centers increase their wealth at the expense of other centers. (see dependency theory) 3)Fluctuations will lead to overproduction or underconsumption. -Dependency theory explains that poor countries faced obstacles to development, because they were vulnerable to economic exploitation from developed states. Development of some states will result in underdevelopment of other states (zero sum game). Conflict is inevitable because of the drive for profit. Lenin argues that conflicts and wars are the result of competition and were necessary to increase profit rates (capitalist imperialism). -Marxists view globalisation as a myth. It will increase the power of capital over labour, the West over the other states and further increase the power of the United States. It increases exploitative relationships and this is bad from the perspective of Marxism.

Three trends have been increasingly visible after the Cold War

1. Competition Capitalism and state transformation: Rivalry between differing models of capitalism became important during this era. There was no one best system. Each system had shown strengths and weaknesses in times of economic success and times of economic downturn. European states mostly had a broad welfare system for its citizens, but also had high unemployment levels. The US was not able to provide its citizens with basic healthcare, however the unemployment was lower. Also the nature of the state differed among the first world countries. 2.The information revolution: The new technologies in IT facilitated the globalisation of economic activity. Better communication is also a direct effect of the new technologies. New sectors are created and productivity increased. However the ethical implications such as cloning have become critical issues today. The gap between the developing world and developed world also increases. Networks appear and this implies that working through institutions with different layers of authority is no longer needed. Lastly the information revolution made American military power much more effective and efficient. 3. International organisation and governance: The number of international organisations has grown significantly in today's global economy. One of these organisations is the United Nations, the successor of the League of Nations. Other organisations could be categorised as International economic organisations such as IMF, WTO (successor if the GATT). All these institutions have provided support for an renewed form of multilateralism. Despite economic downturn this multilateral system still holds. Some people say that these institutions are too powerful. Another type of international organisations are the corporate and civic organisations. These profit and nonprofit organisations have also been busy expanding their international contacts. Profit organisations such as big corporations have often been accused to lobby with governments an international organisations. Non-profit citizens organisations also lobby with Trans National Companies (TNCs) multilateral economic institutions and governments.

Sustainable development:

Development that meets the needs of the present generation without jeopardizing the resources available to the future generation.

analysis of environmental degradation and sustainability it is important to take two other perspective into account:

Environmentalism (technocentrism): The main objective is to satisfy the needs of humans. This perspective is based on western cultural values and the capitalist system. Two variants could be recognised. Reformist (modern economic growth is the main cause of environmental degradation) and conservatives (capitalism and personal liberation are the drivers for change.) Environmental degradation is the result market failure. To protect the environment it is important to first determine the real cost and then the most efficient solutions. Managerial environmentalism is the term used to describe this policy. Ecologist (ecocentrism): The main objective is the survival and progress of the environment.

The traders moved from coastal settlements into Africa and Asia. A second wave of colonisation emerged. There were four significant developments:

European powers enlarged there empires. Three European states ( Germany, Italy and Belgium) joined the colonial movement. America and Asia succeeded in continental movements. Japan was able to adapt to the industrial revolution and took control of Korea.

Production and labour

Fordism/Post-Fordism TNCs What changed in the 1970s? Know the basics of each area: but link up to history and institutions

Two types of foreign investment can be dinstinguished:

Foreign direct investment: Investment made outside the home country of the investing company. Control over the resources remains with the investor ( influence decisions in company). Resources could be assets or intermediate goods. Foreign indirect investment (portfolio investment): Specific assets and intermediary goods (capital, debt or equity). Control remains with the seller (No influence in decisions of companies). Only financial resources are transferred.

Keynesian economics

Governments are needed to achieve the optimal allocation of the resources. Governments should help when there is a recession. Keynesian economics also believe that the government should provide a wider range of public goods. more positive and expansive attitude about the role of the government.

Three main concerns about the euro:

Greece might withdraw from the euro and implement the drachma again. This would stimulate export and tourist spending. Would the euro survive this withdrawal of Greece? Which countries would follow Greece? Portugal, Spain and Ireland followed Greece in the crisis. Portugal had a large public sector and Spain and Ireland had housing bubbles. Fragility of the global financial system.

Why Britain? Why this period?

Growth of culture and knowledge: There was a growth of autonomy in intellectual enquiry, scientist were able to break free of the church. The introduction of Language of proof in scientific fields led to a continuous motivation to research and invent. Technical expertise: Supported by economic and political structures, liberal state economies with more power to markets and punishment of bad behaviour solidified. Political rules created an obligation to work in the industrialised cities. Rise of liberal state: Laissez- faire, laissez- passer, let it be, let it pass. This refers to economies without tolls, taxes or state interventions. From a political perspective the individual rather than the state was the point of attention. Because of the bad work conditions of labourers trade unions and democratic movements arose. Karl Marx became the dominant theorist of class relations during this time. His message was to unite the working class and overthrow the capitalist class. Marx would create another form of society based on common ownership of production. A society of equality. Favourable international position: The industrial revolution together with the increased possibilities of transportation caused enormous growth for the world economy.

Development, Gender, Environment

History/key focus Challenges to how we understand the GPE Know the basics of each area: but link up to history and institutions

Environment:

Human activity on the natural environment. Attention is paid to the use and misuse of resources.

Environmental degradation:

Human uses nature in ways that threaten the sustainability of the natural resources and create unwanted problems such as pollution. Is the historical result of capital accumulation and the pursuit of economic growth.

Zero-sum game

If the total gains of the participants are added up and the total losses are subtracted, they will sum to zero

Neoclassical economics:

In favour of free markets. Individuals should behave in their own self-interest to create the most efficient allocation of resources. Governments should be involved as less as possible. Governments are only needed to provide basic goods ( institutions, armies etc.) to ensure the functioning of the free market.

Institutional economics:

Markets are not natural but created through institutions like legal structures and financial systems. more positive and expansive attitude about the role of the government.

From Fordist to Post-Fordist production:

Mass production and mass consumption resulted in an rapid increase of TNCs in the 50s and 60s. Price competitiveness was the main objective. At the end of the 70s production innovation became most important. Consumer demand became the main objective. Specialisation, quality control and differentiation are the most important objectives today.

Bretton Woods System + it's breakdown

Named for a conference held at Bretton Woods, New Hampshire, in 1944, this system provided the foundation for postwar economic globalization, including the World Bank and the International Monetary Fund; based on the promotion of free trade, stable currencies, and high levels of capital investment.

Theoretical perspectives about the causes and solutions of environmental degradation.

Nationalists argue that all nations act in their own self-interest and that international cooperation is hard to achieve. Realist also argue that issues regarding the environment will also be in the advantage of the most dominant (developed) states. Realist are skeptical about international cooperation. Sustainable development will only be achieved when states pursuit policies to be in their self-interest. States rather admire economic growth than sustainable development. That is why sustainable development will be no reality but an aspiration. Liberals argues that there is a mutual interest to work together at issues regarding the environment. A network of independencies will result in a positive sum for the whole society. Non-governmental and intergovernmental organisations also help to create a positive sum outcome. Environmental degradation is explained by market failure. Critical: Conflicts between capitalist states makes cooperation impossible. And if cooperation is made possible the results will be in the advantage of the most dominant states what would create larger inequality.

There are three main features that characterise the current mainstreaming of gender in policy and practice.

Normative commitment to gender equality: five documents have reinforced the commitment. See page 209 of the book. The documents have an international character. The millennium development goals (MDG) is an example which shows that gender issues are included. One of the goals is to promote gender equality and the empowerment of women. The reinforcing of the normative developments: It is about whether the abavementioned normative rules also have become part of the UN system. Four functions within the UN merged together and formed the United Nations Entity for Gender Equality and the Empowerment of Women. Mainstreaming gender in international organisations: Many countries and institutions deal with gender differences. Take for example the ILO and the WTO. The Worldbank was slow in integrating gender issues.

The industrial revelation was characterised by three elements

Population was divided into capitalists, who owned the factories and equipment and labourers who sold their labour for wages. Production was organised around factories ( factory system). The entire economy was profit driven.

International Political Economy

The academic field of study surrounding the interactions of economic and political phenomena across state borders until the last quarter of the last century.

Major developments

Technological change: the tendency of companies to be more competitive, innovative, efficient and profitable caused rapid developments in the technological area. Firstly technological change led to new products by means of product differentiation. Secondly, technological change led to greater homogeneity among consumers, since it is more efficient to produce according to a global standard. Another development is the shortened lifetime of products, due the increased competition. Thereby the cost of R&D increased significantly. Communications and transport: Communication creates a fast and reliable way of information sharing between the TNC and its subsidiaries. Geographic distance is not a problem anymore. Transportation makes for products to be able to move cheap and fast between the TNC production and subsidiaries. Finance: Integrated financial markets facilitated global production. TNCs are better able to get funds all over the world. Globalisation in finance is the result of three key factors. Technological innovation Less government involvement in the legal and technical barriers of movement of capital Innovation in financial instruments (interest rates, currency and stock market, swaps and options). Political: Again three political factors that have had an effect on globalisation The interest of the US after the second World War to expand its business enterprises. Liberalisation of the financial market. The relocation of manufacturing and production to the third world. The policies of developing countries were to attract foreign investment. To reach this developing countries created export processing zones (EPZ). This is an area in a country created for export production. Regulations in these areas are often modified to attract investors. TNCs benefit from low wage labour and minimum external cost and governments gain the benefits of foreign currency earnings from exports.

International Monetary System (IMS):

The IMS is the currency exchange between countries. Two major developments could be identified after the second World War.

Bretton Woods

The first is the move from fixed to floating exchange rates. After the breakdown of the gold standard countries wanted a system with stable exchange rates. The solution was the gold exchange of Bretton Woods. In the system the US dollar was fixed to gold. The currency of other countries were fixed to the dollar. In this way it was possible to adjust the value of a currency when for example productivity levels fell. Two institutions were created to make the system work. First the International Monetary Fund (IMF). The IMF could loan money during a temporary downturn of a country. The second institution was the World bank. The system seemed stable, however according to the Triffin's dilemma there was one shortcoming. Robert Triffin worried what would happen when there were more US dollars outside the US than gold inside the US. The outflow of dollars was needed to help the rest of the world. In the 60s there were more dollars outside the US than gold inside. The US had to change its value of its currency and had to break the link with the gold. The second is the replacement of national currencies for a regional currency (e.g. euro).

GPE

The global and political environment from the last quarter of the 20th century until today. (an era in which citizens, corporations and states struggle in a world with intensified globalisation)

The increase in participation from women in workforce could be explained by:

The shift from agriculture to the service sector Rise of labour intensive manufacturing industries in East Asia. These export reliable industries are largely dependent on women. Women are better in jobs with high levels of communication, social and personal services.

United Nations Conference on Environment and Development (UNCED), known as the Earth Summit:

Their goal is to preserve environmental quality and combating environmental degradation. Sustainable development is seen as a new approach to development.

Mergers, strategic alliances and joint ventures:

There has been an enormous increase in takeovers from the 80s onwards. The reason for these takeovers were technological change, entering new markets, expansion of the service sector and increased pressure of shorter product life cycles. Companies have to respond quickly to the changes in the market and have to be locally aware.

Industrial Revolution, renewed imperialism and conflict 1800-1945

This period could be characterised by: Power and wealth in hands of the elites. In the mid-1800s Britain had a leading position in the first industrial revolution. Germany and the US had a leading position at the end of the 19th and the beginning of the 20th century during the second industrial revolution. The liberal market was created under bad working conditions for the workers. Benefits of free trade. Two important mechanisms were developed to exclude public opinion in policy making. The gold standard and social and economic adjustment to trade flows. Exclusion of affinity and ideology in the decision making. However democracy started to spread across some powerful European states at the end of the 19th century. The power difference between Europeans and non-Europeans increased. A second wave of colonialism was the result. War was the result of open competition and free trade between European countries.

Global Credit System (GCS):

This system is about lending and borrowing money. Europe needed credit to rebuild its economy. The US did this through the Marshall Plan, military spending and foreign investment. The Marshall plan had as requirement that the country liberalised the economy and engaged in free trade. The communist countries were not able to combine free trade with the planned economy, resulting in no Marshall funds. The Marshall funds had a role in the Cold War confrontation between the US and the Soviet Union. Opening up to free trade had as negative effect that countries were not able to manage their balance of payments.

Results of the period 1945-2010

Trade: Increase in the type and volume of trade. Creation of multilateral trade institutions such as the WTO reduced import tariffs an liberalised trade. Also regional agreements such as the NAFTA and EU were created. Unlike other eras, trade and investment took place under an elaborate system of rules. Production: Transnational corporate trade accounts for 50% of world trade. Some of the TNCs have sales larger than the GDP of some countries. There is a debate whether the influence of these TNCs is not too big. Some suggest that the state is losing power or that democracy is threatened. Another development is the increasing production in the East and South East region of Asia. The government in China creates tax free economic zones to attract foreign investment. Finance: The financial system had in the 70s transitioned from embedded liberalism to a more open neoliberal state economy. Through the developments in the information technology financial markets react immediately to the latest events. A crisis could go around the globe in a few days. Labour: Labour is not restricted to an area anymore. There is a global division of labour. Gender: The woman is taking care of the kids and the man is earning money to maintain its family. However women are joining the global workforce more and more. Development: After the decolonisation many developing countries still were dependent from private capital flows of their old colonisers. Some countries still struggle to industrialise. Environment: A negative effect of the industrialisation was the exploitation of the environment. Global warming and the Kyoto Protocol play a prominent role. Ideas: Vigorous debates about what form of capitalism is most appropriate. Also ideas about the globalisation should be taken into account. Security: Security issues were dominated by the US and the SU. Wars were often channeled to other countries which had to face the consequences. Governance: The proliferation of formal international organisations and the democratisation of state institutions were the most prominent developments.

Results of the period 1800-1945

Trade: Some level of free trade existed, but many countries were not able to compete with Britain and had all kind of trading barriers. Production: Development of industrial capitalism and production used for exports. Finance: From private to modern corporations. Due to the railway industries companies who needed large investment and profits for in the long run. This led to modernisation of financial investments and securities. Labour: Conflict between capitalists and workers. This conflict became subject of the political agenda. The workers had bad living conditions. Gender: Initially factory work was performed by children and women. Environment: Rising concerns about the pollution of the environment through the processes of the industrial revolution. Ideas: In three ways ideas were critical for the evolution. First technological innovation and the introduction of new energy sources. Second ideas about science, technology and religion. Third the ideas related to the social world. Three ideologies, liberalism, nationalism and racism were prevalent during this period. Security: Europe experienced no internal war for 100 years, however as already elaborated, in the US and other parts of the world great wars took place. A Eurocentric bias is obvious in the description of this period as Pax Britannica

two ways to study production structures:

Transnational Corporation: Examines the production of large multinational firms. Global commodity chains: Examines the production of a single commodity from raw material to end use.

Explaining the Growth of TNCs

Two theories could be used for the liberal perspective: 1)Product life cycle model of Raymond Vernon. 2)Ownership, location and internationalisation model of Dunning Strange emphasises three structural changes in the global economy instead of simply decisions taken by firms: Falling real cost of transport and communication Development of new technologies Creation of new financial instruments. A traditional theory of Stephen Hymer could also be used. His arguments are based on the oligopolistic business structure in the US and the systematic factors emphasizing the uneven development capital markets.

Bretton Woods and after

What are the key elements of Bretton Woods? ❖ What problem did it 'solve'? ❖ How did it decline? ❖ What replaced it?

The three traditions ❖ Realism/statism/neo-mercantilism ❖ Liberalism ❖ Critical/Marxist

What does each focus on? ❖ What are the key differences? ❖ How would each analyse particular GPE problems?

This inequality of women could be explained by several reasons:

Women often work temporarily and have part time jobs. This makes that jobs for women are less secure The working conditions are often bad and women are exposed to sexual harassment Another reason is that women are joining the workforce from a position of poverty and insecurity Women earn on average less than men, even when they have the same occupation Women have limited opportunities to climb the career ladder compared to men Women have poor bargaining and negotiation capacities Educational attainment is often lower for women

Transnational Corporation (TNC)

a firm that owns and controls production (value-added) facilities in two or more countries

Fordism

a short hand term to characterise a historical era, a whole social system (1940s-1970s)

Pax Britannica 1815-1914

was the period of relative peace between the Great Powers during which the British Empire became the global hegemonic power and adopted the role of a "global policeman"

Popualism

refers to a range of political stances that emphasize the idea of "the people" and often juxtapose this group against "the elite". The term developed in the 19th century and has been applied to various politicians, parties, and movements since that time, although has rarely been chosen as a self-description.

What was created to maintain monetary stability

the IMF, World Bank and Marshall Plan

International regulations increase due to

the reduction of autonomy of governments and the increased power of TNCs.

Glass ceiling

the situation in which women earn less for the same senior management position than men.