Showing papers in "Review of International Political Economy in 1994"

The territorial trap: The geographical assumptions of international relations theory

Abstract: Even when political rule is territorial, territoriality does not necessarily entail the practices of total mutual exclusion which dominant understandings of the modern territorial state attribute to it. However, when the territoriality of the state is debated by international relations theorists the discussion is overwhelmingly in terms of the persistence or obsolescence of the territorial state as an unchanging entity rather than in terms of its significance and meaning in different historical‐geographical circumstances. Contemporary events call this approach into question. The end of the Cold War, the increased velocity and volatility of the world economy, and the emergence of political movements outside the framework of territorial states, suggest the need to consider the territoriality of states in historical context. Conventional thinking relies on three geographical assumptions ‐ states as fixed units of sovereign space, the domestic/foreign polarity, and states as ‘containers’ of societies...

Passing judgement: Credit rating processes as regulatory mechanisms of governance in the emerging world order

Abstract: This article argues that certain knowledge-producing institutions located in the American financial industry- debt security or bond rating agencies -are significant forces in the creation and extension of the new, open global political economy and therefore deserve the attention of international political economists as mechanisms of 'governance without government'. Rating agencies are hypothesized to possess leverage, based on their unique gate-keeping role with regard to investment funds sought by corporations and governments. The article examines trends in capital markets, the processes leading to bond rating judgements, assesses the form and extent of the agencies' governance powers, and contemplates the implications of these judgements for further extension of the global political economy and the form of the emerging world order.

Wake up, Krasner! The world has changed

Abstract: (1994) Wake up, Krasner! The world has changed Review of International Political Economy: Vol 1, No 2, pp 209-219

Towards a political economy of food

Abstract: A political economy of food is proposed by drawing critically upon existing literature. First, food is understood in terms of a system of provision in which the connection between production and consumption is viewed as a chain of activities, vertically integrated. Different foods give rise to different systems of provision, and these are distinguished relative to other non‐food systems by their heavy dependence upon organic properties throughout the linkages from production to consumption. While emphasis is placed upon the tendencies to vertical (dis)integration along the food chain and to industrialization of food processing and agriculture, these are not interpreted as empirical trends within the confines of given structures, as is standard in the most recent food systems literature, but as potential supports to the reproduction or transformation of those structures. In particular, the structural relationships between agriculture and industry are interpreted as the historically contingent outc...

Exchange rate politics: Contemporary lessons from American history

Abstract: This essay makes two analytical points about the domestic and international politics of exchange rate issues. First, it argues that changes in the political prominence of currency values over time are best explained by changes in the level of international economic integration. The more cross‐border trade and investment takes place, the more national macroeconomic policies implicate the exchange rate, and the more exchange rates affect important socioeconomic actors. Second, the article provides a starting point to understand the pattern of domestic political conflict over currency values by analyzing the distributional impact of different currency regimes and levels. Internationally oriented economic groups prefer fixed exchange rates, domestically based groups prefer floating rates. Similarly, tradables producers prefer a relatively depreciated currency, producers of non‐tradable goods and services a relatively appreciated one. The arguments are brought to bear on American political conflict ov...

International political economy in the age of open Marxism

Abstract: In the last decade or so, transnational historical materialism has fashioned the most ambitious, and perhaps the most politically conscious, expression of critical epistemology in the analysis of global accumulation. It has made an immense contribution to the understanding of the structural power of capital in the world economy, and has been especially important in the analysis of the transnational construction of neo‐liberalism, and of the mechanisms by which global imperatives of accumulation have installed themselves as overdetermining principles of political unity. However, though it has claimed the heritage of Gramsci's philosophy of praxis, transnational historical materialism has not seriously addressed questions of political strategy in the world economy, and has not been able to define a political practice adapted to the global social formation that it has defined as its object of analysis. This article proposes both a critical reassessment of the epistemological claims of open Marxism, ...

Multinational enterprises, political economy and institutional theory: domestic embeddedness in the context of internationalization

Abstract: There is rising interest in placing the study of the multinational enterprise (MNE) at the core of political economy scholarship. This article attempts to locate the MNE in its outer institutional environments. MNEs are embedded in networks of relations with a number of important external actors, not only governments. These networks manifest marked differences between nations and regions, with differential implications for production and managerial arrangements within the firm, public policy choices and the constellation of MNE‐government relationships. In the distribution of wealth and power, MNEs are situated at the interface of domestic structures in national and regional political economies, and the process of internationalization within global political economic structures. A research agenda for the 1990s should, therefore, incorporate a political economy of the MNE in structures of global competition and cooperation that have institutional underpinnings. This study seeks to address elements...

Open Marxism and vulgar international political economy

Abstract: (1994). Open Marxism and vulgar international political economy. Review of International Political Economy: Vol. 1, No. 2, pp. 221-231.

International political economy: Abiding discord

Abstract: (1994). International political economy: Abiding discord. Review of International Political Economy: Vol. 1, No. 1, pp. 13-19.

What difference does difference make

Abstract: (1994). What difference does difference make? Review of International Political Economy: Vol. 1, No. 3, pp. 563-570.

Institutional adjustment and instrumental value

Abstract: Eastern Europe and Russia, in their struggles to make comprehensive transformations of their economies, are being guided mainly by neoclassical theories and advisors in pursuit of stabilization, privatization, and restructuring. It is the argument of this paper that an alternative approach holds greater promise. The paper offers major tenets and principles of a contemporary institutional‐evolutionary theory of institutional adjustment. That framework is then used to present and appraise an abbreviated version of the mainstream position, especially as reflected in the views of advisor Jeffrey Sachs. Of special significance is consideration of social value aspects of institutional adjustment.

On the political theory of political economy: conceptual ambiguity and the global economy

Abstract: This article explores conceptual ambiguities and contests involved in the movement from an ‘international’ to a ‘global’ economy. It argues that these contests involve, potentially, fundamental transformations in the concept of economic life. After offering an historical interpretation of the concept of the ‘economic’ in current International Political Economy, the article addresses three sets of conceptual contests raised by the forces of a global capitalist economy: descriptions of the geo‐economic map of the world economy; the identity of economic life, especially ambiguities in the relation of public and private life; and descriptions of the spatio‐temporal frame of economic life in the world economy. I conclude that the analysis of conceptual transformation and contest suggests a need for reassessing the political theory of the world economy.

Some remarks on 'economic imperialism' and international political economy

Abstract: 'Economic imperialism' celebrates a double meaning. The first concerns the phenomena of colonialism and neocolonialism. The second refers to the attempt to extend the core ideas of neoclassical economics to cover social science as a whole. In this second meaning 'economic imperialism' implies that the core assumptions of neoclassical economics can and should be applied to a wide variety of fields of study, including politics, international relations, sociology, anthropology, psychology, history and even biology, as well as economics itself. It is based on the belief that the idea of 'rational economic man' is appropriate to social science as a whole. This essay is concerned with 'economic imperialism' in the latter sense. It is written at a time when neoclassical economics has pushed all alternative paradigms to the fringes of its home discipline. Almost without exception, the prestigious economics departments in the world are dominated, and many exclusively populated, by neoclassical economists. All the core, high-status journals in economics are edited by economists of that same persuasion. Neoclassical dominance is most severe in the Anglo-American world but it is not confined to it. Today, the presuppositions of 'rational economic man' dominate the subject to an extent that has never been experienced before. Furthermore, the neoclassical approach is making itself felt outside economics. In 1957 Anthony Downs published An Economic Theory of Democracy in which the neoclassical presumption of rational choice was applied to democratic political systems. But it was not until the 1970s that the rational choice approach became firmly established in political science. Although neoclassical ideas do not dominate politics to the degree that they do economics, the paradigm of rational choice permeates much of Anglo-American political science and has a major influence in the field of international relations.

The evolution of socioeconomic order in the move to a market economy

Abstract: This paper addresses the problem of the formation of order in sodoeconomic systems in transition. One approach, stemming from interpretations of the writings of Bernard Mandeville and Adam Smith, culminates in modern general equilibrium theory in economics. However, no coherent and adequate formal model of the generation of social order and economic equilibrium has yet been produced on the basis of its atomistic and individualistic assumptions. Furthermore, general equilibrium theory does not deal with economic systems in an adequate sense. It can represent neither true markets, nor money, nor key types of knowledge and uncertainty, nor real time. Finally, it does not support a policy of laissez‐faire. In sum, the general equilibrium project now lies in ruins. It is argued here that rather than the interactions of atomistic and self‐seeking individuals, real capitalist economies depend on complex relations of loyalty and trust, pervading civil society and its interpersonal relationships. The over...

Constructing a political economy of food

Abstract: (1994). Constructing a political economy of food. Review of International Political Economy: Vol. 1, No. 3, pp. 547-552.

Some comments on ‘nature’ and ‘society’ in the political economy of food

Abstract: The title of Ben Fine's (1994) paper 'Towards a political economy of food' seems, at first glance, innocuous enough. It infers that we are to be coaxed towards a political economy approach but are unlikely to arrive at a 'full-blown' theoretical 'position'. However, for those familiar with social science work on agriculture and food, the 'towards' may seem a little puzzling. For well over ten years now the food system has been subjected to critical analysis and much of this work has been undertaken within an explicit political economy perspective. A paper with such a title might, therefore, allow a welcome assessment of progress to date. However, Fine provides a selective reading of the food systems literature rather than a full-scale review. His aim seems to be to inject some 'rigour' into a set of approaches which, in his view, have come to be tainted by theoretical and empirical 'eclecticism' (p. 522). To facilitate the adoption of a more rigorous approach Fine suggests 'it is imperative to uncover the interactions between structures, tendencies and historical contingency' (p. 521) in the food systems literature. In order to illustrate how these terms have been confused in the past, Fine provides two examples: first, the commoditization debate where the countervailing nature of two tendencies the growing productivity of industrial capital, which undermines the distinctiveness of agriculture, and the provision of cheap inputs to enhance agriculture's prospects has often been ignored; second, the work of Goodman and Redclift, particularly their use of the terms 'appropriationism' and 'substitutionism', which he believes suffers both from biological determinism and a conflation of 'tendencies' and 'trends', precludes the recognition that such tendencies are underlying forces in contradiction with one another. Along the way Fine provides a few suggestions on how things might be done differently. Perhaps most important, he believes we should characterize the food sector as a 'system of provision', that is, a chain of activities extending from the farm (site of primary production) to the home (site of consumption), distinguished from other systems by

The Lomé convention: Assessing a north‐south institutional relationship

Abstract: This paper examines the Lome Convention, an institutional relationship linking the twelve members of the European Community (EC) with sixty‐nine countries from Africa, the Caribbean and the Pacific (ACP). The immediate aim of the paper is to take stock of the EC‐ACP relationship now that Lome has been in effect for nearly two decades and has recently been the subject of extensive renegotiations. More broadly, Lome provides a window on one of the most important processes of the contemporary global system, the growing isolation of large parts of the less developed world from the broader international economy. The paper is divided into three parts. The first describes the major elements of the Lome relationship: preferential access to the EC market for most ACP exports; a compensation scheme for ACP primary product producers who have suffered short‐term declines in their export earnings; and a program of development assistance, including both traditional long‐term project grants and, more recently, ...

Strategic industrial policies in a global industrial system

Abstract: What is the most appropriate framework, the most appropriate economic model, for designing an effective industrial policy? This article examines the evolution of both general policy opinion and economic literature related to this issue. After a brief summary of the tools needed in economics for an appropriate framework of analysis, the first section articulates the latest positions in policy opinion along the spectrum from state interventionism to anti‐regulationism. The section then presents the arguments behind the new trade theory and those of complementary theorizations to help us recognize the importance of the new trade theory as a suitable framework in favour of state intervention. The article states, however, that this is not sufficient, and the second section outlines the merits of an emerging systemic approach. It provides insights beyond the scope of the new trade theory which could serve as a foundation for the design of strategic industrial policies in a global industrial system.

Premature rigour: Or, can Ben Fine have his contingency and eat it, too?

Abstract: (1994). Premature rigour: Or, can Ben Fine have his contingency and eat it, too? Review of International Political Economy: Vol. 1, No. 3, pp. 553-561.

A global industrial policy. US hegemony and GATT. The liberalization of telecommunications

Abstract: In the early 1980s the United States government was instrumental in entering the issue of liberalization of trade in services, and specifically liberalization of trade in telecommunications services onto the GATT agenda. Yet, in 1992 it reversed its policy and excluded basic telecommunications (voice transmission) from GATT. This article seeks to explain this change in policy, arguing that ten years on, because its activities in other international institutions have effectively allowed it to make the gains it originally sought, the US no longer needs GATT in the telecommunications sector.

Soviet and East European ‘socialism’: A review of the international political economy on what went wrong

Abstract: What went wrong in the socialist East? The usual answers range from 'everything' by opponents to only 'Stalinism' or even 'nothing' according to erstwhile believers and/or supporters. The answers cover policies or ideologies and periods ranging from the first Soviet government and revolution in 1917 (or even earlier from the birth of Marxism in 1848) to those of the last government and reforms of Mikhail Gorbachev since 1985. About this last Soviet period also, the answers range from the 'if it ain't broken, don't fix it' position of those who thought nothing much was wrong to that of pronouncing the whole 'system' as unworkable. Many critics in between, like Gorbachev (1987) himself, recognized failures and the need for some change like perestroika, but not complete transformation. Other critics, however, regard Gorbachev's reform efforts to fix things as themselves misguided and literally counterproductive. Some of these critics argue that were it not for Gorbachev's own policy errors, the Soviet Union and its economy could have survived for some time if not indefinitely. Among these critics are Ellman and Kontorovich (1992) and Menshikov (1990, 1992), to whom we return below.

Going lean or going native? The social regulation of ‘lean’ production systems

Abstract: The experience with Japanese or ‘lean’ production systems when trans‐’ planted to the West has often been below expectations. This article reviews some of this experience and the surrounding debate. Adopting a theoretical position akin to that of the Regulation School, we argue that production systems need to be understood from within the wider sociocultural context in which they have been embedded. We next examine five critical features of the Japanese production system and their modus operandi within Japanese society. We submit that the sociocultural context creates and is reproduced by psychological factors, in particular a concept of self which is arguably different from that which drives the motivations of Western homo economicus. A concluding section explores to what extent, in the West, information technology is accompanied by an organizational function that may replace the role of indigenous social structure in Japanese production systems.

Is the Japanese economy in crisis

Abstract: Although the Japanese economy is often seen as exempt from the crisis, it also has experienced wild business fluctuations and prolonged depressive industrial difficulties since 1973 much in common with other capitalist countries. Beginning from the preceding period of high economic growth, this paper examines the origins and the changing phases of the economic crisis in Japan. Then it analyses the factors for its persistent depression, such as a structural tendency to labour shortage, a competitive pressure by means of ME information technologies, and the difficulties of exporting industries. Despite its seeming strength in appreciated yen, trade surplus, and improved productivity in manufacturing, real wages have been effectively stagnant, and the social position of workers weakened. Economic unevenness has increased in many aspects, while the budget crisis has deepened. Thus, the seeming strength of the Japanese economy is actually coupled with distortion of its structure by exhausted and weake...

The collapse ‐ An internal or external problem? A critique of Frank's approach

Abstract: I have three main objections to Frank's paper which are as follows: First, the author's description of the development of the socialist system is extremely one-sided. In fact, he completely rejects any explanations and factors related to the internal nature and characteristics of socialism, and overemphasizes the significance of external factors related to the world economy. For him, 'socialism' is only the less developed, backward area of the global economic system. He makes a few general remarks about internal factors and their possible significance; this does not, however, change my assessment of his position, as they only make it somewhat less extreme. Second, Frank seeks to give an account of 'real world economic factors' and refrains from analysing ideological or political ones; nowhere does he explain his understanding of the relations between economy, polity and ideology. Therefore, it seems that for him these spheres of reality exist in complete isolation and there is no need to consider the economic consequences of ideological phenomena. Third, Frank very often makes general statements (for example, concerning similarities between the development of some part of Central and Eastern Europe and Western Europe, or the impact of 'socialist development' on the economic standing of various East European regions in relation to each other and to Western Europe) without providing any proof or statistical evidence. Some of these statements may perhaps be intellectually stimulating, but they lack scientific rigour. I am especially doubtful about comparisons between Eastern Europe and the Third World (Latin America, Africa). For example, it is certainly wrong to claim that the economic policy of the Jaruzelski regime like that of the Sandinistas in Nicaragua involved the implementation of an IMF-style programme. I doubt the relevance of this comparison and the validity of this claim with respect to Poland. Let me elaborate upon my arguments, which concern in particular Frank's approach. Reductionism is one of the main errors to be avoided in describing the socialist system with only one factor (or group of

A response to my critics

Abstract: Variously described as opaque, extremely and a little dubious, bizarre, insulting, unclear, loose and vague, weakly developed, deceptively innocuous, a little puzzling, rather banal, lacking in novelty and revelation, subject to the deterministic heresy, prone to unsupported claims, eclectic, confusing, arbitrary, and having my contingency cake and eating it, it is worth emphasizing how much I am indebted to the literature to which many of my critics have contributed and continue to contribute so invaluably. Consequently, we have much in common, and this should not be overshadowed by the substantive differences, and lapses in clarity and interpretation, that might seem to divide us. In this response, I wish both to acknowledge and rebut the criticisms aimed at 'Towards a political economy of food'. Specifically, a food system approach is perceived as invaluable, if not beyond reproach, certainly as against the orthodox approaches based upon more or less formal models of supply and demand; it includes an emphasis on structures, tendencies and historical and social contingency; food is distinguished but not determined by its unique organic, biological or natural significance (the human species is a conscious, purposeful animal); the reproduction and transformation of the food system potentially occurs integrally along the range of its activities, as analytically addressed, for example, by the notions of appropriationism and substitutionism; the global, the cultural and the state are crucial. Murdoch and Watts appear to take our systems of provision approach to consumption, and to food in particular, as excluding cultural determinants and effects from the food system. This is wrong. In this context, it is important to recognize that our work has been driven by the wish to identify and explain socioeconomic patterns of food consumption (for Great Britain from data taken from the National Food Survey, and to which an office full of computer printouts testifies). Consequently, along with consumer food activists,' we have analytically followed the journey through the food system in the opposite direction from most of my critics, who have traced a path out of the political economy of agriculture, emerging with a blink into the dazzling and unaccustomed glare of consumption.2

The social organization of production, competitive advantage and foreign investment: American automobile companies in the 1920s and Japanese automobile companies in the 1980s

Abstract: This paper compares the establishment of American assembly plants in Europe during the 1920s and the establishment of Japanese assembly plants in North America during the 1980s. It argues that these were similar in a number of respects, most importantly that the basis of the American advantage of the 1920s and the Japanese advantage of the 1980s was, in fact, the same, namely, a specific social organization of production: Fordism for American companies and 'lean production' for Japanese companies. It is also shown that the same factors which obstructed the dissemination of Fordism in Europe during the 1920s, the resistance of management and labor, have obstructed the dissemination of the Japanese system in North America during the 1980s. The concluding section argues that the general trajectory of American automobile companies in Europe during the 1930s may provide insights into the general trajectory of Japanese companies in the US during the 1990s. Foreign assembly has always been an important strategy for automobile producers. Before 1910, Ford and General Motors assembled cars in Canada and Europe, and Daimler and Fiat contemplated assembly in the United States. Since then, many auto companies have built and operated foreign assembly plans with varying degrees of success. Some of these plants have endured but there are as many, if not more, instances where foreign assembly, especially in the core nations of the world economy, was a brief, unsuccessful experiment. While the decision to open a foreign assembly plant is specific to companies, their foreign markets, and distinct eras in the world economy, some general observations about foreign assembly in the

What went wrong with Andre Gunder Frank

Abstract: (1994). What went wrong with Andre Gunder Frank. Review of International Political Economy: Vol. 1, No. 2, pp. 345-350.

On the demise of European socialism: Andre Gunder Frank and international political economy

Abstract: Thousands of works will be written on the demise of 'real, existing socialism' in Europe. The mere trickle we now see is best explained by the fact that theories of international politics and political economy are unequal to the task. The various missions, political and economic, making pilgrimages to the East carry with them 'solutions' based on theoretical frameworks that could not enlighten us as to the timing or in many cases the reasons for the crisis. The rest of the academy remains strangely quiet. Few predicted this turn of events, and popular/ ideological pronouncements provide little basis for analysis. A few representatives of major schools of thought are proclaiming some form of victory, though they do so neither loudly nor clearly. Into the muddle steps Andre Gunder Frank with a world system explanation of 'what went wrong'. Frank's perspective includes a single world system driven by capital accumulation, bifurcated into center and periphery, and punctuated by economic cycles of prosperity and crisis, and political cycles of hegemonic leadership and rivalry. Rejecting arguments based on ideological differences, Frank suggests that the socialist bloc adopted much the same strategy for economic growth as the rest of the periphery, and subsequently fell prey to a global economic crisis. As Latin American, African and some Asian countries declined, so did those of Eastern Europe. The USSR was affected through its relations with Eastern Europe, through the crisis-driven arms race that began in 1979, and by policy miscalculations in places like Afghanistan. Frank's analysis is superior to those offered by other major schools of thought, none of which fared as well as world system analysis. Frank's identification of historical continuities also provides a sense of perspective missing from other analyses. In the areas of crisis dynamics, of the similarities between eastern and southern economic policies, and as regards linkages between global and local phenomena, Frank's arguments are in need of additional support. Finally, I take issue with the four