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57 Cards in this Set

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International Political Economy
where power and money cross borders
distribution and production of power, order, and justice
distribution and production of money and goods
mercantilism and realism
states should reduce vulnerability and maximize wealth by domestically producing as much as possible (export, but try not to import.)
-Create surplus stocks of goods and currency
-use accumulated wealth to promote industrial development and strengthen government/army
-Similar to realism
-states need to be strong and secure (reduce vulnerability)
liberalism and IPE
State is not as importans. IOs and MNCs are also key (aid interstaet commerce). State poweris limited by the incredible interdependence in the international system.
relative gains
stressed by mercantilists. States can use their wealth against you, therefore you need to get MORE than them! If you trade and it is an even trade then no one wins
marxist IPE
against liberals: social harmony (absolute gains) can not exist.
against mercantilists: states are not unitary actors.
economic warfare
At the most extreme of economic coercion one state can cut off another states from the whole economy. Not common.
cut off one state from some of the goods you produce or do not let one or some of their goods into your domestic market.
absolute gains
states are not always going to use wealth agains you. As long as you get something out of a transaction, you are gaining absolutely(shiny happy people)
economic coercion
influence another state to do something or stop doing something
Geo economics
Where conflict could break out into politico-military conflict. Now it makes much less sense to fight(nuclear obliteration), therefore we will see "weapons of commerce". More realist/mercantilist than liberal
Iron Triangle
Iron triangle is a phrase typically used by American political scientists to describe what are deemed to be cosy relationships in U.S. politics between the legislature, government bureaucracies, and constituencies; which ultimately result in very tight policy-making circles.
Central to the issue of iron triangles is the assumption that bureaucratic agencies, as players in the political game, seek to create and consolidate their own power base. The idea is that an agency's power is determined by its constituency, not by its consumers. For these purposes, constituency may be defined as a group of politically active members sharing a common interest or goal; consumers are the expected recipients of goods or services provided by government bureaucracies (often identified in an agency's written goals or mission statement).
follow-on imparitive
as one company stops producing a weapon it gets a new weapons contract
-reason: mercantilitsts would suggest that you need to keep many defense contractoes in business in case a war breaks out (do not want to depend on someone else for vital weapons system)
Private goods
these goods are excludable (rejected) and divisible(can be divided), the market can work with private goods
Collective/Public goods
market does not work here very well, no payoff for producing underproduced good
collective/public goods, if a good is supplied to any one person an additional person being supplied doesn't reduce the quality of the collective good
Jointness of supply
collective good, if a good is supplied to any member of a group it is supplied to all the members of that group
free riders
those that benefit from a collective good without having to contribute to it
-ex: Vaccinations:those that live in a highly vaccinated country that do not get vaccinated....or.... those that do not fight in a war, but benefit from victory...or...countries that benefit finternations environmental laws but do not contribute to them
***worst when they think they can get away with it
public good production
AKA-how to get your roomates to take out the trash
-coercion(are you bigger than they are?)
-rewards/side payments (do they like pizza?)
ceratin rules are better at public good provision than others
-if your roomate dosnt take out the trash you wont clean the bathroom
-if your roomate cleans the bathroom, you will take out the trash
-conditional punishment and reward
-only works when there are future interactions
rules to overcome the free rider problem
"set of rules that govern behavior in some specified area of international relations"
EFFECTS: regularize behavior, creation of patterns and consistent expectations
monetary regimes
help atates manage their exchange rates, maintain reserve currencies used for exchange, and regulate movement of capital.
Global Agreement on Tarrifs and Trade...based on freetrade and nondiscrimination
-institutionalized discussions and meditions
-talks on trade discussed in "rounds"
BIGGEST PROBLEM: domestic politcal pressure to protect homegrown business
SUCCESSES: growth in trade, greater membership(from 23-123) creations on World Trade Organization WTO
FAILURES: US trade deficit, domestic pressure towards protectionism, Uneven development
regional economic integration
create larder domestic markets. bigger may be better(domestic demand, less vulnerable to other countries policies)
GOAL: create a single market out of many markets
command economics
where government makes production decisions
Government intervention
contries try to correct market failure that no on private producer will create because nobody can make money at it.
EX: basic science, national defense, public health, and building roads are examples
intervention tools
Do it yourself tax and spend: build roads

Centralized R and D: National Science Foundation

Subsidize research(tas breaks and grants)
govt purchases

Regulatory protection... outlaw foreign compitition
Industrial Policy
the support of an industry or industries by the government.
how quickyl do the behaviors of other actors or developments in one part of the world, affect actors in other parts of the world and how big are these changes
costs imposed on a state by external events these costs must be absorbed because alternatives policy options are unavailable
self-sufficiency, providing within your borders everything you can
only stronger power gains`
mutual gains
dependency theory
structured inequality
have resources but no way to process them (Ghana, Somalia)
includes nations that are not core countries - capitalist or industrialized nations.
middle ground (korea)
They are major exporters of minerals and agricultural goods. They major in manufacturing, but still have a lot of unmanaged poverty. They tend to be bigger in land mass like Russia and China which is why they are so attractive to the Core countries because they are a 'big' market.
extract resources from the poorer states (US, EU)
the core is a feasible allocation in an economy that cannot be improved upon by any coalition of consumers.

The core exploits the semi-periphery and the periphery, but the semi periphery is needed stabilize the system. It absorbs the shock between the poor and the rich sector. They act as a political buffer - without them there would be political crises.
realism interdependence
we need to maintan domestic industries and be self-sufficient as much as possible, especially in strategically important products and commodities.
liberalism interdependence
By becoming more integrated we have opportunities to foster cooperation between states. Anarchy is not so dire that a lot of cooperation couldnt take place and we can profit from the exchange. More interdependence in trade means we can all be better off, absolute gains.
A tariff is a tax on imported goods. When a ship arrives in port a customs officer inspects the contents and charges a tax according to the tariff formula. Since the goods cannot be landed until the tax is paid it is the easiest tax to collect, and the cost of collection is small. Smugglers of course seek to evade the tariff.
non-tariff barriers
are restrictions to imports but are not in the usual form of a tariff.
criticized as means to evade free trade rules such as those of the WTO, the EU or NAFTA that restrict tariffs.
also be in the form of manufacturing or production requirements of goods, such as how an animal is caught or a plant is grown, with an import ban imposed on products that don't meet the requirements. Examples are the European Union restrictions on genetically modified organisms or beef treated with growth hormones.
one kind of good (or service) is said to be a substitute good for another kind insofar as the two kinds of goods can be consumed or used in place of one another in at least some of their possible uses. margarine and butter, or petroleum and natural gas The fact that one good is substitutable for another has immediate economic consequences: insofar as one good can be substituted for another, the demand for the two kinds of good will be bound together by the fact that customers can trade off one good for the other if it becomes advantageous to do so. Thus, an increase in price for one kind of good (ceteris paribus) will result in an increase in demand for its substitute goods, and a decrease in price (ceteris paribus, again) will result in a decrease in demand for its substitutes.
free market
a controversial model of an idealized economy, wherein exchanges are "free" of all coercive measures, including such government interference as tariffs, taxation, and regulations
market failure
a situation in which markets do not efficiently organize production or allocate goods and services to consumers (for example, a failure to allocate goods in a way some see as socially or morally preferable).
the economic policy of restraining trade between jurisdictions, through methods such as high tariffs on imported goods, restrictive quotas, and anti-dumping measures, in an attempt to protect producers in a particular locale from competition. This contrasts with free trade, where no artificial barriers to entry are instituted to prevent competition.
an action undertaken to abstain from using, buying, or dealing with someone or some organisation as an expression of protest or as a means of coercion.
the prohibition of commerce and trade with a certain country.

It is usually declared by a group of nations against another one, in order to isolate it and to put its government into a difficult internal situation, given that the effects of the embargo are often able to make its economy suffer from the initiative.

The embargo is usually used as a political punishment for some previous disagreed policies or acts, but its economical nature frequently leaves space enough for doubts about the real interests that the prohibition gives advantage to.
refers to the worldwide phenomenon of technological, economic, political and cultural exchanges, brought about by modern communication, transportation and legal infrastructure as well as the political choice to consciously open cross-border links in international trade and finance. It is a term used to describe how human beings are becoming more intertwined with each other around the world economically, politically, and culturally
In international law, the process by which different states adopt the same laws.
As a result of the operation of international treaties, the regulatory principles of stronger states are often (but not always) transplanted into weaker ones
The Organisation for Economic Co-operation and Development (OECD) is an international organization of those developed countries that accept the principles of representative democracy and a free market economy.
Modernization theory
a socio-economic theory, sometimes known as (or as being encompassed within) development theory, which highlights the positive role played by the developed world in modernizing and facilitating sustainable development in underdeveloped nations, often contrasted with dependency theory.
Import substitution industrialization
also called ISI is a trade and economic policy based on the premise that a developing country should attempt to substitute products which it imports, mostly finished goods, with locally produced substitutes. The theory is similar to that of mercantilism in that it promotes high exports and minimal imports to increase national wealth.

The policy has three major tenets: an active industrial policy to subsidize and orchestrate production of strategic substitutes, protective barriers to trade (namely, tariffs), and a monetary policy that keeps the domestic currency overvalued. Hence import substitution policies are not favored by advocates of absolute free trade.
Export-led Industrialization
a trade and economic policy aiming to speed-up the industrialization process of a country through exporting goods for which the nation has a comparative advantage. Export-led growth implies opening domestic markets to foreign competition in exchange for market access in other countries.
micro lending
Microcredit is the extension of very small loans, by the government, to unemployed, poor entrepreneurs and others living in poverty who are not bankable.
military-industrial complex
refers to the combination of the U.S. armed forces, arms industry and associated political and commercial interests, which grew rapidly in scale and influence in the wake of World War II, although it can also be used to describe any such relationship of industry and military. It is sometimes used to refer to the iron triangle that is argued to exist among weapons makers/military contractors (industry), The Pentagon (military), and the United States Congress (government).
Iron triangle Dynamics
In the United States, bureaucratic power is exercised in U.S. Congress, and in congressional committees and subcommittees in particular. By aligning themselves with constituencies, bureaucracies are able to affect policy outcomes directly. This is where iron triangles manifest themselves. The picture below displays the concept.

At one corner of the triangle are interest groups (constituencies). These are the powerful interests that buy Congressional votes in their favor and which guarantee re-election for supporting their programs. At another corner sit members of Congress who also seek to align themselves with a constituency for political and electoral support. These congressional members support legislation that advances the interest group's agenda. Occupying the third corner of the triangle are bureaucrats, who are often captured by those they are designed to regulate. The result is a three-way, stable alliance that is sometimes called a subgovernment because of its durability, impregnability, and power to determine policy.

Consumers are often left out in the cold by this arrangement. Iron triangles result in the passing of very narrow, "pork barrel" policies that benefit a small segment of the population. The interests of the bureaucracy's constituency are met, while the needs of consumers (which may be the general public) are passed over. This "privatization" of public administration may be viewed as problematic for the popular concept of democracy, insofar as the common welfare of all citizens is sacrificed for very specific interests; effectively subverting the purpose for which the agency was established in the first place. Others maintain that such arrangements are consonant with (and natural outgrowths of) the democratic process, since they frequently involve a majority bloc of voters implementing their will through their representatives in government.