Globalization

Global Governance
 Global or International Political
Economy (Economic Liberalism, Neoliberalism,
Capitalism, Mercantilism)
Definition of Global Governance
Global governance is a broad, dynamic and complex
process of interactive decisionmaking at the global level
that involves formal and informal mechanisms as well as
governmental and non-governmental bodies. States and
governments remain the primary institution for
articulating public interests and those of the
global community as a whole, but global governance also
involves intergovernmental and, sometimes, supranational
bodies.
 Role of the State

 A multitude of factors has created enormous pressure on the existing media and
telecommunications legal systems, although three stand out – globalization; the rise
of international organizations; and technological change.
The state is affected by the emergence of multinational corporations,
nongovernmental organizations and the trends towards liberalization and
commercialization. National governments maintain a significant amount of
autonomy to shape national policy agendas and meanwhile continue to influence
decisions in the international environment. The modern state retains a considerable
degree of control over media flows within its territory, issues binding laws and uses
legitimate force to ensure compliance. In the end, it is the nation-state that decides
which objectives to prioritize and consequently under which regulatory conditions
the media will perform.
Theorizing the process to governance and the role of the nation-state

International bodies, network power and civil society all interrelate and wield influence alongside
the nationstate when it comes to communications policy-making. Keohane and Nye (1998)
attempted to theorize this interdependence in the field of international relations and defined it as
reciprocal effects among actors resulting from ‘international transactions – flows of money, goods,
people and messages across international boundaries’. The authors addressed the issue by
discussing changes in the global environment resulting from the information age. Their work goes
deep into ‘complex interdependence’ by arguing that the world is becoming increasingly
‘information interdependent’ and by attempting to apply the assumptions and concepts present in
complex interdependence to the information age.
This process to governance and the resulting ‘complex interdependence’
in the information era brings more activities into an international agreements framework. The
process to governance is viewed as synonymous with reduced state power, for national
governments are now but one player among many in the domestic and international arena.
Referring to the UK, Rhodes used the expression ‘the hollowing out of the state’ to describe the
impact of supranational bodies on the states or power flow upwards from the central state to a
supranational tier of government.
IPE examines the interdependence of politics and
economics in the international system.
• Like political economy, it views political and
economic reality as two sides of the same coin.
•In other words - Politics and Economy are
Interconnected
• The market can be restricted by politics.
Restrictions derive from values and goals of states.
States may impose restrictions on economic
exchange for the sake of security or for moral
considerations.

• Just as economics cannot be divorced from

Neoliberalism
Distinct from liberalism insofar as it does not advocate laissez-faire economic
policy but instead is highly constructivist and advocates a strong state to bring
about market-like reforms in every aspect of society.
Mercantilism
• Parallel to the realist school of international relations.
• Emphasizes that states participate in the international
economy by pursuing their interests based on calculations of
gains from economic decisions relative to other states.
• Participation in the international system is viewed as a zero-
sum game.
• Foundations: Thomas Mun
Mercantilism
The philosophy that economics and politics are related, that politics should come first, and
that economic activity should serve the interests of the state. States should also protect their
own industries with restrictions on imports such as tariffs, which are taxes on imports that
make them more expensive and thus less attractive to consumers, so that profits stay at home
and the country does not grow too dependent on foreign sources. There are a variety of
methods of protectionist policies in addition to subsidies and tariffs. States can, for example,
impose import quotas on goods (limiting the number of goods that can be imported into a
country), place health and safety regulations on imported goods (making it difficult for
imported goods to meet these standards), and engage in dumping (selling goods abroad for
less than they are sold at home).

Capitalism
A system of generalized commodity production in which wealth is owned privately and
economic life is organized according to market principles.
Hegemonic Stability Theory
• Submits that international order and stability can be
achieved only if there is a hegemonic power in the
system.
• Hegemons act as providers of (international) public goods.
• They also serve to help overcome collective action
problems in the international system.
• Hegemons need not act benevolently; they may even act self-
interestedly.
World Systems Theory
• Related to the Dependency school of thought in
international relations.
• Core-Periphery model of the international economy.
• The world is divided into a core set of capitalist developed
countries upon which less-developed periphery and
semiperiphery countries are dependent.
• Foundations: Karl Marx and Immanuel Wallerstein
 Making of the Bretton Woods system
 In August 1944, the USA, the UK and 42 other states met at the UN Monetary
and Financial Conference at the small resort town of Bretton Woods, New
Hampshire, to formulate the institutional architecture for the postwar
international financial and monetary system. The most significant outcome of
the Bretton Woods process was the establishment of three new bodies,
collectively known as the ‘Bretton Woods system’:
 The International Monetary Fund (IMF), which came into operation in
March 1947.
 The International Bank for Reconstruction and Development (IBRD),
better known as the World Bank, which came into operation in June 1946.
 The General Agreement on Tariffs and Trade (GATT), which was replaced
by the World Trade Organization (WTO) in 1995. Although GATT is usually seen
as part of the Bretton Woods system, it was created by the UN Conference on Trade
and Employment and came into operation in January 1948.
 Making of the Bretton Woods system
 The key idea of classical political economy is the belief that unregulated market competition tends
towards long-term equilibrium. The economy thus works best when left alone by government, and this
supposedly applies at the international level as well as at the national level. Bretton Woods, on the
other hand, was shaped by the fear that an unregulated international economy is inherently unstable
and crisis-prone, tendencies most dramatically demonstrated by the Great Depression itself. In line
with the ideas of J. M. Keynes, markets therefore had to be ‘managed’. The growing influence of such
thinking in domestic politics was reflected in the postwar period in the gradual adoption by all
industrialized states of Keynesian techniques of economic management, in which fiscal policy
(government spending and taxation) was used to deliver growth and keep unemployment low. Bretton
Woods reflected an attempt to establish a Keynesian-style regulative framework for the international
economy.
 Discussions and Video Material

 https://www.cnbc.com/2019/05/02/joseph-stiglitz-on-the-next-recession-trump-china-and-the-wto.html