PS2237 Week 10 Readings Summary.docx - Reading 10.1 u2013...

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Reading 10.1 – Robert Gilpin: The Nature of Political Economy I NTRODUCTION Interdependent world economy arising from powerful economic and technological forces Three major treatments of the relationship between economics and politics (i.e. major ideologies of political economy M EANING OF P OLITICAL E CONOMY Relationship between economics and politics is a reciprocal one Politics largely determine the framework of economic activity and channels it in directions intended to serve the interests of dominant groups o However, economic process tends to redistribute power and wealth, transforming the power relationships among groups P OLITICS VS . E CONOMICS Charles Kindleberger o Two different methods of allocating scarce resources Politics : Market mechanism Economics : Budget Keohane and Nye o Levels of analysis Politics (Structure) : Having to do with the establishment of an order of relations and structure Economics (Process) : Short-term allocative behavior o Flaw : Tends to isolate economic and political phenomena except under certain conditions This study: o Politics : Realm of power o Economics : Takes as its province the creation and distribution of wealth P OWER Basic concept of political science is power o Power is not the sole/principal goal of state behaviour o Welfare, security and prestige are the goals o Power in its various forms (psychological, military, economic) is simply the means of achieving these goals o Distribution of power is important because it affects the ability of states to achieve what they perceive to be their interests Power has a psychological dimension – manipulation of perceptions of other statesmen regarding the distribution of power Power can take many forms – military, economic, psychological and most importantly, force Page 1 of 20
T HREE C ONCEPTIONS OF P OLITICAL E CONOMY Liberalism Marxism Mercantilism Nature of economic relations Harmonious IPE = positive-sum game (i.e. absolute gains) Assumes basic harmony between true national interest and cosmopolitan economic interest State should not interfere with economic transactions across national boundaries Free movement of commodities, removal of restrictions on flow of investment, IDL will allow everyone to benefit in the long run because of a more efficient economy Conflictual Premise that the essence of economic relations is conflictual No underlying harmony Focuses on relative gains (i.e. zero-sum game) Nature of the actors Households and firms Rejects mercantilists’ view State represents an aggregation of private interests Public policy is the outcome of a pluralistic struggle among interest groups Economic classes Interests of the dominant class determine the state’s FP State = executive committee of the ruling class, public policy reflects its interests Nation-states National interest determines FP NI may be influenced by economic interests of classes, factors of geography, external configurations of power and national survival State = organic unit in its own right

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