This is a preview of a newly branded PowerPoint template for the Payson Center.

1. International Political and
Economic Relations
Module 2
Dauphine M. Sloan
September 14, 2014IDEV-6670-01 Fall 2014 1

2. “Grant Writing for Development Projects” Earl Picard, Georgia
State U, 10/18-21
“Development, Commerce & Environmental Protection” Mario
Mancilla, Guatemala, 10/25-27
Management of Global Manmade Waste, Lee Gary, NO, 11/8-10
Microfinance/Microentreprise courses (3 2- an 1- credit
courses), Carter Garber, Winter Intersession, January 2014.
September 14, 2014IDEV-6670-01 Fall 2014 2
Mini-Courses

3. 16th – mid-18th c.: Mercantilism
Mid-18th century – WWI: Industrialization & British Hegemony
Inter-war period: Isolationism
Post-WWII: US Hegemony and International Regimes
“sets of implicit or explicit principles, norms, rules and decision-
making procedures” that intend to regulate each other’s behavior
in such areas as trade, aid, and monetary relations.” [Cohn, 65]
1970s-Present: Globalization & the end of hegemons?
September 14, 2014IDEV-6670-01 Fall 2014 3
History of IPER

4. Adam Smith critical of mercantilism: Why?
Main principles of mercantilism?
Colbert, Louis XIV’s Minister of Finance
September 14, 2014IDEV-6670-01 Fall 2014 4
Mercantilism (1500-1750)

5. Power of the State through wealth accumulation
Priority to exports
Develop external trade
Impose tariff barriers
Manufactures
Les Gobelins (tapestries)
Saint Gobain (glass)
Silk, lace, porcelain
Exports to North America, Middle East, India
Compagnie des Indes Orientales
Triangular Trade
September 14, 2014IDEV-6670-01 Fall 2014 5
Colbertism (1661-1683)

6. Les Gobelins
September 14, 2014IDEV-6670-01 Fall 2014 6

7. Luxury manufactured goods
Raw materials from French trading posts
Africa, Caribbean, Orient
Low cost
No tariff barriers
Finished products exported
North America (Canada, Louisiana)
Middle East
India
Triangular Trade: what is it?
September 14, 2014IDEV-6670-01 Fall 2014 7
Colbertism

8. September 14, 2014IDEV-6670-01 Fall 2014 8
Triangular Trade: mid 15th – mid 19th
centuries

9. 11-15 million slaves sent to the Americas
Official abolition of slave trafficking
British Empire: 1807
Congress of Vienna: 1815
Abolition of slavery
British Territories : 1834
French Territories: 1848
Dutch Territories: 1863
US: 1865
Brazil: 1888
September 14, 2014IDEV-6670-01 Fall 2014 9
Triangular/Slave Trade (1450s-1860s)

10. North-South trading system
raw materials >< manufactured goods
Achieve power through accumulation of wealth
Military means
Coerced trading relationships
Ships  military and economic power
Politics and religion
Treaty of Westphalia (1648)
Missions, hospitals, schools (Jesuits) // political & economic
domination
Hierarchical/Patriarchal order
September 14, 2014IDEV-6670-01 Fall 2014 10
Mercantilism

11. Competitive edge
Trade liberalization
Corn Laws abolished (1815-1846)
Britain = Global Hegemon
Peak: 1870
Controls 24% of global trade
Gold Standard
Gold = measure for convertibility of currencies
Warfare
Benefits?
Costs?
September 14, 2014IDEV-6670-01 Fall 2014 11
Industrialization & British Hegemony
(1750-1914)

12. Britain’s waning hegemony
Over-extension of empire
Competition
WWI Devastation  production/trade decline
UK
1 million dead
1.6 million wounded
Europe
20 million dead
21 million wounded (civilians and military)
September 14, 2014IDEV-6670-01 Fall 2014 12
Isolationism (1914-1939)

13. US largest industrial power: new hegemon?
Great Depression
US: 1929-
Europe: 1930-
Protectionism
Trade barriers
Infant industry
Autarky
Few international organizations: which ones?
September 14, 2014IDEV-6670-01 Fall 2014 13
New World Order?

14. League of Nations (1920-1946)
Peace and cooperation between nations
US out
Bank for International Settlements (1930)
Payment of German reparations
September 14, 2014IDEV-6670-01 Fall 2014 14
Pre-WWII International Institutions

15. Do we have a hegemon?
Why? Why not?
September 14, 2014IDEV-6670-01 Fall 2014 15
Post-WWII

16. Stability
Institution of international structures
War effort
Military equipment  chain of production
Post-War reconstruction  new markets
Assets
Land
Resources
Immigrants
Education and applied research
September 14, 2014IDEV-6670-01 Fall 2014 16
US Hegemony (1940-1970s)

17. Which ones?
Role?
September 14, 2014IDEV-6670-01 Fall 2014 17
International Organizations

18. International Monetary Fund (IMF) – BW, July 1944
Support international monetary stability
Eliminate currency exchange restrictions
Monitor and maintain fixed exchange rates
Provide short-term loans to countries with balance of payment
problems
Weighted voting system
International Bank for Reconstruction and Development
(IBRD) / World Bank – BW, July 1944
Provide long-term loans for post-war reconstruction in Europe and
economic development in the Third World
Weighted voting system
September 14, 2014IDEV-6670-01 Fall 2014 18
International Institutions

19. General Agreement on Tariffs and Trade (GATT) / World Trade
Organization (WTO: 1995- )
Reduce trade barriers
Establish rules for international trade relations
Establish procedures for settling trade disputes
United Nations (San Francisco, 1945)
IMF, WB: “UN Specialized Agencies” (not WTO)
Gold Exchange/Fixed Exchange Rate/Bretton Woods System
(1947)
$35/oz of gold
All BW member-states’ currencies pegged to $
September 14, 2014IDEV-6670-01 Fall 2014 19
International Institutions

20. If you go back to the 1970s, what are the main elements that
would support the thesis of a waning US hegemon?
And in recent years, what factors have threatened US
hegemony? What does that entail for global stability?
September 14, 2014IDEV-6670-01 Fall 2014 20
End of US Hegemony?

21. Emergence of Europe  competition
Size
Economic growth
Increase in trade
US balance of payments deficit
Vietnam war
Dependence on Middle East oil
End of Gold/Fixed Exchange 1971
$35  $160/oz of gold - 12/1975
$1,775/oz - 9/16/2012
$1,326/oz - 9/12/2013
September 14, 2014IDEV-6670-01 Fall 2014 21
Globalization & End of US Hegemony?
(1970s-present)

22. Superpower
Central Planning
Arms Race
Perestroika and Glasnost’
Bankruptcy
September 14, 2014IDEV-6670-01 Fall 2014 22
The Soviet Union: Hegemon?

23. Growing competition from EU and BRICS
Cost of wars
Syria
Globalization of crises
…
What is important in international political and economic
relations?
September 14, 2014IDEV-6670-01 Fall 2014 23
Threats to US Hegemony

24. Is the current global economy stabilized by HEGEMONY or by
REGIMES or by a combination?
2 groups (1. Hegemony; 2. Regimes)
Prepare arguments and counter-arguments
Give specific examples
September 14, 2014IDEV-6670-01 Fall 2014 24
Debate

25. Best relationship among nations
HARMONY (all share same goals) >< DISCORD (war or global
autarky)
Negotiation & policy coordination
International cooperation
many states share many goals
cumulative
Europe
Common Market/European Economic Community
European Community
European Union (1993)
September 14, 2014IDEV-6670-01 Fall 2014 25
Cooperation

26. European Union
Coal and steel agreement: CECA, 1951
Treaty of Rome, 1957
Treaty of Maastricht, 1993  free movement
of people, goods, and capital
Euro, 2002: 17 countries in Euro zone
Treaty of Lisbon, 2009  European
Constitution
2013: 28 members
Should Turkey join?
September 14, 2014IDEV-6670-01 Fall 2014 26