Latin American Economic Development

INTERNATIONAL RELATIONS 330 POLITICS OF THE WORLD ECONOMY

Prof. Carol Wise Spring Semester 2016 T-TH 2:00-3:20 VKC 152 Office Hours: TH 3:30-5:30 pm Office: VKC 328 Phone: 213-740-2138 E-mail: [email protected]

This survey course provides an overview of those conceptual approaches, critical turning points, and key issues that have characterized the international political economy (IPE) since the first wave of globalization in the 19th century. The main features of the course include: a comparison of the two waves of globalization in the 19th and 20th centuries; a detailed analysis of the political economy of the inter-war years; an examination of the post-World War II Bretton Woods era, including the design of formal rules and institutions to oversee heightened flows of international trade and finance; and, a review of those main themes that have dominated more recent political economy debates. The latter will cover, for example, the proliferation of regional trade and investment agreements, the eruption of numerous financial crises, the changing profile of multinational corporations and foreign direct investment, and those political economic challenges intrinsic to the early 21st century.

COURSE REQUIREMENTS:

 Completion of all assigned readings prior to each meeting. The following three books are required and can be purchased at Amazon.com or at the USC bookstore: World Politics: Interests, Interactions, Institutions, Jeffry Frieden, David Lake, and Kenneth Schultz (New York: W.W. Norton & Company, First Edition, 2010); International Political Economy: Perspectives on Global Power and Wealth, edited by Jeffry Frieden, David Lake, and Lawrence Broz (New York: W.W. Norton & Company, 5th edition, 2010), and Global Political Economy: Theory and Practice, by Theodore Cohn (New York: Longman, Sixth Edition, 2012). For those wishing to brush up on some basic economic principles, I recommend the following: Economic Literacy: Basic Economics with an Attitude, by Frederick S. Weaver (New York: Rowman and Littlefield, 2002). All other assigned readings have been posted on Blackboard and can be easily downloaded.

 Your grade will be based on: Attendance and participation in ongoing class discussions (10%); a mid-term exam that will consist of short essay questions (30%); participation in at least one of the group exercises detailed on the syllabus (20%); a final exam that will consist of short essay questions (40%); ONE POINT of extra credit will be granted for participation in the TIRP or JEP programs. If you accrue more than 3 unexcused absences your grade will be reduced by 1 point; more than six unexcused absences will result in a 2 point reduction in your grade, and so on.

 For Disabled Students: Any student requesting academic accommodations based on a disability is required to register with Disability Services and Programs (DSP) each semester. A letter of verification for approved accommodations can be obtained from DSP. Please be sure the letter is delivered to me as early in the semester as possible.

1 DSP is located in STU 301 and is open 8:30 a.m.-5:00 p.m., Monday through Friday. The phone number for DSP is (213) 740-0776.

CLASS SCHEDULE AND ASSIGNED READINGS

WEEK 1: Introduction to the Course

January 12: Overview

January 14: Markets and Politics

Theodore H. Cohn, Global Political Economy: Theory and Practice (New York: Longman, Sixth Edition, 2012), chapter 1. PDF posted on Blackboard.

Jeffry Frieden, David Lake, and Lawrence Broz, eds, International Political Economy: Perspectives on Global Power and Wealth (New York: W.W. Norton & Company, Fifth Edition, 2010), pp 1-19. PDF posted on Blackboard.

WEEK 2: Globalization of the World Economy

January 19: The Debates

Branco Milanovic, “The Two Faces of Globalization,” World Development 31 (2003): 667-683. PDF posted on Blackboard.

Kenneth Scheve and Matthew Slaughter, “A New Deal for Globalization,” in Frieden, Lake, and Broz, eds, International Political Economy: Perspectives on Global Power and Wealth, chapter 30. PDF posted on Blackboard.

Jeffrey Williamson, “Globalization and Inequality, Past and Present,” in Frieden, Lake, and Broz, eds, International Political Economy: Perspectives on Global Power and Wealth, chapter 27. PDF posted on Blackboard.

January 21: Has Globalization Gone Too Far?

Film: “Inside Job”

WEEK 3: Contending Theoretical Perspectives

January 26: Liberalism and its Lasting Effects

Theodore H. Cohn, Global Political Economy, chapter 4. PDF posted on Blackboard.

January 28: Realist Responses

2 Jeffry Frieden, David Lake, and Kenneth Schultz, World Politics: Interests, Interactions, Institutions (New York: W.W. Norton & Company, 2010), pp. xxiii-xxvix. PDF posted on Blackboard.

THE HISTORICAL BACKDROP

WEEK 4: The 19th Century and the First Wave of Globalization

February 2: The Rise of Free Trade

Jeffry Frieden, David Lake, and Kenneth Schultz, World Politics: Interests, Interactions, Institutions, chapter 6. PDF posted on Blackboard.

Peter Gourevitch, “International Trade, Domestic Coalitions, and Liberty: Comparative Responses to the Crisis of 1873-1896,” in Frieden, Lake, and Broz, eds, International Political Economy: Perspectives on Global Power and Wealth, chapter 6. PDF posted on Blackboard.

Cheryl Schonhardt-Bailey, “Free Trade: The Repeal of the Corn Laws,” in Frieden, Lake, and Broz, eds, International Political Economy: Perspectives on Global Power and Wealth, chapter 5. PDF posted on Blackboard.

Film: The Industrial Revolution http://www.youtube.com/watch?v=gGhSeRxSPb8

February 4: The Quest for Financial Stability

Lawrence Broz, “The Domestic Politics of International Monetary Order: The Gold Standard,” in Frieden, Lake, and Broz, eds, International Political Economy: Perspectives on Global Power and Wealth, chapter 13. PDF posted on Blackboard.

WEEK 5: From Boom to Bust---1900-1945

February 9: From World War I to the 1929 Crash

Susan Carruthers. 2001. “International History.” In The Globalization of World Politics, edited by John Baylis and Steve Smith, pp. 63-93. PDF posted on Blackboard

Film: World War I---Cause and Effects

3 February 11: The Great Depression and Inter-War Years

Barrry Eichengreen, “The Political Economy of the Smoot-Hawley Tariff,” in Frieden, Lake, and Broz, eds, International Political Economy: Perspectives on Global Power and Wealth, chapter 2.

Charles Kindleberger, The World in Depression 1929-1939 (Berkeley: University of California, 1986), chapters 1 & 14. PDF posted on Blackboard

Film: Emergence of Modern America---The Great Depression

THE BRETTON WOODS ERA & BEYOND

WEEK 6: World War II & the Institutional Foundations of the Post-War Global Economy

February 16: World War II

Film: World War II---Cause and Effects

February 18: Introduction to the Bretton Woods Order

WEEK 7: Crafting a Regime for International Trade

February 23: From the GATT to the World Trade Organization

Alan Deardorff and Robert R. Stern, “What You Should Know about the World Trade Organization,” in Frieden, Lake, and Broz, eds, International Political Economy: Perspectives on Global Power and Wealth, chapter 23.

February 25: Regionalism and the Resort to Bi-lateral Trade Deals

WEEK 8: Midterm Exam

March 1: Study Day

March 3: Midterm Exam

4 Week 9: Student Presentations on International Trade

March 8: Multilateralism on the Wane?

 What is the Doha Round and why did it fail? (1)  North versus South: What are the differing demands at the negotiating table? (2)  Explain multilateralism (e.g., WTO) versus regionalism (e.g., the European Union) (3)

March 10: Free Trade Areas and the Departure from Multilateralism

 The US-Korea Free Trade Agreement: Why so difficult to negotiate? (4)  The Trans-Pacific Partnership (TPP): What and why? (5)  How do we explain the 2011 China-Costa Rica Free Trade Agreement (FTA) (6)

WEEK 10: SPRING BREAK

WEEK 11: Bretton Woods & Global Monetary Relations

March 22: Crafting a Regime for International Finance

March 24: The Collapse of the Bretton Woods Financial Accords

Barry Eichengreen, Globalizing Capital, chapter 5. PDF posted on Blackboard

WEEK 12: Foreign Debt and Financial Crises

March 29: The 1980s Debt Shocks in Retrospect

March 31: Financial Crises and the ‘Great Recession’

Nouriel Roubini and Stephen Mihm, Crisis Economics (London: Allen Lane, 2010), pp. 86-157. PDF posted on Blackboard.

WEEK 13: Student Presentations on International Finance

April 5: Emerging Markets and Financial Crises

5  The Asian emerging markets: comparing the 1997-98 crisis with 2008-09 (7)  What is the “Greek crisis” and why has it lasted so long? (8)  How Latin American emerging markets survived the 2008-09 global financial crisis (9)

April 7: Is the ‘Great Recession’ Behind Us?

 What is the “Great Recession”? (10)  Why are some financial entities deemed to be “too big to fail?” (11)  How to explain the slow recovery of the entire Eurozone? (12)

WEEK 13: Multinational Corporations in the World Economy

April 12: Drivers of Global Production

Richard E. Caves, “The Multinational Enterprise as an Economic Organization,” in Frieden, Lake, and Broz, eds, International Political Economy: Perspectives on Global Power and Wealth, chapter 9.

Shah M. Tarzi, “Third World Governments and Multinational Corporations: Dynamics of Host’s Bargaining Power,” in Frieden, Lake, and Broz, eds, International Political Economy: Perspectives on Global Power and Wealth, chapter 10.

April 14: Student Presentations on Multinational Corporations

• Is there a ‘new logic’ to global production? (13) • Are ‘green’ investors really motivated by concerns for the environment? (14) • FDI patterns in the 2000s: where is it ‘hot’ to invest? (15)

WEEK 14: Pivotal States

April 19: The Rise of China & India

P. Shankar Jha, Crouching Dragon, Hidden Tiger: Can China and India Dominate the West? (Berkeley: Soft Skull Press, 2010), pp. 188-251, 223-249. PDF posted on Blackboard.

April 21: The Stalling of Brazil and Mexico

Week 15: Student Presentations on the Development Backlog & Review for Final

6 April 26: The Development Backlog

 The Tenacity of poverty and income inequality (16)  Is there a Post-Washington Consensus on development strategy? (17)  Who would benefit from immigration reform in the US? (18)

April 28: Review for Final Exam

Final Exam: Thursday, May 5, 2-4 pm