Latin American Economic Development



INTERNATIONAL RELATIONS 330

POLITICS OF THE WORLD ECONOMY

Prof. Carol Wise

Fall Semester 2016

T-TH 11:00-12:20 VKC 152

Office Hours: TH 3:30-5:00 pm

Office: VKC 328

Phone: 213-740-2138

E-mail: cwise@usc.edu

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 book is required and can be purchased at or at the USC bookstore: Global Political Economy: Theory and Practice, by Theodore Cohn (New York: Longman, Seventh Edition, 2016). 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. 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

August 23: Overview

August 25: Markets and Politics

Theodore H. Cohn, Global Political Economy: Theory and Practice (New York: Longman, Seventh Edition, 2016), chapter 1.

Jeffry Frieden, David Lake, and Lawrence Broz, “Introduction,” in 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

August 30: 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.

September 1: The Debacles

Film: “Inside Job”

WEEK 3: Contending Theoretical Perspectives

September 6: Liberalism versus Realism

Theodore H. Cohn, Global Political Economy, chapter 3.

Theodore H. Cohn, Global Political Economy, chapter 4.

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.

September 8: The 19th Century and the First Wave of Globalization

Film: The Industrial Revolution



THE HISTORICAL BACKDROP

WEEK 4: Trade & Finance in the 19th Century

September 13: 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.

September 15: 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.

Jeffry Frieden, David Lake, and Kenneth Schultz, World Politics: Interests, Interactions, Institutions, chapter 9. PDF posted on Blackboard.

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

September 20: 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

Jeffry Frieden, David Lake, and Kenneth Schultz, World Politics: Interests, Interactions, Institutions, chapter 1. PDF posted on Blackboard.

September 22: The Great Depression and Inter-War Years

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

September 27: Introduction to the Bretton Woods Order

Theodore H. Cohn, Global Political Economy, chapter 2.

September 29: World War II & After

Film: World War II---Cause and Effects

WEEK 7: Crafting a Regime for International Trade

October 4: From the GATT to the World Trade Organization

Theodore H. Cohn, Global Political Economy, chapter 8.

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.

October 6: Regionalism and the Resort to Bi-lateral Trade Deals

Theodore H. Cohn, Global Political Economy, chapter 9.

Carol Wise, “Playing both Sides of the Pacific: Latin America’s Free Trade Agreements with China,” Pacific Affairs, vol. 89, no. 1 (2016): 75-101. PDF posted on Blackboard

WEEK 8: Midterm Exam

October 11: Exam Review

October 13: Midterm Exam

Week 9: International Trade & Student Presentations

October 18: Multilateralism on the Wane?

CASE STUDY: The North American Free Trade Agreement (NAFTA)

Carol Wise, The North American Free Trade Agreement, New Political Economy, no. 1 (2009). PDF posted on Blackboard

C. Wise, “Unfulfilled Promise: Economic Convergence under NAFTA,” in M. Studer and C. Wise, eds., Requiem or Revival: The Promise of North American Integration (Washington, DC: Brookings Institution, 2007). PDF posted on Blackboard

October 20: Free Trade Areas and the Departure from Multilateralism

• Why did the Doha Round fail? (1)

• The Trans-Pacific Partnership (TPP): What and why? (2)

• Why have both U.S. presidential candidates rejected free trade agreements? (3)

WEEK 10: Bretton Woods & Global Monetary Relations

October 25: A Regime for International Finance

Theodore H. Cohn, Global Political Economy, chapter 6.

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

Jeffry Frieden, David Lake, and Kenneth Schultz, World Politics: Interests, Interactions, Institutions, chapter 8. PDF posted on Blackboard.

October 27: Post-Bretton Woods

Film: Too Big to Fail

WEEK 11: Financial Crises - Post-Bretton Woods

November 1: The 1982 Debt Crisis

Jeffry Frieden, Debt, Development, and Democracy (Princeton, NJ: Princeton University Press, 1991), pp. 42-66.

November 3: Financial Crises and the ‘Great Recession’

Theodore H. Cohn, Global Political Economy, chapter 7.

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

PDF posted on Blackboard.

WEEK 12: Student Presentations on International Finance

November 8: Emerging Markets and Financial Crises

• The Asian emerging economies: comparing the 1997-98 crisis with 2008-09 (4)

• What is the “Greek crisis” and why has it lasted so long? (5)

November 10: Is the ‘Great Recession’ Behind Us?

• What role did China play to prevent a repeat of the Great Depression in the 1930s? (6)

• Why have U.S. interest rates been hovering around “zero” since December 2008? (7)

• Brexit: Definition & Explanation (8)

WEEK 13: Multinational Corporations in the World Economy

November 15: 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.

Theodore H. Cohn, Global Political Economy, chapter 10.

Jeffry Frieden, David Lake, and Kenneth Schultz, World Politics: Interests, Interactions, Institutions, chapter 7. PDF posted on Blackboard.

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.

November 17: Student Presentations on Multinational Corporations

• What is the ‘new logic’ to global production? (9)

• Is the new Asian Infrastructure Investment Bank (AIIB) a good idea? (10)

Week 14: THANKSGIVING BREAK

Week 15: Pivotal States & the Development Backlog

November 29: The Rise of “the Rest”

Theodore H. Cohn, Global Political Economy, chapter 11.

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

Barry Naughton, “A Political Economy of China’s Economic Transition,” in L. Brandt and T. Rawski, eds, China’s Great Economic Transformation (Cambridge, UK: Cambridge University Press, 2008). PDF posted on Blackboard

Carol Wise and Maria Antonieta Lins, “Macroprudence versus Macroprofligacy: Brazil, Argentina, and the Global Financial Crisis,” in C. Wise, L. Armijo, and S. Katada, eds., Unexpected Outcomes: How Emerging Economies Survived the Global Financial Crisis (Washington, DC: Brookings, 2015).

December 1: Student Presentations on the Development Backlog

• The tenacity of poverty and income inequality (11)

• Who would benefit from immigration reform in the US? (12)

Final Exam: Tuesday, December 13, 8-10 am

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