ULUSLARARASI İLİŞKİLER TEORİLERİ I - Deneme Sınavı - 3

The expansion of Western colonialism, mainly advances in ship design and navigation allowing global trade routes to be established may be considered the roots of both the global economy and of international political economy.

Economic liberalism, economic nationalism and economic structuralism are the three major approaches to international political economy.

Adam Smith argued that the key to national wealth and therefore national power is economic growth, which could be ensured through free trade, free flow of goods, services and investments across borders.

Economic nationalism can be defined as a mixture of trade protectionism and economic planning, with an aim to preserve national interests in the context of world markets. Emerging as a response to economic crises, nationalist movements and enlarged states, nationalists see companies as elements of state power and therefore contributory to state wellbeing. More advanced nations therefore have a competitive advantage and therefore ''infant'' industries must be protected by the state from foreign competition

While the General Agreement on Tariffs and Trade (GATT)was the treaty aimed at promoting liberal economic principles, and established the most comprehensive trade agreement in history, it became a formal institution in 1995 and was renamed the World Trade Organization. The WTO has the task of implementing the Uruguay Round of the negotiations conducted by GATT, serving as a forum for trade negotiations and providing a venue for trade review. It represents the states that conduct over 90 percent of the world's trade.

Despite the relative erosion of its position within the global economy, the United States continues to bear roughly the same major share of the international strategic burden, as it has done before. Yet a critical question in IPE with respect to the issue of hegemony today is whether China will challenge the United States hegemony and threaten the liberal international order. Another is whether Germany will move to establish itself as a hegemon within the European Union.

Liberal economists usually extoll the virtues of MNCs, and even go so far as to arguing that they result in an interdependence in international trade. This, in turn, requires states to put aside their national differences for economic wellbeing, resulting in peace.

Through globalisation and internationalism in the post Cold War era, it was argued that trade discrimination would be a thing of the past. The observable reality indicates that this is not the case, with localised trade agreements such as the EU and NAFTA being established and providing preferential benefits to member states.

It is remarkable that the economic north-south division has not yet led to military conflict, yet many critics see this issue as one main cause for the rise of terrorism in the 21st century as the power imbalance between the northern hemisphere and underdeveloped or developing nations in the southern hemisphere has also previously led to confrontation in the international arena.

According to Keohane, regime theory is a theory for explaining and understanding the international cooperation intending the coordination and harmonization of interest among nations. This definition accurately describes international regime theory, while the other definitions are descriptive of the concept of regime itself.

Based on Krasner's definition of international regime, norms are standards of behavior defined in terms of rights and obligations.

The nationalists also believe that closing off an economy to external influences can be beneficial to growth and economic progress. Thus, economic nationalism can be defined as a mixture of trade protectionism and economic planning, with an aim to preserve national interests in the context of world markets.

Approach                        Representative

Economic Liberalism                   I- Adam Smith

Economic Nationalism                II- Alexander Hamilton

Economic Structuralism             III- Karl Marx

In the late 19th century, the gold standard system was first adopted by the economically-developed nations, under the leadership of the Great Britain, the hegemonic power at that time. The gold standard was a monetary system where a country’s currency or paper money had a value directly linked to gold.

The realist approach based on the prisoner's dilemma emphasizes that possible risks and uncertainties might cause refrain from cooperation while the cognitivist approach implies that regimes would encourage and institutionalize the mutuality of international relations, while the principle of reciprocity would prevent states from defecting from cooperation.

Multinationals have undue political influence over governments, exploit developing nations, and create job losses in their own home countries. In addition, they argue that MNCs tend to develop
a monopoly for certain products, driving up prices for consumers. MNCs are also said to have a detrimental effect on the environment because their operations may encourage land development and the depletion of local resources.

J.J. Rousseau developed the idea of the European federation.

Immanuel Kant introduced the concept of Perpetual Peace.

A world federation of peaceful states was introduced by Kant as a recipe to solve the security demands of states

For utilitarianism, if fundamental institutions are reshaped or reconstructed for providing the highest satisfaction, then it is certain that the society is regulated rightly.