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The Dominance of Liberal Perspectives in International Political Economy

International political economy (IPE) as an academic discipline was born liberal, with the pioneering work of liberal scholars like Karl Deutsch, Ernst Haas, Richard Cooper, and Albert Hirschman.
IPE set sail through the themes of states and markets in a liberal perspective on the changing international order, and the work of Robert Keohane and Joseph Nye marks the distinctive emergence of IPE in the United States.
The existence of a "consensual approach" in IPE endorsed by the American Political Science Association's section on political economy strongly indicates that the field in the US is now dominated by liberals of one form or another.
The dominance of liberal perspectives is much less the case outside of the US, although the influence of American scholarship throughout the English-speaking world means rivals are distinctly minority voices.
The creation of a "global political economy" in the decades since the 1970s is the fruition of a liberal political project which can be summed up as the promotion of "markets and multilateralism."
Liberal perspectives on the global political economy operate from a rationalist epistemology and individualist ontology, with individual interest as the analytic entry point, which in IPE is nearly always material in nature.
Liberals in IPE are also positivist in their epistemology, emphasizing the discovery of causal laws and the wide use of statistical methodologies to falsify hypotheses derived from theory.
Liberal IPE has always maintained a special relationship with its absentee father economics, looking to it particularly as a source of theoretical and especially methodological inspiration.
A common problematic unites liberal perspectives across many substantive fields of inquiry, with liberal analysis beginning from the premise of a universal interest such as a Pareto-efficient trade policy or the public good of a stable open global economy.
Liberal perspectives on the global political economy are organized into three broad categories: the mainstream core of the so-called "American school" of IPE, liberal work on ideas as explanatory variables, and explicitly normative work on evaluating and prescribing policy for the global political-economic order.
The mainstream core of the "American school" of IPE is strongly oriented toward studying the societal determinants of state trade policy and its empirical questions are strongly oriented toward the analysis of economic openness (or the lack thereof) and its political-economic determinants.
Domestic political determinants of states' international economic policies (with sections on domestic interests and domestic institutions) and strategic international interaction between states are the two broad categories of the OEP literature.
Recent work has sought to reconcile the differences between the HO and RV models through a temporal analysis focused on changing inter-industry factor mobility over time.Liberal Perspectives on the Global Political Economy: Domestic and International Institutions
Liberal perspectives in International Political Economy (IPE) focus on the interplay between domestic and international institutions in shaping economic policies.
Domestic interests approach is a key concept in liberal IPE, which analyzes how domestic actors influence policy-making in the global economy.
The factor mobility, i.e., the movement of capital and labor between industries, is a crucial empirical component in the domestic interests approach.
The measurement of factor mobility is difficult, and studies have shown different levels of factor mobility for the same case.
Domestic political institutions play a significant intervening role in expressing interests and delegating decision-making authority.
Electoral institutions, such as proportional representation systems, can bias policy outcomes in favor of less productive economic sectors.
The organization of the legislative system is another important institutional factor influencing state international economic policy.
International institutions, or regimes, can overcome failures of cooperation by reducing uncertainty, increasing the quality and quantity of information, and reducing transaction costs.
The failures of international cooperation and the waning ability of the United States to underwrite a growing open global economy in the 1970s was the primary empirical motivation of this early liberal work on international institutions.
The theory of hegemonic stability, which explains regime change in trade, money, and oil during the 1970s, emerged as a signature contribution of American IPE to the social sciences.
The theme of hegemony animated considerable work from a liberal perspective, and the theory of hegemonic stability emerged as the signature contribution of American IPE to the social sciences.
Liberal perspectives have expanded analysis into other policy areas referent to the global political economy, such as attitudes towards immigrants and foreign aid.Liberalism and International Institutions in International Political Economy
Realist and liberal scholars have different views on the role of international institutions in promoting international cooperation.
Institutions can reduce uncertainty and transaction costs, promoting cooperation on the basis of common interests.
The literature on regimes shifted towards targeted attention to particular international institutions, such as the International Coffee Organization, the European Union, and the GATT/WTO.
Institutions increase the credibility of state commitments to liberalizing policies by aiding them in resisting the power of anti-liberal and/or "special" domestic interests.
Liberalism has a long tradition of engaging the political role of ideas, values, and beliefs, referred to as "ideational liberalism."
Ideas influence behavior by creating expectations and providing "road maps in uncertain environments."
Common conventions, such as the definition of dumping or expectations related to national treatment of goods and services, may serve as focal points for cooperation.
Ideas are also institutionalized as rules and norms, shaping the incentive structure of actors participating in such institutions.
The diffusion of neoliberal economic policies over the past three decades is a result of strategic interaction between states and policy learning from foreign models.
Liberal work on the importance of ideas in the global political economy has strongly developed in the study of international law and the interaction between legalization and economic governance.
Anne-Marie Slaughter has theorized international law as an expression of liberal ideas and ideals in a transnational liberal society.
Theoretical foundation is primarily the outcome of domestic and transnational social relations.The Normative Foundations of Liberal Political Economy
Liberalism in the global political economy is built upon shared norms and values such as separation of powers, pluralism, and tolerance.
The ideational dimension of international law, incorporating common norms, is foundational to the operation of law.
Liberal work on international law has developed in both the international relations and international law fields.
Empirical work on the contributions of ideas to global economic governance has been less developed.
Rationalist liberalism differentiates social life as "ideas part-way down" and recognizes that rationality itself is culturally determined.
Liberal perspectives on the global political economy have always been motivated by fundamentally normative concerns.
The normative liberal impulse is based on the differentiation between "special interests" and the "public good."
The law/power dichotomy is a sharp distinction between a world of anarchy and unchecked force and an alternative social order organized through cooperative rule-based institutions.
Open Economy Politics has established a strong research program in endogenous state formation, global governance, and the political economy of conflict.
Finance has long taken a back seat among liberal scholars of IPE, and the study of domestic-international linkages relating to financial policy and international financial institutions is a fertile field for research.
The global economic crisis which first emerged at the end of the 2000s offers particularly rich soil for research into the world order which liberals have constructed since the end of the Cold War.
Calls for "bridge-building" between liberalism and rival theoretical perspectives offer interesting and challenging avenues for future research.