GO131:International Relations

Professor Walter HatchColby College

Economic Power

Old Debate over Economic Power

Mercantilism

versus

Liberalism

Mercantilism

16th to 18th centuries

Gold and Silver Bullion = State Power

X > M

Neo-Mercantilism

19th century economic philosophyGermany (Friedrich List), U.S. (Alexander Hamilton), and Japan (Ministry of Commerce and Industry)Promote and protect manufacturing

Commercial Liberalism

Eighteen and nineteenth centuries

David Ricardo and Adam Smith

Gains from trade via specialization

Comparative Advantage

TVs Beer Autarky Ratio

Country A

1 hourper unit

3 hoursper sixpack

1 B: 3 TVs

Country B

2 hoursper unit

4 hoursper sixpack

1 B: 2 TVs

Heckscher-Ohlin Theory

Laissez-Faire

So …Why do governments still intervene in markets?

Classical liberals: domestic politics

Realists: relative gains

Hegemonic Stability(Neo-Realism)

Neo-liberal Institutionalism

The International Economic Order: Fair or rigged?

Realists and liberals don’t care

Marxist theorists doLeninism

Dependency Theory

Modern World System Theory

Modern World System Theory