One dimension of global income inequality swamps all others, the inequality due to differences in living standards among nations. This is primarily the result of differential rates of national economic growth. This paper examines current conditions, then looks at how global inequality has evolved over the past 50 years. After an examination of the causal factors that affect this inequality, it engages in a few speculative observations about what the next half–century might bring.
This essay presents what we believe to be the consensus among political scientists with regard to the analysis of the politics of international economic relations. The review we present is not intended to be exhaustive. We do not, for example, attempt to include the work of scholars who challenge the positivist approach that is assumed here. We believe that this survey does, nonetheless, reflect the principal focuses of North American scholarship in IPE. Most scholarship published in the principal journals of the profession and the sub–discipline, and most graduate training and research, are within the range of the theoretical and empirical topics and approaches presented here.
This paper explores the impact of political economy factors on exchange rate policy in Latin America. It studies the determinants of the choice of exchange rate regime in Latin America, placing special emphasis on political, institutional and interest group explanations. The presumption is that differences in institutional and political settings, as well as differences in economic structure, can have an effect on the choice of regime and, more generally, on exchange rate policy. In addition to these structural elements, the paper examines whether such political events as elections and changes in government affect the pattern of nominal and real exchange rates.
(Revised version of "Politics and Exchange Rates: A Cross-Country Approach for Latin America")
The process of European monetary integration varied widely among countries and over time. This paper argues that an important explanation for the evolution of European exchange rate arrangements was the sectoral impact of their expected effects on European trade and investment. In this perspective, the principal benefit of European MI was its expected easing of cross–border trade and investment within the EU, while its principal cost was the loss of national governments' ability to use currency policy to improve the competitive position of their producers. Empirical results indeed indicate that a stronger and more stable currency was associated with variables used as proxies for private economic interests — the importance of manufactured exports to the DM zone, and improvements in net exports. This suggests a powerful impact of private–interest factors in determining national currency policies.
Economic and Monetary Union (EMU) in Europe will have important effects on international monetary affairs. This is true on both economic and policy–making dimensions. As for the first, the euro is a major new currency whose use in international transactions will affect global monetary and financial relations in and of itself. The euro might rival the dollar as the principal international currency, which would fundamentally alter the character of other countries' exchange rate policies. Or the euro might prove a feeble currency, of little import to countries not directly tied to it. In this sense, the euro's international economic role is of interest and importance.
This essay makes two principal points about the role of preferences in explaining international politics. First, for most analytical purposes, preferences must be kept separate from other things–most important, from characteristics of the strategic setting. Otherwise, we are unable to distinguish between the causal role of actors' interests and that of their environment. Second, scholars need to be explicit about how they determine the preferences of relevant social actors. Whether preferences are variables of interest or control variables, it is essential that they be derived clearly and unambiguously.