https://mediawiki.middlebury.edu/IPE/api.php?action=feedcontributions&user=Daniel+Pulido&feedformat=atomInternational Political Economy - User contributions [en]2024-03-28T14:59:28ZUser contributionsMediaWiki 1.35.14https://mediawiki.middlebury.edu/IPE/index.php?title=Karl_Marx_and_the_End_of_History&diff=523Karl Marx and the End of History2010-11-20T01:36:16Z<p>Daniel Pulido: New page: In his essay “Introduction to The Philosophy of History” Hegel predicted the end of history as the moment when all human beings acquire full awareness of themselves and become free. Th...</p>
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<div>In his essay “Introduction to The Philosophy of History” Hegel predicted the end of history as the moment when all human beings acquire full awareness of themselves and become free. The first stages of humanity were moments where only very few were aware of this fact, but as history progresses more and more people come to this realization. In the first stages of human development political organizations were characterized by the absolute rule of a very reduced number of people. As history developed we created more complicated systems of political organizations that could be summarized as the development of organizations were men are more equal.<br />
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Marx in his youth was a Hegelian. But he became famous for taking the dialectical system developed by Hegel and turning it up side down. For Hegel it was ideas that mattered and that forced the development of history. For Marx it is the material reality of the individual that determines the development of history. Ideologies, legal theory, economic theory, are but projections in our mind that explain or reaffirm the material reality around us. <br />
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For Marx the end of history is also freedom. But not the philosophical freedom that Hegel described, it is an economic freedom. The end of the exploitation of man by man. End of the division of the world between haves and have-nots, between exploiters and exploited. A time when people won’t be forced to sell their labor force because it is all they have. He interpreted the society of his time as divided in two main and opposite groups: the Bourgeoisie and the Proletariat. The bourgeoisie being those who control the means of production, and accordingly, those who control the political power. The proletariat has no property and it is forced to sell they labor to the bourgeois in order to survive. This organization of the economy is called capitalism. Marx predicted that the next step in history was when the proletariat gets control of the means of production and he called this new stage Socialism. In socialism there is still the concept of property. The third and last stage of development would be communism, a time when each person would contribute to society according to his ability and would consume according to his needs.<br />
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The raise of the proletariat to the control of the means of production has to be violent. This is because the bourgeoisie benefits from the inherently unjust capitalist system and has not interest in changing it.</div>Daniel Pulidohttps://mediawiki.middlebury.edu/IPE/index.php?title=European_Economic_Integration&diff=515European Economic Integration2010-11-14T05:03:34Z<p>Daniel Pulido: </p>
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<div>After the end of the Second World War it was absolutely necessary to establish a stable European monetary system that allowed for the economic reconstruction of the continent. Monetary uncertainty and trade wars played a significant role in the radicalization of Germany, especially after the hyper inflation of 1923. There was the consensus that such instability could not be afforded. The Bretton Woods system gave for 15 years the monetary stability that Europe and the world needed for the reconstruction; however, the Europeans were left by themselves in 1971 when Richard Nixon decided to finish the system.<br />
<br />
The end of Bretton Woods came at a bad time. Only two years later, the first oil shock happened. It created a terrible combination of inflation and stagnant economy known as stagflation. The politically diverse Europe responded with very different policies to this crisis. The Germans remained faithful to the strong mark and did not lower interest rates. The French did exactly the opposite decreasing interest rates and running fiscal deficits so as to stimulate the economy. These opposite policies off set one another having little impact in the overall downturn of the European economy. For example, the tight monetary and fiscal policies of the Germans together with the loose policies of the French had the final effect of stimulating French consumers to buy German goods.<br />
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The first half of the 1980’s was a period of transition for the European community. The European Monetary System (EMS) was created in 1979 and around it the idea of low inflation and foreign exchange stability gained ground. Little by little, radical, socialist and right wing politicians agreed around the idea that unemployment and economic growth are only secondary to price stability. This political transformation permitted not only the survival but also the success of the EMS.<br />
<br />
There are several reasons on why the Europeans decided to create a monetary union:<br />
<br />
1. The failure of the 1970's policies showed that cooperation was necessary.<br />
2. Introduction in European universities of monetarist ideas. By the mid 1980s Milton Friedman’s ideas were becoming popular amid European policy makers. <br />
3. Germany had set the example of the mark. This currency had followed the low inflation model with great success. <br />
4. With the increase of European economic integration, it grew the exchange risk. This risk was becoming so important that is was deterring economic development and integration. <br />
5. The movements of capital were becoming so important that it was increasingly difficult (almost impossible) to maintain fixed exchange rates.<br />
<br />
In the 1st of January 1999 the euro is introduced as the common currency for the European Union. In its ten years of existence it has enjoyed great success. <br />
<br />
<br />
Works Used<br />
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McNamara, Kathleen R. The Currency of Ideas: Monetary Politics in the European Union. Ithaca: Cornell University Press, 1998. Ch 1.</div>Daniel Pulidohttps://mediawiki.middlebury.edu/IPE/index.php?title=Heckscher-Ohlin_Model&diff=514Heckscher-Ohlin Model2010-11-14T04:24:08Z<p>Daniel Pulido: </p>
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<div>The Heckscher-Olin Model is an equilibrium model of international trade that builds on David Ricardo's theory of [[Comparative Advantage|comparative advantage]].&nbsp; The model demonstrates that a country will have a comparative advantage in producing goods that are intensive in the factor with which it is relatively abundant. <br />
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This theorem makes two key assumptions. The first, is that each country will differ in the factors of production it has available. One country may have a large and relatively uneducated population with an abundant amount of labor, and perhaps less land and capital (machines and buildings). Another country may be technologically advanced and have high capital but relatively lower availability of land or labor. The second assumption that the theorem holds is that preferences for one good over another across countries are similar. Therefore, relative costs of production (rather than relative demand for goods) dictate how much of a good is produced and consumed prior to specialization and trade. <br />
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Given these assumptions, Heckscher and Ohlin reached the conclusion that countries will have a comparative advantage in goods that are produced with the factor of production (land, labor or capital) that the country has an abundance of. This will logically lead to higher exports of those goods. This theorem differs from the [[Ricardian_Model_of_Trade|Ricardian Model]] and [[Neoclassical_Model_of_Trade|Neoclassical Model]] because it addresses the question of why countries have comparative advantages in particular commodities instead of simply explaining how specialization and trade are beneficial. It is also apt to briefly note that the Neoclassical model differs from the Ricardian in that the latter holds that increasing opportunity costs will lead to partial specialization whereas the former assumes complete specialization of production. <br />
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A common example of the Heckscher-Ohlin Model is in the production of computers and shoes by the United States and Brazil. Since the US has abundant capital, the cost of capital will likely be lower than wages or rents, and since the production of computers is capital-intensive, the US should focus production on computers. Brazil has a relative amplitude of labor and will therefore produce mainly shoes. Both countries have the best chances of increasing overall consumption of both computers and shoes if they specialize in the good that is the cheapest to produce and import the other good<ref>Grieco, Joseph M., and G. John Ikenberry. State Power and World Markets: The International Political Economy. Chapter 2 - The Economics of International Trade. New York: W.W. Norton &amp;amp;amp;amp;amp; Co., 2003.</ref> <br />
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<br><references /><br></div>Daniel Pulidohttps://mediawiki.middlebury.edu/IPE/index.php?title=Eichengreen%27s_Critical_Review_of_Different_Theories_to_Explain_the_Smoot-Hawley_Tariff&diff=495Eichengreen's Critical Review of Different Theories to Explain the Smoot-Hawley Tariff2010-11-06T01:47:29Z<p>Daniel Pulido: New page: Barry Eichengreen critically analyses different models that try to explain the Smoot-Hawley Tariff Act of 1930. The first model that he criticizes is that of “reciprocal noninterference...</p>
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<div>Barry Eichengreen critically analyses different models that try to explain the Smoot-Hawley Tariff Act of 1930.<br />
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The first model that he criticizes is that of “reciprocal noninterference” developed by Schattschneider in his classical monograph about the Smoot-Hawley Tariff of 1935. The theory says that the drafting of the bill was a classical example of pork-barrel politics where each politician was trying to make its constituency happy by increasing the tariff for one particular good. Each sector wanted a share of the cake and that is how the Smoot-Hawley Tariff went out of control. Eichengreen criticizes this model because it does not explain why, if the vote was beneficial to everyone, it followed so closely party lines. Only 5 Democratic Senators voting in favor and 11 Republicans voting against. <br />
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The second model is the agricultural sector model. The 1920’s were years of economic development, but the prosperity was not evenly distributed across the nation. The agricultural sector, which expanded considerably during the First World War, was being affected by the recovering of agriculture in Europe. The increase in supply of foodstuff pushed prices down while in general prices of industrial goods were high. In 1922 the United States becomes a net importer of agricultural products, and the farmers start to lobby the government for greater protection. In 1929 they have their opportunity to make their final push for greater protectionism and this, together with an ever increasing mistrust in the market forces creates the necessary environment for Smoot-Hawley. The criticism to this view is that it does not explain why other products, other than agricultural goods, were also protected by a rise in tariff.<br />
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Some analysts have seen Smooth-Hawley as simply another example of party politics. The republicans had been traditionally protectionist and at that moment both the house and the senate were controlled by republicans and the president was republican. Smooth-Hawley had little obstacle to pass in this congress. This view, however, sees the congress as simply engaging in tariff revision every seven years (the average time between different tariff acts in the period 1883 - 1930) and it does not explain the timing of the bill nor its dimension. <br />
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Eichengreen, Barry "The Political Economy of the Smoot-Hawley Tariff"</div>Daniel Pulidohttps://mediawiki.middlebury.edu/IPE/index.php?title=European_Economic_Integration&diff=411European Economic Integration2010-10-30T01:44:33Z<p>Daniel Pulido: New page: After the end of the Second World War it was absolutely necessary to establish a stable European monetary system that allowed for the economic reconstruction of the continent. After 1923, ...</p>
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<div>After the end of the Second World War it was absolutely necessary to establish a stable European monetary system that allowed for the economic reconstruction of the continent. After 1923, monetary uncertainty and trade wars played a significant role in the radicalization of Germany. There was the consensus that such instability could not be afforded. The Bretton Woods system gave for 15 years the monetary stability that Europe and the world needed for the reconstruction; however, the Europeans were left by themselves in 1971 when Richard Nixon decided to finish the system.<br />
<br />
The end of Bretton Woods came at a bad time. Only two years later, the first oil shock happened. It created a terrible combination of inflation and stagnant economy known as stagflation. The politically diverse Europe responded with very different policies to this crisis. The Germans remained faithful to the strong mark and did not lower interest rates. The French did exactly the opposite decreasing interest rates and running fiscal deficits so as to stimulate the economy. These policies had very little success.<br />
<br />
The first half of the 1980’s was a period of transition for the European community. The European Monetary System (EMS) was created in 1979 and around it the idea of low inflation and foreign exchange stability gained ground. Little by little, radical, socialist and right wing politicians agree around the idea that unemployment and economic growth are only secondary to monetary policy. This political transformation permits not only the survival but the success of the EMS.<br />
<br />
There are several reasons on why the Europeans decided to create a monetary union:<br />
<br />
1. The failure of the 1970's showed that cooperation was necessary.<br />
2. Adoption by European intellectuals of monetarist ideas that supported low inflation.<br />
3. The example of Germany that had followed a policy of hard currency with great success.<br />
4. Europe was composed by so many currencies, and the exchange rate risk was so important that it was deterring economic integration.<br />
5. The movements of capital were becoming so important that it was increasingly difficult (almost impossible) to maintain fixed exchange rates.<br />
<br />
In the 1st of January 1999 the euro is introduced as the common currency for the European Union. In its ten years of existence it has enjoyed great success. <br />
<br />
<br />
Works Used<br />
<br />
McNamara, Kathleen R. The Currency of Ideas: Monetary Politics in the European Union. Ithaca: Cornell University Press, 1998. Ch 1.</div>Daniel Pulidohttps://mediawiki.middlebury.edu/IPE/index.php?title=Institutions_and_Economic_Growth:_A_Historical_Introduction_By_Douglass_North&diff=258Institutions and Economic Growth: A Historical Introduction By Douglass North2010-10-09T01:29:22Z<p>Daniel Pulido: </p>
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<div>In this essay, Douglass North underlines the importance that institutions have had in the economic development of the west. The classical economic model that do not consider the cost of transaction, or that take this cost as fixed, ignores a central element of a decisive element in the functioning of our economic system. <br />
<br />
To understand the importance of institutions, one has to understand the two historical and structural extremes in trade. In primitive societies and in order to avoid cheating, shirking or opportunism the individual engaged only in trade with those who he knew well. The transactions were limited in both space and time because the number of people an individual knew was very small. This reduced the size of the market, forced him to produce most of the things he needed and impeded him to specialize. <br />
<br />
The opposite of personal exchange is specialized interdependence. An ideal model of specialized interdependence is one in which an individual can have trade with someone at the other side of the world without fear of being cheated. The personal knowledge of those who one trades with is no longer necessary, and in consequence the markets available to fulfill one’s necessities and to sell one’s products are much larger. This creates the kind of specialized economy in which both, North and the classical economist, think lays the welfare of societies. <br />
<br />
But for the creation of this specialized interdependence it is vital the creation of a third party that can guarantee contracts and enforce property rights. This third party can be called government but in the essay North simply calls it “institution”. Presumably, North avoids using the word “government” because he takes into account the fact that there are several international organizations and norms that also facilitate trade. <br />
<br />
The essay finishes with an application of the theory using the historical examples of England and Spain during the 16th and 17th centuries. With the introduction of new weapons and war tactics, war became more expensive and both kingdoms were forced to raise taxes. The English collected taxes from the population in the island, this ignited social demands and ultimately the creation of the Parliament. The Parliament being the representation of merchants increased the governmental protection of property rights. On the other hand, Spain relied on the money that was raised in the colonies, not taxing the Spanish population. This allowed the king to reduce the Cortes and the protection of property rights never took.<br />
<br />
<br />
<br />
North, Douglass C. "Institutions and Economic Growth: A Historical Introduction." International Political Economy Perspectives on Global Power and Wealth. By Jeffry Frieden and David A. Lake. New York: Routledge, 2000. 47-59<br></div>Daniel Pulidohttps://mediawiki.middlebury.edu/IPE/index.php?title=Institutions_and_Economic_Growth:_A_Historical_Introduction_By_Douglass_North&diff=257Institutions and Economic Growth: A Historical Introduction By Douglass North2010-10-09T01:28:37Z<p>Daniel Pulido: </p>
<hr />
<div>In this essay, Douglass North underlines the importance that institutions have had in the economic development of the west. The classical economic model that do not consider the cost of transaction, or that take this cost as fixed, ignores a central element of a decisive element in the functioning of our economic system. <br />
<br />
To understand the importance of institutions, one has to understand the two historical and structural extremes in trade. In primitive societies and in order to avoid cheating, shirking or opportunism the individual engaged only in trade with those who he knew well. The transactions were limited in both space and time because the number of people an individual knew was very small. This reduced the size of the market, forced him to produce most of the things he needed and impeded him to specialize. <br />
<br />
The opposite of personal exchange is specialized interdependence. An ideal model of specialized interdependence is one in which an individual can have trade with someone at the other side of the world without fear of being cheated. The personal knowledge of those who one trades with is no longer necessary, and in consequence the markets available to fulfill one’s necessities and to sell one’s products are much larger. This creates the kind of specialized economy in which both, North and the classical economist, think lays the welfare of societies. <br />
<br />
But for the creation of this specialized interdependence it is vital the creation of a third party that can guarantee contracts and enforce property rights. This third party can be called government but in the essay North simply calls it “institution”. Presumably, North avoids using the word “government” because he takes into account the fact that there are several international organizations and norms that also facilitate trade. <br />
<br />
The essay finishes with an application of the theory using the historical examples of England and Spain during the 16th and 17th centuries. With the introduction of new weapons and war tactics, war became more expensive and both kingdoms were forced to raise taxes. The English collected taxes from the population in the island, this ignited social demands and ultimately the creation of the Parliament. The Parliament being the representation of merchants increased the governmental protection of property rights. On the other hand, Spain relied on the money that was raised in the colonies, not taxing the Spanish population. This allowed the king to reduce the Cortes and the protection of property rights never took <ref>North, Douglass C. "Institutions and Economic Growth: A Historical Introduction." International Political Economy Perspectives on Global Power and Wealth. By Jeffry Frieden and David A. Lake. New York: Routledge, 2000. 47-59</ref></div>Daniel Pulidohttps://mediawiki.middlebury.edu/IPE/index.php?title=Institutions_and_Economic_Growth:_A_Historical_Introduction_By_Douglass_North&diff=256Institutions and Economic Growth: A Historical Introduction By Douglass North2010-10-09T01:27:57Z<p>Daniel Pulido: </p>
<hr />
<div>In this essay, Douglass North underlines the importance that institutions have had in the economic development of the west. The classical economic model that do not consider the cost of transaction, or that take this cost as fixed, ignores a central element of a decisive element in the functioning of our economic system. <br />
<br />
To understand the importance of institutions, one has to understand the two historical and structural extremes in trade. In primitive societies and in order to avoid cheating, shirking or opportunism the individual engaged only in trade with those who he knew well. The transactions were limited in both space and time because the number of people an individual knew was very small. This reduced the size of the market, forced him to produce most of the things he needed and impeded him to specialize. <br />
<br />
The opposite of personal exchange is specialized interdependence. An ideal model of specialized interdependence is one in which an individual can have trade with someone at the other side of the world without fear of being cheated. The personal knowledge of those who one trades with is no longer necessary, and in consequence the markets available to fulfill one’s necessities and to sell one’s products are much larger. This creates the kind of specialized economy in which both, North and the classical economist, think lays the welfare of societies. <br />
<br />
But for the creation of this specialized interdependence it is vital the creation of a third party that can guarantee contracts and enforce property rights. This third party can be called government but in the essay North simply calls it “institution”. Presumably, North avoids using the word “government” because he takes into account the fact that there are several international organizations and norms that also facilitate trade. <br />
<br />
The essay finishes with an application of the theory using the historical examples of England and Spain during the 16th and 17th centuries. With the introduction of new weapons and war tactics, war became more expensive and both kingdoms were forced to raise taxes. The English collected taxes from the population in the island, this ignited social demands and ultimately the creation of the Parliament. The Parliament being the representation of merchants increased the governmental protection of property rights. On the other hand, Spain relied on the money that was raised in the colonies, not taxing the Spanish population. This allowed the king to reduce the Cortes and the protection of property rights never took off.<references /><ref>North, Douglass C. "Institutions and Economic Growth: A Historical Introduction." International Political Economy Perspectives on Global Power and Wealth. By Jeffry Frieden and David A. Lake. New York: Routledge, 2000. 47-59</ref></div>Daniel Pulidohttps://mediawiki.middlebury.edu/IPE/index.php?title=Institutions_and_Economic_Growth:_A_Historical_Introduction_By_Douglass_North&diff=255Institutions and Economic Growth: A Historical Introduction By Douglass North2010-10-09T01:26:39Z<p>Daniel Pulido: New page: In this essay, Douglass North underlines the importance that institutions have had in the economic development of the west. The classical economic model that do not consider the cost of tr...</p>
<hr />
<div>In this essay, Douglass North underlines the importance that institutions have had in the economic development of the west. The classical economic model that do not consider the cost of transaction, or that take this cost as fixed, ignores a central element of a decisive element in the functioning of our economic system. <br />
<br />
To understand the importance of institutions, one has to understand the two historical and structural extremes in trade. In primitive societies and in order to avoid cheating, shirking or opportunism the individual engaged only in trade with those who he knew well. The transactions were limited in both space and time because the number of people an individual knew was very small. This reduced the size of the market, forced him to produce most of the things he needed and impeded him to specialize. <br />
<br />
The opposite of personal exchange is specialized interdependence. An ideal model of specialized interdependence is one in which an individual can have trade with someone at the other side of the world without fear of being cheated. The personal knowledge of those who one trades with is no longer necessary, and in consequence the markets available to fulfill one’s necessities and to sell one’s products are much larger. This creates the kind of specialized economy in which both, North and the classical economist, think lays the welfare of societies. <br />
<br />
But for the creation of this specialized interdependence it is vital the creation of a third party that can guarantee contracts and enforce property rights. This third party can be called government but in the essay North simply calls it “institution”. Presumably, North avoids using the word “government” because he takes into account the fact that there are several international organizations and norms that also facilitate trade. <br />
<br />
The essay finishes with an application of the theory using the historical examples of England and Spain during the 16th and 17th centuries. With the introduction of new weapons and war tactics, war became more expensive and both kingdoms were forced to raise taxes. The English collected taxes from the population in the island, this ignited social demands and ultimately the creation of the Parliament. The Parliament being the representation of merchants increased the governmental protection of property rights. On the other hand, Spain relied on the money that was raised in the colonies, not taxing the Spanish population. This allowed the king to reduce the Cortes and the protection of property rights never took off.<ref>North, Douglass C. "Institutions and Economic Growth: A Historical Introduction." International Political Economy Perspectives on Global Power and Wealth. By Jeffry Frieden and David A. Lake. New York: Routledge, 2000. 47-59</ref></div>Daniel Pulidohttps://mediawiki.middlebury.edu/IPE/index.php?title=Dental_Hygiene_and_Nuclear_War:_How_International_Relations_look_from_Economics&diff=52Dental Hygiene and Nuclear War: How International Relations look from Economics2010-09-18T02:20:28Z<p>Daniel Pulido: </p>
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<div>Barry Eichengreen’s article was published in International Organization, Vol. 52, No. 4 (Autumn, 1998).<br />
<br />
The article has nothing to do with dental hygiene or nuclear war. The title derives from the introduction where he makes a short reference to how economists apply their theoretical tools to everything, from dental hygiene to nuclear war. The article is an understanding of international relations as an academic discipline from the view point of economics.<br />
<br />
Eichengreen makes a review of the most important schools of international relations: Interest group model, Institutional approach, Endogenous preferences, Waltz’ system of level analysis. The constant structure in his review of each model is that at the beginning he argues that the assumptions made are fairly close to those used in many economic models; but later he says that the inclusion of politics, ideology or international organizations make the hypothesis formulated by these theories hard to test. For example he compares the Interest Group model that assumes countries to be “black boxes” with the assumption made in microeconomics of firms following profit maximization. However in a second part of his arguments he says that, although it is easy to understand the interest of a firm, it is much harder to define the interest of a country when you include its politics, culture and history. Most importantly, an approach that includes any interest beyond the increase in wealth, though it creates interesting theories, it is hard to test empirically.<br />
<br />
The paper finishes with a call for political scientist specialized in international relations to apply more statistical elements in their analysis. Or in other words, to move away from the case study methodology.</div>Daniel Pulidohttps://mediawiki.middlebury.edu/IPE/index.php?title=Dental_Hygiene_and_Nuclear_War:_How_International_Relations_look_from_Economics&diff=51Dental Hygiene and Nuclear War: How International Relations look from Economics2010-09-18T02:17:10Z<p>Daniel Pulido: New page: Barry Eichengreen’s article was published in International Organization, Vol. 52, No. 4 (Autumn, 1998). The article has very little to do with dental hygiene or nuclear war. The title d...</p>
<hr />
<div>Barry Eichengreen’s article was published in International Organization, Vol. 52, No. 4 (Autumn, 1998).<br />
<br />
The article has very little to do with dental hygiene or nuclear war. The title derives from the introduction where he makes a short reference to how economists apply their theoretical tools to everything, from dental hygiene to nuclear war. The article is an understanding of international relations as an academic discipline from the view point of economics.<br />
<br />
Eichengreen makes a review of the most important schools of international relations: Interest group model, Institutional approach, Endogenous preferences, Waltz’ system of level analysis. The constant structure in his review of each model is that at the beginning he argues that the assumptions made are fairly close to those used in many economic models; but later he says that the inclusion of politics, ideology or international organizations make the hypothesis formulated by these theories hard to test. For example he compares the Interest Group model that assumes countries to be “black boxes” with the assumption made in microeconomics of firms following profit maximization. However in a second part of his arguments he says that, although it is easy to understand the interest of a firm, it is much harder to define the interest of a country when you include its politics, culture and history. Most importantly, an approach that includes any interest beyond the increase in wealth, though it creates interesting theories, it is hard to test empirically.<br />
<br />
The paper finishes with a call for political scientist specialized in international relations to apply more statistical elements in their analysis. Or in other words, to move away from the case study methodology.</div>Daniel Pulido