International Political Economy Fall Semester, AY

Transcription

1 Syllabus 1.0, Fall Semester International Political Economy Instructor: Andrew X. Li Class Hours: Tuesday & Thursday, 15:30-17:10 (venue) Office Hours: TBA (office location) Course Description: This course is a specialized graduate-level seminar in international political economy (IPE) that assumes little or no background in the field. The course surveys four main substantive domains of the international economy that are increasingly inter-related: trade, investment, finance and development. In addition, the last part of the course addresses emerging issues of international migration and environment. The course takes an interdisciplinary approach and examines readings from both economics and political science. At the end of the course, students will be able to analyze phenomena and answer questions such as: why are democracies generally more open to international trade than authoritarian states? Why are some developing countries more attractive to international investors than others? Why is the value of the Saudi Arabian Riyal fairly constant over time while that of the Euro is constantly changing? Students will see that these economic policy outcomes are influenced by domestic actors voters, interest groups, political parties, politicians, bureaucrats as well as political institutions, domestic and international. The course consists of lecture and seminar sessions. The lectures equip students with basic theoretical knowledge and methodological tools to be able to read contemporary IPE literature. The seminars delve deeper into the literature to identify possible directions in which the existing scholarship can be advanced. The aim of the course is to equip students with necessary knowledge and skills to conduct independent research and build on the current state of knowledge in the field and in doing so, promote research on contemporary IPE. Main Texts: The following books are the main texts for this course: Oatley, Thomas (2016). International Political Economy, 5th Edition. Abingdon and New York: Routledge (available at CEU library) Frieden, Jeffry A., David A. Lake and J. Lawrence Broz (2017). International Political Economy: Perspectives on Global Power and Wealth, 6th Edition. New York: W. W. Norton & Company Requirements: 1. Participation and presentation (20%): students are required to participate actively in class and present papers during the seminar sessions. 2. Comment papers (30%): each student will submit two comment papers on the readings of a seminar session of his/her own choosing. These sessions may be the same sessions in which the student is assigned to present papers. The paper may include relevant readings from a lecture session, but please don t write exclusively on the lecture readings. The paper should be 1000 words in length and provide i) a succinct summary of the research question, methodology, and major findings of the readings; ii) an analytical review that identifies their strengths and weaknesses of the readings; and iii) possible research questions that follow from the commentary. The paper should be submitted by noon of the day before the seminar session so that it can be circulated to the class. 3. Policy papers (30%): each student will submit two policy papers on a policy debate of his/her own choosing. The paper should be 1000 words in length. It should i) take a Page 1 of 7

2 position on the debate; ii) explain why this position is taken; and iii) consider possible criticisms and defend the position against them. The topics of policy debate are announced during class together with the deadlines of the policy paper. Each topic of policy debate has its own deadline. 4. For this assignment, students will have a choice between Option A and Option B: Option A: Statement of purpose (20%): each student will assume that he/she is applying to a PhD program of his/her own choosing and intends to carry out research in the field of IPE. Thus, each student will write a statement of purpose, which is typically required of an applicant by almost all PhD programs. The statement should i) clearly identify a research question in IPE, ii) justify its scholarly significance and iii) mention the people (potential advisors) whom you want to work with during your PhD study and how you may benefit from their expertise. The statement is expected to be 4-5 double spaced pages in length and is due on November 30 th, Option B: Country report (20%): each student will assume that he/she is a specialist of country X employed in a consultancy firm. One of the firm s client, a big multinational corporation (MNC) producing consumer electronics is considering investing in country X. To make an investment decision, the CEO of the MNC would like to know i) the general economic environment of country X concerning foreign direct investment (eg: cost of labor, availability of land and etc.); ii) the condition of the consumer electronics industry in country X (eg: any rivals?); iii) government policies governing FDI in country X, both general and industry specific and iv) the relationship between the government and MNCs and the level of political risk in country X. Your task is to write a report on country X addressing these issues, where country X is a country of your choice. The report is expected to be 4-5 double spaced pages in length and is due on November 30 th, Penalty for late work: 1 percentage point of overall grade per calendar day Course Schedule Week 1: Introduction and Overview Session 1 (Sep 19 th, 2017): lecture - This syllabus - Oatley (2016), Chapter 1: Frieden, Lake and Broz (2017), Introduction: 1-17 Session 2 (Sep 21 st, 2017): lecture - Maliniak, Daniel, and Michael J. Tierney. "The American School of IPE." Review of International Political Economy 16.1 (2009): De Mesquita, Bruce Bueno. Principles of International Politics. Los Angeles: Sage Publications (2014), Chapter 1: Braumoeller, Bear F. and Sartori, Anne E. The Promise and Perils of Statistics in International Relations, in Detlef F. Sprinz and Yael Wolinsky-Nahmias (eds), Models, Numbers, and Cases: Methods for Studying International Relations. Ann Arbor: University of Michigan Press (2004): I. International Trade Week 2: Interests and Preferences in Trade Policy Session 1 (Sep 26 th, 2017): lecture - Oately (2016), Chapter 4-5: Broz, Frieden and Lake (2017), Chapter 1: Page 2 of 7

3 Session 2 (Sep 28 th, 2017): seminar - Hiscox, Michael J. "Class Versus Industry Cleavages: Inter-industry Factor Mobility and the Politics of Trade." International Organization 55.1 (2001): Scheve, Kenneth F., and Matthew J. Slaughter. "What Determines Individual Trade-policy Preferences?" Journal of International Economics 54.2 (2001): ## - Gawande, Kishore, Pravin Krishna, and Marcelo Olarreaga. "What Governments Maximize and Why: The View from Trade." International Organization 63.3 (2009): Hainmueller, Jens, and Michael J. Hiscox. "Learning to Love Globalization: Education and Individual Attitudes Toward International Trade." International Organization 60.2 (2006): Hicks, Raymond, Helen V. Milner, and Dustin Tingley. "Trade Policy, Economic Interests, and Party Politics in a Developing Country: The Political Economy of CAFTA-DR." International Studies Quarterly 58.1 (2014): ## - Baker, Andy. "Who Wants to Globalize? Consumer Tastes and Labor Markets in a Theory of Trade Policy Beliefs." American Journal of Political Science 49.4 (2005): Week 3: International Trade and Political Institutions Session 1 (Oct 3 rd, 2017): lecture - Oately (2016), Chapter 2-3: Rosendorff, B. Peter. "Stability and Rigidity: Politics and Design of the WTO's Dispute Settlement Procedure." American Political Science Review 99.3 (2005): Session 2 (Oct 5 th, 2017): seminar - Gowa, Joanne, and Soo Yeon Kim. "An Exclusive Country Club: The Effects of the GATT on Trade, " World Politics 57.4 (2005): Maggi, Giovanni. "The Role of Multilateral Institutions in International Trade Cooperation." American Economic Review 89.1 (1999): Milner, Helen V., and Keiko Kubota. "Why the Move to Free Trade? Democracy and Trade Policy in the Developing Countries." International Organization 59.1 (2005): ## - Kono, Daniel Y. "Optimal Obfuscation: Democracy and Trade Policy Transparency." American Political Science Review (2006): ## - Ehrlich, Sean D. "Access to Protection: Domestic Institutions and Trade Policy in Democracies." International Organization 61.3 (2007): Chen, Chao and Andrew X. Li. Does Democracy Cause Trade Policy Liberalization? Unpacking the Black Box of Trade Policy. Journal of International Relations and Development. Forthcoming. doi: /s II. International Investment Week 4: International Capital Mobility Session 1 (Oct 10 th, 2017): lecture - Oatley (2016), Chapter 8: Frieden, Lake and Broz (2017), Chapter 9: Pandya, Sonal S. "Labor Markets and the Demand for Foreign Direct Investment." International Organization 64.3 (2010): Session 2 (Oct 12 th, 2017): seminar - Ahlquist, John S. "Economic Policy, Institutions, and Capital Flows: Portfolio and Direct Investment Flows in Developing Countries." International Studies Quarterly 50.3 (2006): ## - Quinn, Dennis P., and Carla Inclan. "The Origins of Financial Openness: A Study of Current and Capital Account Liberalization." American Journal of Political Science (1997): Singer, David Andrew. "Capital Rules: The Domestic Politics of International Regulatory Harmonization." International Organization 58.3 (2004): Page 3 of 7

4 - Haggard, Stephan, and Sylvia Maxfield. "The Political Economy of Financial Internationalization in the Developing World." International Organization 50.1 (1996): Simmons, Beth A., and Zachary Elkins. "The Globalization of Liberalization: Policy Diffusion in the International Political Economy." American Political Science Review 98.1 (2004): Chwieroth, Jeffrey. "Neoliberal Economists and Capital Account Liberalization in Emerging Markets." International Organization 61.2 (2007): Pepinsky, Thomas B. "Do Currency Crises Cause Capital Account Liberalization?" International Studies Quarterly 56.3 (2012): ## Week 5: Foreign Direct Investment and Host Countries Session 1 (Oct 17 th, 2017): lecture - Oatley (2016), Chapter 9: Simmons, Beth A. "Bargaining over BITs, Arbitrating Awards: The Regime for Protection and Promotion of International Investment." World Politics 66.1 (2014): Session 2 (Oct 19 th, 2017): seminar - Jensen, Nathan M. "Democratic Governance and Multinational Corporations: Political Regimes and Inflows of Foreign Direct Investment." International Organization 57.3 (2003): Li, Quan, and Adam Resnick. "Reversal of Fortunes: Democratic Institutions and Foreign Direct Investment Inflows to Developing Countries." International Organization 57.1 (2003): ## - Büthe, Tim, and Helen V. Milner. "The Politics of Foreign Direct Investment into Developing Countries: Increasing FDI through International Trade Agreements?" American Journal of Political Science 52.4 (2008): Basinger, Scott J., and Mark Hallerberg. "Remodeling the Competition for Capital: How Domestic Politics Erases the Race to the Bottom." American Political Science Review 98.2 (2004): Elkins, Zachary, Andrew T. Guzman, and Beth A. Simmons. "Competing for Capital: The Diffusion of Bilateral Investment Treaties, " International Organization 60.4 (2006): ## - Jandhyala, Srividya, Witold J. Henisz, and Edward D. Mansfield. "Three Waves of BITs: The Global Diffusion of Foreign Investment Policy." Journal of Conflict Resolution 55.6 (2011): Haftel, Yoram Z., and Alexander Thompson. "Delayed Ratification: The Domestic Fate of Bilateral Investment Treaties." International Organization 67.2 (2013): III. International Finance Week 6: Exchange Rate Policies and Forex Intervention I Session 1 (Oct 24 th, 2017): lecture - Oatley (2016), Chapter 10-11: Bernhard, William, J. Lawrence Broz, and William Roberts Clark. "The Political Economy of Monetary Institutions." International Organization 56.4 (2002): Session 2 (Oct 26 th, 2017): lecture - Oatley (2016), Chapter 12-13: Steinberg, David. Demanding Devaluation: Exchange Rate Politics in the Developing World. Ithaca: Cornell University Press, Chapter 1: Week 7: Exchange Rate Policies and Forex Intervention II Session 1 (Oct 31 st, 2017): seminar Page 4 of 7

5 - Broz, J. Lawrence. "Political System Transparency and Monetary Commitment Regimes." International Organization 56.4 (2002): Bodea, Cristina. "Exchange Rate Regimes and Independent Central Banks: A Correlated Choice of Imperfectly Credible Institutions." International Organization 64.3 (2010): Bearce, David H., and Mark Hallerberg. "Democracy and de facto Exchange Rate Regimes." Economics & Politics 23.2 (2011): ## - Bearce, David H. "Societal Preferences, Partisan Agents, and Monetary Policy Outcomes." International Organization 57.2 (2003): Hallerberg, Mark. "Veto Players and the Choice of Monetary Institutions." International Organization 56.4 (2002): Singer, David Andrew. "Migrant Remittances and Exchange Rate Regimes in the Developing World." American Political Science Review (2010): ## Session 2 (Nov 2 nd, 2017): seminar - Calvo, Guillermo A., and Carmen M. Reinhart. "Fear of Floating." The Quarterly Journal of Economics (2002): Levy-Yeyati, Eduardo, Federico Sturzenegger, and Pablo Alfredo Gluzmann. "Fear of Appreciation." Journal of Development Economics 101 (2013): Walter, Stefanie. "A New Approach for Determining Exchange-rate Level Preferences." International Organization 62.3 (2008): ## - Steinberg, David A., and Krishan Malhotra. "The Effect of Authoritarian Regime Type on Exchange Rate Policy." World Politics 66.3 (2014): ## - Kinderman, Daniel. "The Political Economy of Sectoral Exchange Rate Preferences and Lobbying: Germany from , and Beyond." Review of International Political Economy 15.5 (2008): Steinberg, David A., and Victor C. Shih. "Interest Group Influence in Authoritarian States: The Political Determinants of Chinese Exchange Rate Policy." Comparative Political Studies (2012): Week 8: Financial Crisis Session 1 (Nov 7 th, 2017): lecture - Oatley (2016), Chapter 14-15: Copelovitch, Mark, Jeffry Frieden, and Stefanie Walter. "The Political Economy of the Euro Crisis." Comparative Political Studies 49.7 (2016): Reinhart, Carmen M., and Kenneth Rogoff. This Time is Different: Eight Centuries of Financial Folly. Princeton: Princeton University Press, Chapter 13: Session 2 (Nov 9 th, 2017): seminar - Leblang, David, and Shanker Satyanath. "Institutions, Expectations, and Currency Crises." International Organization 60.1 (2006): ## - Keefer, Philip. "Elections, Special Interests, and Financial Crisis." International Organization 61.3 (2007): MacIntyre, Andrew. "Institutions and Investors: The Politics of the Economic Crisis in Southeast Asia." International Organization 55.1 (2001): Rosas, Guillermo. "Bagehot or Bailout? An Analysis of Government Responses to Banking Crises." American Journal of Political Science 50.1 (2006): Leblang, David. "To Devalue or to Defend? The Political Economy of Exchange Rate Policy." International Studies Quarterly 47.4 (2003): Walter, Stefanie. "The Limits and Rewards of Political Opportunism: How Electoral Timing Affects the Outcome of Currency Crises." European Journal of Political Research 48.3 (2009): Sattler, Thomas, and Stefanie Walter. "Monetary Credibility vs. Voter Approval: Political Institutions and Exchange Rate Stabilization During Crises." Economics & Politics 22.3 (2010): ## IV. Development Page 5 of 7

6 Week 9: Determinants of Growth and Development in Open Economies Session 1 (Nov 14 th, 2017): lecture - Oatley (2016), Chapter 6-7: Rodrik, Dani. "The Past, Present, and Future of Economic Growth." Challenge 57.3 (2014): Session 2 (Nov 16 th, 2017): seminar - Frankel, Jeffrey A., and David Romer. "Does Trade Cause Growth?" American Economic Review 89.3 (1999): Alcalá, Francisco, and Antonio Ciccone. "Trade and Productivity." The Quarterly Journal of Economics (2004): Hansen, Henrik, and John Rand. "On the Causal Links between FDI and Growth in Developing Countries." The World Economy 29.1 (2006): Rodrik, Dani. "The Real Exchange Rate and Economic Growth." Brookings Papers on Economic Activity (2008): ## - Mbaye, Samba. "Currency Undervaluation and Growth: Is There a Productivity Channel?" International Economics 133 (2013): ## - Przeworski, Adam, and James Raymond Vreeland. "The Effect of IMF Programs on Economic Growth." Journal of Development Economics 62.2 (2000): Week 10: IMF Lending and Foreign Aid. Session 1 (Nov 21 st, 2017): lecture - Vreeland, James Raymond. The International Monetary Fund: Politics of Conditional Lending. Abingdon and New York: Routledge, Chapter 1-2: Vreeland, James Raymond. The IMF and Economic Development. New York: Cambridge University Press, Chapter 3: Session 2 (Nov 23 rd, 2017): seminar - Stone, Randall W. "The Scope of IMF Conditionality." International Organization 62.4 (2008): ## - Copelovitch, Mark S. "Master or Servant? Common Agency and the Political Economy of IMF Lending." International Studies Quarterly 54.1 (2010): ## - De Mesquita, Bruce Bueno, and Alastair Smith. "A Political Economy of Aid." International Organization 63.2 (2009): Kono, Daniel Yuichi, and Gabriella R. Montinola. "Does Foreign Aid Support Autocrats, Democrats, or Both?" The Journal of Politics 71.2 (2009): Djankov, Simeon, Jose G. Montalvo, and Marta Reynal-Querol. "The Curse of Aid." Journal of Economic Growth 13.3 (2008): Bearce, David H., and Daniel C. Tirone. "Foreign Aid Effectiveness and the Strategic Goals of Donor Governments." The Journal of Politics 72.3 (2010): V. Emerging Topics in IPE Week 11: International Migration Session 1 (Nov 28 th, 2017): lecture - Freeman, Gary P., and Alan K. Kessler. "Political Economy and Migration Policy." Journal of Ethnic and Migration Studies 34.4 (2008): Cerna, Lucie. Immigration Policies and the Global Competition for Talent. London: Palgrave Macmillan, Chapter 2: Dancygier, Rafaela M. Immigration and Conflict in Europe. New York: Cambridge University Press, Chapter 2: Page 6 of 7

7 Session 2 (Nov 30 th, 2017): seminar - Scheve, Kenneth F., and Matthew J. Slaughter. "Labor Market Competition and Individual Preferences over Immigration Policy." The Review of Economics and Statistics 83.1 (2001): Mayda, Anna Maria. "Who is Against Immigration? A Cross-country Investigation of Individual Attitudes Toward Immigrants." The Review of Economics and Statistics 88.3 (2006): Hainmueller, Jens, and Michael J. Hiscox. "Attitudes Toward Highly Skilled and Low-skilled Immigration: Evidence from a Survey Experiment." American Political Science Review (2010): Peters, Margaret E. "Open Trade, Closed Borders: Immigration in the Era of Globalization." World Politics 67.1 (2015): ## - Facchini, Giovanni, Anna Maria Mayda, and Prachi Mishra. "Do Interest Groups Affect US Immigration Policy?" Journal of International Economics 85.1 (2011): Hainmueller, Jens, and Dominik Hangartner. "Does Direct Democracy Hurt Immigrant Minorities? Evidence from Naturalization Decisions in Switzerland. American Journal of Political Science. Forthcoming - Just, Aida, and Christopher J. Anderson. "Immigrants, Citizenship and Political Action in Europe." British Journal of Political Science 42.3 (2012): Hainmueller, Jens, Dominik Hangartner, and Giuseppe Pietrantuono. "Catalyst or Crown: Does Naturalization Promote the Long-term Social Integration of Immigrants?" American Political Science Review (2017): ## Week 12: Globalization, Trade and Environment Session 1 (Dec 5 th, 2017): lecture - Oatley (2016), Chapter 16: Frieden, Lake and Broz (2017), Chapter 29: Session 2 (Dec 7 th, 2017): seminar - Prakash, Aseem, and Matthew Potoski. "Racing to the Bottom? Trade, Environmental Governance, and ISO " American Journal of Political Science 50.2 (2006): Bechtel, Michael M., Thomas Bernauer, and Reto Meyer. "The Green Side of Protectionism: Environmental Concerns and Three Facets of Trade Policy Preferences." Review of International Political Economy 19.5 (2012): ## - Ehrlich, Sean D. "The Fair Trade Challenge to Embedded Liberalism." International Studies Quarterly 54.4 (2010): ## Notes to Students: All readings listed under the lecture sessions are required readings. For each seminar session, articles ending with ## sign are the ones selected for student presentations. The selected ones are required readings and the rest are optional. Student presentations only start in Week 3. I will present the selected articles in Week 2 as a demonstration. When you read the articles, focus on the theoretical arguments and their connections to the existing literature. Do not be scared by the mathematics and statistics! I will gradually introduce you to the technical content and help you to read and present such content throughout the course. DON T PANIC! Page 7 of 7