After sitting through seemingly endless classes of economics, statistics and econometrics, when it came to doing a PhD I turned to international political economy; it made more sense. This was in the late 1990s and early 2000s, and we had just gone through the decade of globalisation and a series of recurrent global crises that followed the end of the Cold War.
The discipline is young; it started being taught only from the early 1970s. There are few high-profile people who are recognised or who associate themselves explicitly with the discipline. The notable exception is Dani Rodrik, Ford Foundation professor of international political economy at Harvard’s Kennedy School of Government.
Rodrik is in the American tradition, which thrives on scientism. These are the folk who would imagine that economics is a science like physics. While Rodrik does lean theoretically and methodologically towards economics, as opposed to a more complex political economy that considers social and historical issues, he has a solid understanding of the world that is more complex than market orthodoxy would have us believe.
Since the early 1970s there has been a specific focus on the relationships between states and markets, as well as multinational corporations. Those of us in the European tradition — and in the critical tradition — looked at economic diplomacy (who has their hands on the levers of power), geoeconomics, regional economics, global inequality, global poverty, gender, the environment and so on. All of this is a long way from the “mathiness” combined with the exclusivity of empiricism in mainstream economics.
We look at history, and forward at long-run social and historical forces. It’s one of the reasons I got as much from the work of the late Angus Maddison as I did from the Annales School, which helped me identify the intersects between political economy and social history. A defining feature of our thinking, in the critical tradition, is that theory is always for someone, and for some purpose. Sometimes theories rise, and dominate, sometimes they fall and disappear.
Chinese market
It would be difficult, if not impossible, to understand the shift in global political economic power if we focused only on the governments of the US and China, and ignored the way Huawei or TikTok are part of the powerplay in the world — and not just by upsetting Donald Trump. This role and place of multinational corporations is not new, hence the birth of international political economy all those years ago. Large corporations such as Levi’s or even Apple have increasingly become less “American”, as they are now global in terms of their reach, power, influence and cultural significance. The same goes for Coca-Cola.
A few years ago I had a brief opportunity to do some work for a cabinet minister in the portfolio I thought was one of the two most important. That year — 2018 — Coca-Cola bought Costas Coffee, which had branches on most British high streets. A longer view, one shaped not by what’s happening here and now, nor a simple case of apophenia (this is the second time this week that I have used that word, which has me worried), but an appreciation of geoeconomic strategy: and how Coca-Cola may want to use Costas to enter the Chinese coffee market, arguably the world’s biggest emerging market. The minister did not think it was worth knowing about this. I left when my brief spell of being overpaid and underused was over.
Among so many other developments, the evolving dynamics of artificial intelligence have no national boundaries or moorings. They are rooted in knowledge, which does not remain static or fixed, though some states may want to try through intellectual property rights. A more complete understanding of global political affairs, the global commons and how, for better or for worse, private corporate actors are shifting social and historical forces, from Martian explorations to exploring geothermal sources of energy on the ocean bed.
To see how all these fit into a global political economy, economics is necessary but insufficient. We have yet to consider global governance — how poorly it’s understood, and how badly it’s done.
• Lagardien, a visiting professor at the Wits University School of Governance, has worked in the office of the chief economist of the World Bank, as well as the secretariat of the National Planning Commission.
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