Political Economic Concepts

The theories of Thomas Oatley on Political Economy theory altered the way the world arena is viewed in terms of losers and winners. By exploring how domestic and foreign relations interact, Oatley offered a deeper explanation of how state and non-state players gain capital and influence. Understanding the International Political Economy is beneficial not only to nations, but also to scholars, politicians, and students who need to consider how political and economic relations are performed on a global scale. To understand the concepts of political economy, Oatley emphasized the need to master the various schools of thought that informed the existing ideas (Oatley 12-16). The ideas during this era were driven by the idealistic and realist ideologies, which explained the interests of various institutions within the global context.
In the explanation of the international political economy, liberal and mercantilist theories are important although each view has its advantage and disadvantages. The most influenced actor by these ideologies is the state as it seeks to understand the international political economy in the contemporary world (Agnew & Staurt 54). Governments should ensure that they have non-state actors and other governments on board in order to be successful in the competitive global market. The liberal theory of free trade was more appealing to reformers as the ordinary people aimed at higher standards, a pattern that was evident in the developed nations like Japan and the United States. The mercantilist theory is the exact opposite of the liberal theory and is behind the creation different regional blocs within the bigger framework of the international political economy. Eventually, the liberal theory has proven to be superior and continues to drive the affairs of the international political economy although there are of the subordinated mercantilist theory. With the introduction of neo-liberalist policies, liberalism has been on the rise since the 1970s and has been at the forefront in the promotion of the globalization process (Olssen & Michaels 340-345). More precisely, the multinational corporations have benefited the most from the ideological perspective. Liberalism has also encouraged the use of technology in carrying out the internal trade. Due to the anarchic nature of the international system, most states in the world tend to subscribe from mercantilist ideology as they look for ways to maximize their national interests and pragmatic goals.
In understanding the Political Economic concepts, the World Trade system is considered as an integral factor in understanding the roles of the hegemons at both the regional and international level(Oatley 23). The systems are essential in ensuring that trade is conduct without discriminatory forms of conduct, an idea that is found in the principle of most-favored-nation (MFN) (Schwartz & Alan 46). The principle discourages the application of lower customs duties to some members for other selfish interests. The concept of national treatment entails the fair treatment of locals and foreign goods in the market in order to create a fair competitive environment. Hegemons are identified as the key actors that corrupt the fair treatment policies through the use of the great influence they have in a given region. Before joining the international platform, nations ought to create a conducive regional environment in which the international forces cannot exploit, in the process of dominance.
Political issues of the state and non-state actors also drive the international trade cooperation (Oatley 40). In the prediction of the outcomes of the international cooperation, Oatley was arguing about the role played by the political economy models and the fairness of economic activities. Political economists should, therefore, expound their views on what makes up a politically active environment beside what is known about the peak and firm associations. Besides, the non-governmental organizations play a primary role in coming up with normative changes in the world politics and should ensure that the political economy adheres to the proposed modeling approaches. On the trade cooperation, Oatley also emphasized the importance of trade policies for a more profound understanding of the different interest groups in the from the government and international systems (Oatley 65). Normative researches on the non-economic interest groups can be done to identify the empirical and theoretical benefits that explain more on the origin and the scope of international cooperation.
Society-centered and state-centered approaches to the politics of trade shed more light in understanding how the non-state actors within the state influence matters of the international trade. Oatley concentrated on the role played by the class and industrial conflict in developing the trade policies (Oatley 80). Industrial policies within the state aim at protecting the local firms from the highly competitive nature of the international trade. More particularly, infant industries are the most protected to prevent them from exiting the market (Oatley, 90). Import substitution policy is another concept in the field of political economy that Oatley discussed in his book. The concept stands for economic and trade policies that aim at uplifting the domestic production at the expense of the imports. Countries are advised to reduce their foreign dependency by encouraging the local production. The idea was also conceived by Alexander Hamilton who suggested various ways of enhancing self-sufficiency through encouraging the growth of internal markets (Keesing 305-307). Oatley also analyzed the effect of the structural adjustment policies through the IMF and the World Bank on the import substitution industrialization.
Multinational/Transnational corporations have been important agents for the growth of the global economy. The operations of these corporations and the concept of foreign direct investment have been controversial issues in the international political economy. There are some scholars who view the MNCs as highly negative while others scholars perceive them as highly positive, hence, sparking a hot debate. The effects of the MNCs are affected by the domestic economic and political conditions. From the ideas that Oatley presented, it becomes necessary to examines the various reasons behind the formation of the MNCs and how they relate to their host and home countries. In some cases, the MNCs have turned out to be stronger than the host nation and thus dictate the internal affairs of a sovereign state because of the high dependence.
The concept of international monetary systems was not considered as important by political economists until the introduction of the currency policies in developing regions like Northern Europe. Scholars began scrutinizing the concept after the Bretton Woods system which tended to be tedious. Political economists became interested in solving the problem of interest rates in Europe, making the international monetary relations to be a great issue of concern. The monetary system is affected by national and global factors. At the national level, governments have unique policies that guide their interests rates which have an impact on the international system. The behavior of the international monetary system interact with the national level policies to create the powerful global system which is better than the Bretton Woods and the classical gold standard that are obsolete. In the fixed rate system national currencies are joined and a public announcement parity made (Oatley 128). A linkage to commodities such as silver or gold is used to peg the national currency. A regional fixed rate monetary system is the one arrived at after regional currencies are linked, and a common currency adopted.
Conclusively, political and economic affairs of the international systems are intricately intertwined. To be successful in international trade, an entrant has to consider the manner in which political affairs are run particularly the hegemonic powers of the big states and the and the current trends and policies enacted to regulate trade. Besides, the roles played by state and non-state actors should be underscored and their relationships evaluated. Other important concepts include the international monetary system, globalization, and the multinational corporations. The modern International political economy seems to be more stable and informed by past failures such as the one on the Bretton Woods currency. Such proposals, failures, and successes are important in informing other regional corporations in the future to in making sound policies that will guarantee their success in the long-run. Amongst other prominent scholars in the field of political economy, Thomas Oatley ideas in the book International Political Economy were well researched for scholarly functions and informing state and non-state actors in their activities within the international arena.










Works Cited
Agnew, John, and Stuart Crobridge. Mastering space: hegemony, territory and international political economy. Routledge, 2002:54.
Keesing, Donald B. "Outward-looking policies and economic development." The Economic Journal (1967): 305-307).
Oatley, Oatley. International political economy. Routledge, 2015.
Olssen, Mark, and Michael A. Peters. "Neoliberalism, higher education and the knowledge economy: From the free market to knowledge capitalism." Journal of education policy 20.3 (2005): 340-345.
Schwartz, Warren F., and Alan O. Sykes. "The economics of the most favored nation clause." Economic dimensions in international law: comparative and empirical perspectives 43 (1997).