International Political Economy

Citation

Oatley, T. (2023). International Political Economy (7th ed.). Routledge.

Chapter Summary

The seventh edition has 16 chapters and about 430 pages, followed by a glossary, references and an index. The publisher describes the book as treating the global economy as a political competition that produces winners and losers, and as surveying the interests and institutions through which state and non-state actors pursue wealth and power. The chapter titles show a repeated structure: an institutional or historical chapter on each topic, followed by a "society-centered" and a "state-centered" chapter that explain the politics behind policy choices. New in this edition, according to the publisher, are the effects of the pandemic, climate change and green industrial policy, great power competition and weaponised interdependence, and the consequences of Russia's invasion of Ukraine for globalisation.

Chapter 1: International Political Economy

The introductory chapter. It sets out what the field studies and the framework for the rest of the book, which the publisher describes as combining basic economic concepts with an account of how domestic and international politics interact.

Chapters 2-3: The WTO and the World Trade System; The Political Economy of International Trade Cooperation

The first block is on trade. Chapter 2 deals with the World Trade Organization and the trading system, and Chapter 3 with the political economy of cooperation among states on trade.

Chapters 4-5: A Society-Centered Approach to Trade Politics; A State-Centered Approach to Trade Politics

Two chapters that give competing explanations of trade policy: the first starts from the interests of groups within society, the second from the state. Their titles show that the book treats the two approaches as a pair that the reader is meant to compare.

Chapters 6-7: Trade and Development I: Import Substitution Industrialization; Trade and Development II: Neoliberalism and Institutionalism

Trade policy in developing countries. Chapter 6 covers import substitution industrialisation, and Chapter 7 the neoliberal and institutionalist approaches that followed it.

Chapters 8-9: Multinational Corporations in the Global Economy; The Politics of Multinational Corporations

A pair of chapters on multinationals, one on their role in the global economy and one on the politics surrounding them.

Chapters 10-11: The International Monetary System; Cooperation, Conflict, and Crisis in the Contemporary International Monetary System

The shift to money and finance. Chapter 10 introduces the international monetary system, and Chapter 11 treats cooperation, conflict and crisis within the contemporary system.

Chapters 12-13: A Society-Centered Approach to Monetary and Exchange-Rate Policies; A State-Centered Approach to Monetary and Exchange-Rate Policies

The trade-section pairing repeated for monetary and exchange-rate policy: one chapter from the interests of groups in society, one from the state.

Chapters 14-15: Developing Countries and International Finance I: The Latin American Debt Crisis; Developing Countries and International Finance II: The Global Capital Flow Cycle

Two chapters on developing countries and international finance. The first is built around the Latin American debt crisis, the second around the global cycle of capital flows.

Chapter 16: The Achievements of and Challenge to the Global Capitalist Economy

The concluding chapter, which assesses what the global capitalist economy has achieved and the challenges it faces.

Key Concepts

Chapters 1-5: Trade

• Winners and losers: the publisher's description of the global economy as a political competition.
• Society-centered and state-centered approaches: two ways of explaining policy, one from groups in society and one from the state, applied to trade in Chapters 4-5.
• The WTO and the trade system: the institutional setting for trade cooperation.

Chapters 6-9: Development and multinationals

• Import substitution industrialisation: a development strategy examined in Chapter 6.
• Neoliberalism and institutionalism: the approaches to trade and development covered in Chapter 7.
• Multinational corporations: treated both economically and politically.

Chapters 10-16: Money, finance and crisis

• The international monetary system: the institutional framework for exchange rates and monetary cooperation.
• Monetary and exchange-rate policy: explained again from the society-centered and state-centered perspectives.
• Debt crisis and capital flows: the Latin American debt crisis and the global capital flow cycle as the cases in Chapters 14-15.

Critical Analysis

Strengths

• A consistent analytical device. The same pairing of society-centered and state-centered approaches is applied to trade and to monetary policy, so a reader learns one way of thinking and then uses it twice.
• Economics explained in the text. The publisher says the book is meant for students with limited background in political theory, history or economics and stresses fundamental economic concepts, so a student need not take an economics course first.
• Clear division into three areas. The contents move through trade, development and multinationals, and money and finance, which makes it easy to assign or study a section on its own.
• Updated for recent events. The seventh edition adds the pandemic, climate policy, great power competition and the war in Ukraine, and is in full colour with 33 colour illustrations according to the publisher.

Limitations

• Limited published criticism. The reviews on the publisher's page are endorsements from instructors; an independent journal review was not found, so claims about teaching effectiveness rest on those endorsements.
• Two main lenses. The structure gives the reader society-centered and state-centered approaches; readers who want critical, Marxist, feminist or other perspectives on the global economy, which the table of contents does not list as chapters, will need supplementary reading.
• Length. At 16 chapters and about 430 pages, the book is a full-term text and is not suited to a quick overview.

Where It Fits in the Course

Within the political economy list, Oatley is the textbook for the international side of the field. It is the next book to read after a short general primer such as Fulcher's Capitalism: A Very Short Introduction, which asks what capitalism is and how it developed but does not teach trade or exchange-rate analysis. Ben Clift's Comparative Political Economy complements it by looking at how national capitalisms differ and change, while Oatley looks at the global trade, monetary and development system that connects them.

Hall and Soskice's Varieties of Capitalism and Olson's The Logic of Collective Action are original contributions rather than textbooks: the first distinguishes liberal from coordinated market economies, and the second explains why groups with a shared interest struggle to organise. Read them after Oatley if you want to see where such arguments about interests and organisation come from. Persson and Tabellini's Political Economics is a graduate text that uses formal economic theory; read it after Oatley, not before.

How to Use This Book

The book is for undergraduates in political science, international relations or economics who want a structured first course in international political economy. The publisher says no strong background in political theory, history or economics is expected.

A practical plan for one term:

• Start. Read Chapter 1 carefully; it frames the rest.
• Core. Work through the trade chapters (2-5) and the monetary chapters (10-13) in order, and read each society-centered chapter immediately before its state-centered partner. The comparison between the two is the point of each pair.
• Selective. The development chapters (6-7, 14-15) and the multinational chapters (8-9) can be assigned or skipped depending on the course. Chapter 16 is worth reading last, as a review of the whole.
• Alongside the book. Use the glossary to check terms, and when you finish a pair of chapters, write a short note on what each approach predicts about a current policy dispute, such as tariffs or exchange rates. Then compare your reasoning with the book's.
• Edition. Use the seventh edition if you want the post-2020 material on the pandemic, climate policy and great power competition.