IPE Continued: Globalisation and Changing Social Contracts
Anna Leander
Winter Term 1996
Department of Political Sciences

Course Description

Globalisation (the subject of "an introduction to IPE") is more than a trendy word. It is a process with crucial implications for the organisation of economics and politics in all countries. The result is a redifinition of politics or a transnationalisation of politics, the significance of which is reflected in current political debates. The "imperatives of international competition" are increasingly used to explain why certain "social contracts" are viable and others not. Thus, the weight of the international economy is an important part of the argument when Margaret Thatcher exclaims "there is no alternative! [TINA]" when "the end of the welfare state" is proclaimed, or when austerity policies are justified.

This course (IPE continued) is a study of one narrowly defined, but central, debate regarding this transnationalisation of politics: that regarding the replacement of the "welfare state" with what is at times called a "competition state" (a state geared essentially at promoting economic competitiveness).' It aims both at providing an understanding of the concrete mechanisms by which globalisation has changed the bargains underlying the welfare state, thereby undermining it, and at assessing the TINA [in this case to the competition state] claim. Although the course draws mainly on material regarding EU members and institutions (to give a rather narrowly focused and more detailed understanding of the processes discussed) the debate is of equal relevance for late industrialises and economies in transition. In class presentations on related debates for the two latter will be most welcome.

The course begins with a clarification of why the, allegedly inevitable, transition to a "competition state" is a problem at the heart of the current IPE debate. The second section is designed to clarify the debate over how globalisation changes the conventional bargains over economic distribution. It looks mainly on the increasing bias toward (national and foreign) business in this bargain, but also touches on the new role of inter-governmental and supranational institutions. Finally, the course will assess the TINA argument by reading representative texts of authors who refute it.

Course Requirements:

Students will be assessed on the basis of three essays (to be handed in at the end of each section, 50%) and their in class activity (in class discussion of the readings (20%), a presentation and their discussion of the presentation of a pear? (15% each)).


Week l: The Competition State

Philip G. Cerny, The Changing Architecture of Politics. Structure Agency and the Future of the State (London: Sage Publications, 1988), chap. 8.

Week 2: Globalisation Undermining the Welfare State

John G. Ruggie, At Home Abroad Abroad at Home: International Liberalisation and Domestic Stability in the New World Economy (Florence: EUI lean Monnet Chair Papers, no. 20, 1995).

Phil Cerny, in a chapter with the title "Transnational Structures and State Responses: From the welfare state to the competition state", in The Changing Architecture of the State.

Vivian Schmidt, "The New World Order Incorporated: The Rise of Business and the Decline of the Nation State", Daedalus (spring 1995).

Week 3: The Competition State as a Welcome Solution to the Welfare State Problem

Mancur Olson, The Rise and Decline of Nations. Economic Growth, Stagflation, and Social Rigidities (New Haven: Yale University Press, 1982), chaps. 1-4, 7.

Week 4: The Social Significance of "Embedded Economic Relations"

Karl Polanyi, The Great Transformation: The Political and Economic Origins of Our Time (Boston: Beacon Paperback, 1957, 1st. edition 1944), pp. 130-219.

Week 5: A Problem for (National) Democracy

David Held, "Democracy, the Nation State, and the Global System," in David Held (eds), Political Theory Today (Stanford UP, 1991).

Joachim Hirsch, "Nation State, International Regulation and the Question of Democracy," RIPE vol.2 no.2 (1995).


Week 6: Shifting Bargains

Alan Cawson, "Introduction. Varieties of Corporatism. The Importance of the Meso-Level of Interest Mediation," in Alan Cawson, ed., Organized Interests and the State. Studies in Meso-Corporatism (London: Sage, 1985), pp. 1-22.

Chris Moore & Simon Booth, Managing Competition: Meso-Corporatism, Pluralism, and the Negotiated Order in Scotland (Oxford: Oxford University Press, 1989), Chap. 1-2.

Week 7 Structural Shifts in Business Influence

John M. Stopford & Susan Strange, with John Henley, Rival States, Rival Firms. Competition for World Market Shares (Cambridge et al.: Cambridge University Press, 1991), chaps. 1-2 and 4.

Phillip Cerny, "Embedded Financial Orthodox" in Ronen Palan and Barry Gills, Transcending the State Global Divide, (Boulder. CO.: Lynne Rienner, 1994).

Week 8: Business Inside the Baroain (new roles)

William D. Coleman, "Keeping the Shotgun Behind the Door," in Hollingsworth, Streeck, Schmitter (eds) Governing Capitalist Economies (New York, Oxford UP, 1994).

Geoffry Underhill, "Keeping Governments out of Politics: transnational securities markets, regulatory cooperation, and political legitimacy," Review of International Studies vol. 25, 1995, pp. 251-278.

Christoph Nitsche & Chris Hope, Banks as 'Policemen': Money Laundering and the Proposed European Environmental Liability Legislation (Cambridge: Judge Institute of Management Studies, October 1993, working paper no. 2).

Wolfgang Streeck & Pillippe C. Schmitter, "Community, Market, State - and Associations? The Prospective Contribution of Interest Governance to Social Order," in Wolfgang Streeck and Phillippe C. Schmitter. ed., Private Interest Government. Beyond Market and State (London: Sage, 1985), pp. 1-29 (to be distributed separately).

Week 9: Business Outside the Bargain (private conditionality)

Irving S. Friedman. "Private Bank Conditionality Comparison with the IMF and the World Bank," in John Williamson (ed.) IUF Conditionality (Washington DC- Institute for International Economics), pp. 109-124.

Tim Sinclair, "Credit Rating" RIPE, vol. 1, no. I (1994).

Week 10: Weakened Labour

Claus Offe, Disorganised Capitalism, (Polity Press, 1985), chap. 2.

Wolfgang Streeck & Phillippe C. Schmitter, "From National Corporatism to Transnational Pluralism: Organized Interests in the Single European Market," Politics and Society, vol. 19, no. 2 (June 1991), pp. 133-165.

Wolfgang Streeck, "The Social Dimension of the European Economy," in D. Mayes, W. Hager, A. Knight, and W. Streeck, Public Interests and Market Pressures (London: Macmillan, 1993).

Week 11: New Partners in the Bargain: International Institutions (the case of the EU)

Stephan Leibfried and Paul Pierson, "Europe's Semi Sovereign Welfare States: Social Policy in an Emerging Multi-tiered System," in S. Leibfried, European Social Policy: Between Fragmentation and Integration (Washington DC: Brookings, 1995).

Martin Rohdes, "The Social Dimension after Maastricht: Setting the New Agenda for the Labour Market", Internantional Journal for Comparative Labour Law and Industrial Relantions, vol. 9, no. 4 (1993)


Week 12: The Competition State is not Necessary

Paul Krugman, "Competitiveness: A Dangerous Obsession," Foreign Affairs, vol. 73, no. 2, (1994), pp. 28-44. (and the discussion in the following issues).

D. Gordon, "The global economy: new edifice or crumbling foundations." New Left Review, vol. 168, 1988. pp. 24-64.

Week 13: Re-democratization Through Transnational Social Movements

Claus Offe. "Challenging the Boundaries of Institutional Politics: Social movements since the 1960s,", in Charles S. Maier (ed.) Changing Boundaries of the Political Essays on the evolving balance between the state and society, public and private in Europe (Cambridge UP, 1987).

Vincent Cable. "The Diminished Nation-State," Daedalus, (spring 1995).

Week 14: Regional Associations as an Alternative (the EU)

K. Hagen, "The Social Dimension: A Quest for European Welfare Sate," in Z. Ferge and J. Kolberg (eds) Social Policies in a Changing Europe (Frankfurt, Campus Verl., 1992).

G. Majone, "Deregulation or Re-regulation? Policy-making in the European Community since the singly act." (Florence: EUI working papers, sps. no. 9372, 1993).

Week 15: The Global Alternative

Craig Murphy, International Organization and Industrial Change (Polity Press, 1994), introd. and chaps. 1 and 8.

David Held, "From City States to Cosmopolitan Order", in D. Held (ed.) Prospects for Democracy (Polity Press. 1993).

Week 16: Conclusion

Albert O. Hirschman, "The Rhetoric of Reaction. Perversity, Futility, Jeopardy" (Cambridge, MA, London: The Belknap Press of Harvard University Press, 1991), concluding section.

Albert O. Hirschman, "Political Economics and Possibilism," in A Bias for Hope: Essays on Development and Latin America (Boulder and London: Westview Press, 1985, Ist. edition 1971).

Journals to follow regularly:

Comparative Politics, Economy and Society, International Organization, Millennium, New Left Review, Politics and Society, Review of International Political Economy, Review of International Relations, World Politics.

Supplementary readings:

Charles Beitz, Political Theory and IR (Princeton: Princeton UP, 1979), pp. 125-185 in particular.

Christopher Bryant and Edmund Mokrzsycki (eds) The New Great Transformantion? Change and Continuity in East and Central Europe (London and New Yolk: Routledge, 1994).

Richard Caves, "Income distribution and labor relations," in Theodore Moran (ed.) Multinational Corporations. The Political Economy of Foreign Direct Investment (Lexington: Lexington Books, 1985), pp 173-199.

Robert Cox, Production, Power and World Order (New York: Columbia UP, 1987).

Robert W. Cox, "Production, the State, and Change in World Order," in Ernst-Otto Czempiel & James A. Rosenau, eds, Global Changes and Theoretical Challenges. Approaches To World Politics in the 1990's (Lexington, Mass.: Lexington Books, 1989), pp. 37-50.

Colin Crouch and David Marquand (eds) Ethics and Markers (New York: Blackwell, 1993).

John H. Dunn, "Responsibility without power: States and the Incoherence of the modem conception of the political good," in Dunn ed., Interpreting Political Responsibility (Cambridge: Polity Press, 1990).

John H. Dunn ed., The Economic Limits to Modern Politics (Cambridge: Cambridge UP, 1992).

Geoffry Garrett: "Capital mobility and trade and the domestic politics of economic policies," IO (aut. 1995).

Geoffrey Garrett and Peter Lange. "Political Responses to Interdependence: What's "Left" for the Left?," International Organization, vol. 45, no. 4 (autumn, 1991), pp. 537-564.

Miriam Golden, Peter Lange & Michael Wallerstein "The End of Corporatism" in J. SANDFORD (ed.) National Labour, Global Capital: Societal Responses to Economic Integration in Asia, Europe and North America (Oxford, 1992).

Andre Grjebine, La nouvelle economie internationale (Paris: PUF, 1980/86, 2.ed.).

L. Hantrais, and S. Mangen (eds) The Policy Making process and the Social Actors (Loughborough University: European Research Centre, 1993).

David Held and D. Archibugi (eds), Cosmopolitan Democracy (Cambridge: Polity Press, 1995). David Held (eds), Political Theory Today (Stanford UP, 1991).

David Held, Prospects for Democracy (Cambridge: Polity Press, 1993).

Hans-Henrik Holm and Georg Sorensen (eds), Whose World Order? Uneven Globalization and the End of the Cold War (Boulder, 1995).

Paul Hirst and Grahame Thompson, "Globalisation and the Future of the Nation State", Economy and Society, vol. 24, no.3 (1995).

Stanley Hoffman, Duties Beyond Borders: On the Limits and Possibilities of Ethical International Politics (Syracuse University Press 1981).

Marcus Jachtenfuchs. "Theoretical Perspectives on European Governance," European Law Journal, vol. 1, no. 2. (July 1995).

Mark Kesselman, "How Should One Study Economic Policy-Making: Four Characters in Search of an Object," World Politics vol. 44, no. 4 (July 1992). pp. 645-672.

Walter Korpi, "Economists as Policy Experts and Policy Advocates: On Problems of Values and Objectivity in the Welfare State - Economic Growth Debate," paper presented at the International Sociological Association's Committee on Comparative Research on Welfare States in Transition (Oxford, 9-12 Sept, 1993).

Scott Lash and John Urry, The End of Organized Capitalism (Cambridge: Polity Press, 1987).

Alain Lipietz, Towards a New Economic Order: Postfordism, Ecology and Democracy Cambridge: Polity Press, 1993).

S. Leibfried, "The Social Dimension of the European Union: En Route to Positive Joint Sovereignty?", Journal of European Social Policy, vol. 4, mo. 4 (1994).

Giandomenico Majone, The European Community: An Independent Fourth Branch of Government, European University Institute, Political and Social Science Working papers (1993 no. 9).

Andy Moravcsik, Why the EU Strengthens the State: Domestic Politics and International Cooperation, (Harvard University, Centre for European Studies Working paper series: #52, 1994).

Claus Offe, Modernity and the State: East and West (Cambridge: Polity Press, 1995).

Martin Rohdes, Subversive Liberalism: Market Integration, Globalisation and the European Welfare State (EUI Working paper. RSC 95/10).

Amartya Sen, "Ethical Issues in Income Distribution: National and International, in A. Sen (ed.) Resources, Values, and Development. (Oxford: Blackwell, 1984).

Schwarz and Thompson, Divided we Stand. Redefining Politics, Technology and Social Choice (New York: Harvester Wheatsheaf, 1993).

Stephen J. Silva, "The Social Charter and the European Community: A Defeat for European Labour," Industrial and Labour Relations Review, vol. 44 (July 1991).

Franz Taxler "Farewell to Labour Market Associations? Organised versus Disorganised Decentralization as a Map for Industrial Relations" in Colin Crouch & Franz Taxler (eds.) Organised Industrial Relations in Europe .What Future? (Aldershot: Avebury, 1995).

Janna Thompson, Justice and World Order. (London: Routledge, 1993).

L. Ulman, Barry Eichengreen, and William Dickes (eds), Labor and an Integrated Europe (Washington: Brookings, 1993), particularly art. by Schmitter.

The Debate on Sweden:

Ton Notermans. "The Abdication from National Policy Autonomy: Why the Macroeconomic Policy Regime Has Become So Unfavourable to Labor," Politics and Society, vol. 21, no. 2 (June 1993), pp. 133-167.

Ton Notermans, "Social Democracy in Open Economies: A Reply to Jonathon Moses," Politics & Society, vol. 22, no. 2 (June 1994), pp. 149-164.

Jonas Pontusson, "The End of the Third Road: Swedish Social Democracy in Crisis," Politics and Society, vol. 20, no. 3, 1992.

Special Issues of Journals:

Daedalus, The Future of the State, Spring 1995.
Economy and Society, The School of Regulation, Aug. 1995.
International Journal of Sociology, Work and Welfare in a Changing Europe (2 vols), winter 1994 and spring 1995.

CRC-Curriculum Resource Center
CEU Budapest, Hungary
Modified: May, 1996


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