Neoliberalism

I44027 Rongrong Wang

I43011 Fei Cao
Contents :

• Introduction
• How it emerge
• Barriers of international cooperation
• Three broad difficulties in the international institution design
• Neoliberalism in economics
• Neoliberalism in politics: Liberal institutionalism
• Comparisons among neoliberalism and other theories
• Neo-Neo debate under globalization
1.The concern of neoliberalism: how to achieve cooperation among states and actors in t
he international system.

2.Same belief as neorealism: international cooperation can be difficult to obtain (fear and
uncertainty among the anarchic international environment)

3.Different form neorealism: there was particular historical development in 20 century that
made international cooperation easier to achieve (neoliberalism has relatively grate faith i
n the ability of human beings to obtain better collective outcomes)
How did it emerge

1.1960s and early 1970s’s pluralism

pluralists argued: state boundaries were becoming increasingly permeable:the emergenc

e of ‘transnational relations’ and cross-national interaction

2.1980s’structural realist arguments of Kenneth Waltz

3.1983 Stephen krasner”international Regimes” :further developed

Barriers of international coorperation

1.States may fail to cooperate because they lack information about one another’s true
preferences

2.Fearing others will take advantages arrangement by cheating

3.Concerning that others will free-ride on the back of cooperation efforts

4.Transaction costs,unknown consequences and penalties and so on are too great to risk t
he effort

Conclusion:Even states shre a common interest,significant barriers still exist

3 barriers of international coorperation
institution design

1.Bargaining
2.Defection
3.Autonomy
1.Bargaining

In order to achievea collectively-agreed decision,states need to make rules and procedur

es,institutions.Thus,bargaining procedures varies according to particular issue areas and its
institutions.

PS:Great powers can have more influence over international negotiations and their outco
mes
2.Defection

States may be fear that their partners may fail to live up to mutual agreemmets or other st
ates may take free-ride from their cooperative efforts.

PS:Institution can play a role in alleviating two important aspects of defection-compliance

and enforcement
3.Autonomy

International institutions facilitate self-interested cooperation,it is not always clear that out
comes are due to the presence institutional specifically.

PS: International institutions are created by states to serve their self-interests.How is possible
tp disentangle the effects of state interests from attributes of international institutions.
Neoliberalism in economics: positive

Neoliberalism economic: laissez faire economics.

Achieve and maintain free market: deregulating capital markets, ending
protectionism, reducing government control by implementing austerity
and privatization programs.

E.G: Positively in 1960s, Latin American. Neoliberalism at that time was a

way to control social inequality and monopoly.
Neoliberalism in economics: negative
For classical liberalism: permissive to markets.
Let markets control themselves and they’ll solve their own problems.

For Neoliberalism, emphasizes privilege to rich people. (more corrupt)

Rich people make the world work and need to free of any constraints that might slow
them down.

Greater emphasis on government involvement in economic policymaking.

It rejects the welfare state, heavily promotes capitalism and defends the
concentration of wealth and unequal distribution of property and natural resources.
Comparison in economics:

E.G
Liberalism: businesses owned by the workers and not owned by shareholders who lack the
skills to run the business
Neoliberalism: encouraged privatization, disregards labor conditions, and would not
advocate workers cooperatives
Neoliberalism in international politics:
Neoliberalism refers to neoliberal institutionalism in international politics.

How do institutions need to be brought into international system?

Starter: Structural realist, Kenneth Waltz
Anarchic system------States compete, balance of power----weakers to balance against

Structural realists say states can cooperate but on an ad hoc basis: limited, unsustainable
Key ideas of neoliberalism: (1) ideology
Neoliberalism: enhance interstate cooperation and mutual gains by increasing information
about institutions and compliance to agreements.

Key assumptions:
 States are key actors, but not the only significant actor.
 All actors are rational. States want absolute gains rather than relative gain.
 The obstacle to cooperation can be addressed by international institutions.
 International institutions are neutral.
 If institutions are seen mutually beneficial by states, the will shift their loyalties to institutions.
Key ideas of neoliberalism: (2) institutions
Fundamental concept:
Interdependence: mutual dependence, reciprocal effects. non-use on military force.

Neoliberals: institutionalization reduces the destabilizing effects of multipolar anarchy.

states rely more heavily on institutions for their own selfish reasons, and institutions are more
positively as enabling states to achieve mutually beneficial outcomes.

3 forms:
1.Formal intergovernmental or cross-national, nongovernmental organizations: purposive
entities, bureaucratic organizations with explicit rules and missions. E.G. UN
2. International regimes: explicitly agreed rules by government which deal with particular
issues. E.G. the Law of the Sea Regime. Environmental regime. Nuclear nonproliferation
regime.
3. Convention: informal institutions with implicit rules and understandings that allow actors
to understand one another and coordinate their behavior. E.G. Reciprocity. Diplomatic
immunity
Structural realism & neoliberalism

Neoliberalism: accepted core assumptions of realism

(1) states are the principle actor (2) the behavior of states is rational (3) considerations of
power lies at the center of international politics

What neoliberals don’t accept from structural realism?

Anarchic system has wholly negative implications for cooperation. They tried to show
that cooperative behavior can develop in an anarchic international system with no
central authority to regulate their behavior. Cooperation will be terminated immediately
since issues got solved. Organization even will not last.
liberalism & neoliberalism

Neoliberal: Human nature is complex.

States will not cooperate with one another except in response when confronting a
dangerous concentration of power.
Emphasize deeper capitalism.

Classical Liberalism: The importance of education, morality, and inherent good in

human nature.
People prefer cooperation than conflict in nature.
Emphasize on individual liberty.
 Neorealism & Neoliberalism
Similarity :Neorealist and neoliberals realize the human nature is complex .

Difference:
 Focused issues: Neorealism: security, military issues.
Neoliberalism: fluid global issues. E.G political economy, environment, human rights
 Absolute and relative gains: Neorealism: relative gains
Neoliberalism: all will benefit from absolute gains, no concern on relative gains.
 Probability of paticipance: Neoliberalism: persuaded to cooperate if functional.
Neorealism: barriers to international cooperation: ambiguous information and the
relative gains of other actors.(trust-enhancing functions, E.G. monitoring and publicizing cheating.)
 View of foreign policy: Neoliberalism: managing complex interdependence and mutual interests.
Creating, maintaining, and further empowering institutions is the future of foreign policy.
Neorealists see foreign policy as dominated by issues of national security and survival.
What is left out from Neo-Neo debate?

Both theories assume that states are value maximizers and that anarchy constrains the
behavior of states.

However,

If the internal make-up of a state matters international society. All politics is now
'glocal‘ must pay attention to what goes on inside a state. Issues of political culture,
identity, and domestic political games must be considered.
Neo-Neo debate under globalization:

 Neorealism: deny the state is being pushed aside by new global actors. The state
remains the primary force in international relations and has expanded its power to
effectively manage the processes of globalization. They worry about inequality in
the economics may be the greatest security threat in other fields in the future.

 Neoliberalism: states will rely more heavily on institutions for their own selfish
reasons. They believe that international institutions face challenges in globalized
world, there is a growing need for the regulation and management that they
should provide, thus, they are lacking in both power and legitimacy necessary for
taking on heavy responsibilities.
THANK YOU
Question:

 To what degree do you agree that defection can be minimized, by what kinds of
means?

 Which theories explain the most? Which theory helps you make sense of this world
so far?

 Do you think globalization has any impact on neo- realist and neo- liberal thinking?
Is either theory useful in trying to explain and understand the globalization process?