International political economy (IPE) deals with structures of political and economic transactions that move beyond state borders. IPE describes the global power dynamics that control international trade and finance, fuel globalization, and wealth distribution across the globe. It is mostly concerned with cooperation, political influence on the market, economic development, globalization, and international trade. Globalization has fostered international trade where different states interact through financial transactions involving imports, exports, and tariffs. Although globalization is supposed to promote equality in wealth distribution, most multinational corporations profit at the expense of individuals in less developed nations. Krugman (1993) acknowledges misconceptions in international trade and globalization, claiming that Americans should leverage resources and production processes to support economic nationalism. IPE has continued to support economic nationalism, capitalism, and liberalism, which has increased inequality in the market. Sachs (2011) argues that globalization and the emergence of political economics have led to the increased depletion of natural resources. This phenomenon continues to exert strain on limited resources, mainly due to greed advanced by the rich to accumulate more wealth.
Democratization is a critical process that contributes to increased freedom when a democratic regime replaces an authoritarian one. This is followed by democratic consolidation, where respected and legitimate democratic institutions are integrated into the state’s political culture. Democracy allows nations to enhance economic and political development by serving individual, state, and global needs. It promotes equality and citizenship that fosters a conducive international environment to interact with other states. O’Donnell and Schmitter (1986) claim that ‘order’ created by authoritarian regimes becomes ‘disorder’ when important actors abandon the movement. Huntington (1993) describes the various waves of democratization with a significant emphasis on the third wave, which began in the 1970s to date. The emergence of democracy ensures a continuous renewal of the system through elections forming new policies and coalitions.
Global terrorism concerns are widespread in the 21st century, starting with 9/11 to small-scale common terror attacks. Terrorism affects both the institution of democracy and the advancement of IPE strategies. Terrorists justify their actions by retaliation, collective responsibility, and method of last resort. Homer-Dixon (2009) claims that terrorists exploit the security system’s weaknesses aided by technological advances that produce weapons of mass disruption. Terrorism can cause significant divisions in a country leading to national disintegration and loss of democracy. Global communications and information flow promote terror networks that assist terrorists in lodge attacks in different regions. Therefore, interconnected networks develop complex measures that support their destructive agenda.
IPE, democratization, and terrorism borrow from similar theoretical foundations, although each concept differs significantly based on the context. In IPE, technological advances enhance political and economic development between states and create a power cycle for wealthy companies. Also, through economic liberalization, government interference in markets is limited. On the other hand, principles that advance IPE, such as globalization, contribute to depleting natural resources and enhancing terrorism worldwide. Without the increased interconnectedness, terrorism would remain largely localized and easy to control. Further, democratization borrows heavily from realism and liberalism theories, where countries seek to advance the national interest and become significant players in the global economy. Theoretical assumptions perceive democracy as a way of achieving equality, whereas IPE promotes market inequalities. In that case, theories explaining IPE, democratization, and terrorism are inseparable as one factor produces both positive and negative attributes depending on the context.
References
Homer-Dixon, T. (2009). The rise of complex terrorism.Foreign Policy. Web.
Huntington, S. P. (1993). The third wave: Democratization in the late twentieth century (Vol. 4). University of Oklahoma Press.
Krugman, P. R. (1993). What do undergrads need to know about trade? The American Economic Review, 83(2), 23-26.
O’Donnell, G., & Schmitter, P. C. (1986). Tentative conclusions about uncertain democracies (Vol. 4). Verlag Nicht Ermittelbar.
Sachs, J.D. (2011). Need versus greed. Project Syndicate. Web.