It could hardly be denied that the state of international relations and political economy is subject to continuous changes. In the past several decades, there were numerous events that influenced the development of this area of concern. In general, one can state that the overall global order, which could also be described as the balance of political and economic powers in the world, evolves considerably (Narlikar 561). Currently, there are numerous trends that determine the development of the international political economy, simultaneously being the results of the certain actions of different countries’ governments (Belfrage & Gammon 223).
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In particular, multilateralism is arguably the most important trend among the variety of other ones. Nevertheless, it is argued that other factors and trends also have an immensely significant impact on the global political economy (Neville 22). Moreover, it is appropriate to observe that various powers influence each other reciprocally, thus creating the overall foundation for the development of the international political economy.
These observations contribute to the introductory description of the context in which this paper will be developed. Evidently enough, it is of high importance to profoundly understand the interrelated and complicated nature of the contemporary processes related to politics and the economy. The overall globalization of international relations contributes to their differentiation and evolution to a vast extent.
Accordingly, the purpose of this paper is to analyze and critically evaluate the current trends in the international political economy, referencing scholarly literature on the topic. The essay aims to answer the following questions: what perspectives on contemporary international relations in the context of economy and politics appear to be the most important, and could future trends be projected on the basis of the analysis of the current situation?
Multilateralism as the Major Trend in the Contemporary International Political Economy
The Changing Nature of the World’s Global Order
First of all, it is essential to observe the notion of multilateralism in order to put further reasoning in the proper context. The term “multilateralism” was coined at the beginning of the 1990s. In its most general and widely accepted sense, it refers to the approach to international governance that is characterized by the collective effort of countries towards the mutual goal. The emergence of this concept could be explained primarily by the fact that the bilateral approach that dominated the global politics and economy during the period of the Cold War. However, since then the trend for the emergence of new political and economic powers in the world continued to evidently shape the balance of global powers.
In the article written by Vezirgiannidou, the effects of this trend are profoundly discussed. The main idea that is promoted by the author is that currently, the world is experiencing the post-hegemonic phase, which is primarily indicated by the decrease in the influence of the United States on the global politics and economy. The author mentions the governance of President Obama as an example of multilateralism, as the president understood the importance of new rising power (Vezirgiannidou 639). Particularly, he reached to China in order to establish economic connections with the country that represents the new global power (Vezirgiannidou 639).
As Vezirgiannidou notices further, despite the efforts that were put by President Obama in the establishment of the multilateral approach, it is still far from the completion (644). The author state that as of now, the US government promotes multilateralism only on the informal level, while on the level of profound formal legislation the country remains neutral to the newly emerging political powers in the global context (Vezirgiannidou 651).
New Emerging Powers and Trends in the Context of Global Governance and Multilateralism
Further, since the importance of new emerging powers and trends as an integral part of the current global governance is discussed, it is appropriate to focus more on the investigation of these trends and forces. As it is mentioned in the article by Stephen, the current practice of international politics was primarily established in the 1990s; nevertheless, the emergence of the new powers on the scene of international affairs requires the implementation of changes to this institutionalized order (483).
The primary claim of the article is that new emerging powers are largely restricted in their development by the established system of the international political economy, but at the same time these forces have an immense impact on the system itself, causing it to change eventually.
Based on this claim, the author elaborates on various trends and topics related to the identified area of concern. However, the most important idea that could be retrieved from his work is that developing countries, which primarily represent the newly emerging powers in terms of economy and politics, are dedicated to the policy of multilateralism. It is worth mentioning that the author also acknowledges the importance of the countries’ conflicting interests as the driving factor for the institutional change. Nevertheless, the primary emphasis is put on the fact that multilateralism is used by developing countries as the means of achieving their goals. Thus, these emerging powers continue to profoundly influence the overall structure of the international political economy.
The Impact of the Global Economic Organizations on the Establishment of Multilateralism
In the context of the discussion of the multilateral approach to the international economy and politics, it is of high significance to observe the role of global economic and monetary organizations, regarding their impact on the promotion of multilateralism.
Particularly, in the article by Vestergaard and Wade, the authors dwell upon the discussion of the International Monetary Fund (IMF) and the World Bank as the organizations that have an immense influence on the global economy (1). Vestergaard and Wade also argue that the hegemony of the United States on the international scene evidently comes to an end as the new economic and political powers emerge currently.
Primarily, it is claimed by the authors that the power shifts towards the East in general and to developing countries in this region (as well as in other parts of the world) accordingly. The authors also mention the fact that the global financial crisis had a vast impact on the changing of the balance of powers in the world. However, it is stated that reforms that were implemented by the International Monetary Fund (IMF) and the World Bank are not sufficient for the promotion of the multilateral approach to international politics and economy (Vestergaard & Wade 2). For example, Vestergaard and Wade mention that developed countries have a considerably larger share of votes in the mentioned organizations, which is an apparent imbalance regarding the developing countries (6).
Accordingly, it is possible to preliminary conclude that, based on the discussed academic sources, it is apparent that multilateralism is one of the most important trends in the contemporary international political economy. Moreover, its importance is recognized primarily by developing countries, which perceive this approach as the means of gaining a more sustainable position in the international political and economic order. However, the developed countries, such as the United States, have the tendency of implementing the multilateral approach insufficiently. Nevertheless, it could be projected that in the future the newly emerging political and economic powers will eventually shape the face of modern international relations.
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Other Trends and Issues Related to the International Political Economy
Rationalism and Non-Rationalism in the Context of the International Political Economy
It is also highly important to discuss other trends and issues in the context of the international political economy. For example, the article by Amin and Palan dwell in the discussion of the tendency of the international political economy to acquire a more non-rationalist approach in recent years (559). The article was written and published at the very beginning of the 20th century, and it is possible to state that largely predicted the trends that are going on currently.
The end of the hegemonic world order, as well as questions related to indeterminacy, non-linear evolution, and bounded rationality, were discussed by Amin and Palan (559). Also, it was mentioned by the authors that the international political economy (IPE) “has to be transdisciplinary, not the exclusive field of politics and economics, as is so often assumed in mainstream IPE” (Amin & Palan 566). Thus, it is apparent that the authors predicted the majority of the current trends in the sphere of international affairs.
The Contemporary State of the International Currency System
The state of the international currency system also reflects the changes that are experienced by the world in terms of economic issues. The study by Cohen and Benney focuses on the debate about the shape of the international currency system. In general, the authors come to the conclusion that the international economy is evidently moving toward the multicurrency system (Cohen & Benney 1018). It could be noted that the identified trend is logical in the current circumstances. As it was identified previously, multilateralism has an immense impact on how economic relations are established and changed in the modern world. Accordingly, the trend for a more polarized currency system appears to be appropriate in this context.
The United States Foreign Policy in the Middle East
The policies that are implemented by the United States in the Middle East could also be considered as part of the global changes in the international political economy. As it was already mentioned in the paper, the governance of President Obama marked the start of the US government’s movement toward the implementation of the multilateral approach to politics and the economy. Accordingly, given the fact that the current geopolitical landscape is also subject to change, the US government attempts to implement policies that would help it to preserve its dominating position in the international relations system at least to some extent (Krieg 97). Therefore, the United States’ political activities in the Middle East also reflect the inevitability of the changes for the global order.
The Concepts of Proximity, Distance and Diversity
Lastly, it is critical to mention the importance of the concepts of proximity, distance, and diversity in the context of the overall topic of this paper. It is not surprising that the overall trend for globalization has a crucial impact on how economic infrastructures are shaped and changed currently. The work by Oinas explores the significance of the mentioned concepts in the context of the continuously globalizing world.
It is apparent that currently various companies have to establish economic relations with organizations from other countries. It is especially relatable to the case of developing countries that, due to their increasing importance in the modern economic and political scene, have to implement long-distance relations with their partners (Oinas 307). Accordingly, it is possible to state that the contemporary economy becomes more distance-oriented. Therefore, it is highly important to consider this trend in order to fully understand the contemporary changes in the international political economy.
In conclusion, it is essential to summarize the primary aspect of this paper. First of all, a comprehensive introduction to the topic is provided. It allows the reader to understand the overall context in which the paper is written, and it also provides the basis for the development of the purpose of the essay. In the process of the literature research as well as the retrieving of the information from the gathered sources, it became apparent that several highly important trends exist in the international political economy. In the context of the research question of this paper, it is possible to state that multilateralism is one of the most important trends among the existing ones.
Additionally, there are also other trends, which are connected to the issue of the changing nature of the global order. These trends were observed in the paper, and it could be concluded that the world is moving toward a more polarized and multilateral political and economic structure.
Amin, Ash, and Ronen Palan. “Towards a Non-rationalist International Political Economy.” Review of International Political Economy, vol. 8, no. 4, 2001, pp. 559-577.
Belfrage, Claes, and Earl Gammon. “Aesthetic International Political Economy.” Millennium, vol. 45, no. 2, 2017, pp. 223-232.
Cohen, Benjamin J., and Tabitha M. Benney. “What Does the International Currency System Really Look Like?” Review of International Political Economy, vol. 21, no. 5, 2014, pp. 1017-1041.
Krieg, Andreas. “Externalizing the Burden of War: The Obama Doctrine and US Foreign Policy in the Middle East.” International Affairs, vol. 92, no. 1, 2016, pp. 97-113.
Narlikar, Amrita. “Negotiating the Rise of New Powers.” International Affairs, vol. 89, no. 3, 2013, pp. 561-576.
Neville, Kate J. “The Contentious Political Economy of Biofuels.” Global Environmental Politics, vol. 15, no. 1, 2015, pp. 21-40.
Oinas, Päivi. Proximity, Distance and Diversity: Issues on Economic Interaction and Local Development. Edited by Arnoud Lagendijk, Routledge, 2005.
Stephen, Matthew D. “Emerging Powers and Emerging Trends in Global Governance.” Global Governance: A Review of Multilateralism and International Organizations, vol. 23, no. 3, 2017, pp. 483-502.
Vestergaard, Jakob, and Robert H. Wade. “Still in the Woods: Gridlock in the IMF and the World Bank Puts Multilateralism at Risk.” Global Policy, vol. 6, no. 1, 2015, pp. 1-12.
Vezirgiannidou, Sevasti‐Eleni. “The United States and Rising Powers in a Post‐hegemonic Global Order.” International Affairs, vol. 89, no. 3, 2013, pp. 635-651.