International Political Economy
Very often politics is anxious about the activities dealing with cooperation and conflict both, inside and between the societies of particular countries, at the same time people as usual go about organizing the apply, production, creation and sharing of human, natural, state and other resources during the manufacturing and reproduction of biological, natural and social life of society. Speaking about the disciplines of Political science and political economy, it is necessary to mention that they engage the methodical studying of this aspect of the existence and activity of the society. As a result people can understand and explain the way the politics works (Becker,2006: 23). One of the main aims of the politics is to recognize particular functions and arrangement of power within the society and find out and settle on those who possess power and determine the methods of applying it. While trying to study and examine politics it is important to be familiar with the importance of political theory. With the help of the theory one can clearly interpret, define and understand the reality. The studying of the theory helps to define the focus and differentiate what is significant from what does not present any importance.
Needless to say, that not all the theories can be defined as identical because each theory has its certain consequences and is better prepared to clarify the aspects of social and political reality while others are not ready for that at all (Becker, 2007: 68). Taking into account the above mentioned definition of politics and focusing on studying these relations, it will be necessary to determine where they arise. Probably, this, probably, is the most difficult about studying political theories. Politics cannot be applied and used in a sole aspect of life, as it occurs within the whole society and develops and changes according to the amendments that society undergoes. Moreover, politics comprise each aspect of live, but in particular it is concentrated in the state of modern nation. That is why political actions and adopted laws are not always relevant for all spheres of life and cannot fit every state, as each country has its own peculiarities. That is why many political reforms, political tendencies and movements depend upon certain factors, including national peculiarities, human and natural resources and, obviously, relationships with neighbor countries and nations.
Economic and political theories do not always reflect how things work in the real world, as in most cases theory differs greatly from reality. The history of politics is rather long and it is presented with a great number of political movements, theories and tendencies. Each of them was presented during the certain period and had rather great influence upon the development of societies and nations. Politics witnessed a lot of theories their application by the governments had absolutely different or mixed results. Studying political and economic theories, their effectiveness, work and effect on the society it is necessary to pay attention to the liberal and non-liberal theories and consider their work.
Liberalism is one of the oldest and most influential and effective movements. It influenced the whole Europe in the 1800s. Liberals stood for the individual liberty and supported the Enlightenment ideas and theories as well reforms and principles of the French Revolution (Mises, 2010: 51). The main ideas of the liberal economic theory were freedom of conscience, liberty of thought and speech, liberty to follow one’s own economic interests by means of free trade and contest. All these principles preserved their relevance till modern times and had greatly influenced modern liberal theories. Liberalism is the conviction in a representative and constitutional government. According to the principles of liberal theory, democracy was not supported and considered to be appropriate power. Liberals had strong believes that only rich men with property could enjoy the right to take part in politics. Liberals believed in equivalent treatment, regardless of prosperity or social position (Rawls, 2005: 48). Sure, the ideas of liberals sounded reasonable, but they did not find the absolute support after being applied. The results of this theory were somewhat mixed as the most part of population still supported the democratic points of view.
With the disintegration of the centrally controlled economies and the dictatorial governments and states of Western Europe and the republics of former Soviet Union, politicians are, with the help of the substantial support from the public, espousing liberal economic and transformations of the politics – the reorganization of markets, the preserving of civil and political rights and new establishment of representative governments. But those who supported the reform had a lot of targets, and the liberal theory in which they search for a political direction is not an unmistakable doctrine (Manent and Belinski, 2000: 47).
The application of liberal theory had different results and consequences. Some events that happened in the world can place in question the effectiveness of the liberal theory (Gray, 2006: 67). The attacks of 09/11 were intended to cause terror and it is also considered as a harmful act. The USA was not ready for such action that is why it led to the terrible consequences. The main aim of liberal economic theory and government is provide people with individual freedoms, the same opportunity, particular individual rights. These rights include keeping the nation and country’s population safe and preventing people from damage.
After the 09/11 attacks, the rights and security of the population of this country were violated and broken. As a result the main ideas of liberal reforms and theory failed and people saw the ineffectiveness of it. Surely, it would be mistaken to state that the liberal theory does not work at all, but in the case described above, some of its principles failed and demonstrated that this theory is not absolute and ideal.
One more question under discussion is the applying of neo-liberal economic theory and its practical effects people and society (Harvey, 2007: 46). This theory, as well as liberal one is not pure and positive as it may seem from the first sight and it had both, positive and negative results. A new hegemonic government was characterized by the internationalization of assets and forwarded to create such economic condition, where the zones of a free trade free trade become the locus of utilization and the domination over the workers (Scoulars and Sanders, 2006: 87). The regime that appeared after the neo liberal theory came into power was characterized by the supremacy of international resources and capital over the domestic and state capital. The neo liberal economic theory led to the creation of the export-led factory regime on the basis of the zone of free trade. This regime resulted in some kind of order in which industrialized and manufacture jobs increased the positions of the First World and then relocated in the Second or Third Worlds, characterized by the cheap human labor and plentiful human capital (Reinhardt, 2009). Such matter of affairs led as a result to the development of capitalism and prevalence of the rich upon poor population.
The representatives of the neo-liberal theory had the pessimistic points of view on the human nature. The essential idea was that all human beings would always try to favor and support themselves. This idea was also applied in the sphere of public offices. As a result, the state witnessed the development and high level of corruption and according to the neo-liberal theory the rise and development of corruption was regarded as an automatism. From the point of view of neo liberals the only way to reduce corruption and prevent this phenomenon in future was reduce public sector as far as possible in order to create a free market. If we think about it rationally, he only opinion comes in mind: neo –liberal theory leads to the recession and lack of progress. According to the neo-liberal theory, the perfect man is analogous to Robinson Crusoe with limited authority and alternatives. The neo liberal theory was applied to the sector of national economy and enterprises. For instance, in Chile each nationalized enterprise was sold to the Chilean or foreign investors or was given back to the previous owners. Sometime later, agricultural companies were privatized as well. The only problem consisted in the irrational division of the lands that were given to both, big landowners but and small farmers who were not able to live on without subsidies. This led to in a high amount of bankruptcies.
The paper contains some examples of the results of the ways liberal and neo-liberal theories work after their implementation in politics.
Becker, G. (2007) Economic Theory, Los Angeles: Transaction Publishers.
Becker, G. (2006) The Economic Approach to Human Behavior, Chicago: University Of Chicago Press
Gray, J (2006) Two faces of liberalism, New York: New Press, The
Harvey, D. (2007) A Brief History of Neoliberalism, Oxford: Oxford University Press, USA.
Mises, L. (2010) Liberalism, London: Ludwig von Mises Institute.
Rawls, J. (2005) Political Liberalism, Columbia: Columbia University Press.
Manent, P. and Belinski, R. (2000) An Intellectual History of Liberalism, Princetone: Princeton University Press.
Scoular, J. and Sanders, T. (2006) Regulating Sex/Work: From Crime Control to Neo-liberalism. Boston: Wiley-Blackwell
Reinhardt, U., 2009. Companies: What Are They Good For?. New York Times, [online] (Last updated 9.47 AM on 04th May 2010) Available at: < http://economix.blogs.nytimes.com/2010/05/14/companies-what-are-they-good-for/?scp=2&sq=liberal%20theory&st=cse> [Accessed on 23 October 2010].
The British Encyclopedia (2000) London: Roydon.
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