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Conceptions of Politics and Economics in Post-States and Markets IPEThe World Turned Upside down? Globalization and the Future of the State by R. J. Barry-Jones; Contesting Global Governance: Multilateral Economic Institutions and Global SocialMovements by Robert O'Brien; Anne Marie Goetz; Jan Aart Scholte; Marc Williams;Privatization, Corporate Governance and the Emergence of Markets by Eckehard F.Rosenbaum; Frank Bnker; Hans-Jrgen Wagener; Governance in a Globalizing World b ...Review by: Ben O'Loughlin

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a]RoutledgeReview of International Political Economy9:2 Summer2002: 401-412 Taylor&FrancisuGroup

Review ArticleCONCEPTIONS OF POLITICS AND ECONOMICSIN POST-STATES AND MARKETS IPE

R.J.Barry-Jones, Theworld turnedupsidedown? Globalizationand thefutureof the state, Manchester: Manchester University Press, 2000, 292 pp, ISBN0-7190-5101-0.Robert O'Brien, Anne Marie Goetz, Jan Aart Scholte, Marc Williams,Contesting Global Governance:Multilateral Economic Institutions and GlobalSocialMovements, Cambridge: Cambridge University Press, 2000, 260pp,ISBN 0-521-77440-3Eckehard F. Rosenbaum, Frank Bonker and Hans-Jurgen Wagener (eds)Privatization, CorporateGovernanceand the Emergenceof Markets, Basing-stoke: Macmillan, 2000, 284 pp, ISBN 0-333-77892-8.Joseph S. Nye and John D. Donahue (eds) Governancein a GlobalizingWorld,Washington, DC: Brookings Institutions Press, 2000, 386pp, ISBN0-8157-6408-1.In the light of a discipline labelled 'international political economy' it isworth asking what an established IPE-ist refers to by the politicaland theeconomic.Notwithstanding the promising directions open to IPE scholars,such a basic question can be overlooked. But recourse to the abstractionof concepts can take us to the heart of what IPE is about and for, andallows us to situate current literature within the discipline's canon. Suchan exercise, furthermore, allows us to distinguish between positive andnormative propositions in IPE.

Until the end of the Cold War, and for a few years after, the matterwas relatively straightforward: in international affairs politics was some-thing done by states, economics the behaviour of market actors belong-ing to states, or of states themselves, acting independently or jointly. Itwas perfectly appropriate for Susan Strange (1988) to title her introduc-tion to IPE States and Markets.Since then three broad steps or 'generations'of conceptions of politics and economics have emerged: first, the glob-alization debate; second, managing governance or politics lost; andthird, politics regained. After drawing out conceptions implicit in these

Review of InternationalPolitical EconomyISSN0969-2290print/ISSN 1466-4526online ? 2002 Taylor & FrancisLtdhttp: /www.tandf.co.ukDOI: 10.1080/09692290110126155

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REVIEW OF INTERNATIONAL POLITICAL ECONOMYgenerations we shall assess how four books recently published, each witha different focus and intent, 'fit in', challenge or enrich these prior under-lying conceptions of politics and economics, and where this leaves ourunderstandings of politics and economics in IPE today.'The focus of enquiry for the First Generation was globalization, anda polarization swiftly emerged. On one side globalist gurus gleefullydescribed and prescribed the transfer of power from state to market, cit-ing whirlwind forces of change exogenous to the state - a liberating syn-ergy of information and communication technologies (ICTs)and financialderegulation - rendering national borders less relevant and the nation-state in retreat (Strange, 1996) or at an end (Ohmae, 1995). The globalistanalyses sought to describe a powerful logic: exogenous forces and neo-classical economic 'facts' left the state with 'no alternative' but to adapt,which reinforced, concretised and legitimated this view of globalization.This view was denied by localists,for whom 'globalisation [wa]s not new'(Krasner, 1994: 13). Control remained with the state - and should remainwith the state to preserve fairness through welfare and to constrain mar-ket volatility. Insofar as 'globalisation was an accurate model, financialderegulation had been a deliberate state policy' (Helleiner, 1995), pro-duction had remained home-state oriented rather than de-territorialized(Hirst and Thompson, 1996; Ruigrok and Van Tulder, 1996; Weiss, 1998),and indeed technological and business development were a function ofnational institutional and social arrangements (Zysman, 1996). For bothglobalists and localists politics meant states and economics referred tomarkets. Both theories posited a zero-sum battle between two separatespheres of activity.Second Generation approaches converged around one model of state-market relations, based upon Cerny's (1993) 'competition state', andrecognized that this model now existed within a more complex, multi-level, multi-actor IPE. Previous hubris and selective use of data calmed,as writers from both globalist and localist camps acknowledged themutual benefit derived from the interplay of market and state power.As had long been the case, but for a while forgotten, states dependedon market actors for wealth, employment and status, while market actorsneeded states to provide infrastructure, a competitive culture and agenerally 'efficient economic system' (Dunning, 1997: 118; Porter, fromGibson (ed.) 1998). However, the state was no longer the sole providerof these 'governance' functions - globalist writers pointed to non-state(private, NGO-led or cyber) governance (Sassen, 2000), while localistssuch as Hirst and Thompson (2000: 69.) conceded the state was now alocus holding together a 'sutured' architecture of sub-, inter- and supra-state actor governance. For the Second Generation then, politics andeconomics remain separate spheres, but were no loner thought to be inzero-sum conflict, or to feature only unitary states and market actors.

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O'LOUGHLIN: CONCEPTIONS OF POLITICS AND ECONOMICSA more complex picture was recognized, but no advance was made onwhat politics and economics are, or how they work. Indeed, politics -relabelled 'governance' - shrank to a matter of managing-away conflictand instability.2A conceptual advance comes from Third Generation approaches. Here,networks and institutions are the key units of analysis, taking us beyondmarkets acting on states or they on markets. For example, the socialcontests within a British firm will cause the firm to choose a strategyreflecting the UK societal context as well as members' perceptions of theinternational environment (Amoore, 1998). Instead of state or marketpower, a Third Generation approach would discuss political and econ-omic power played out across public and private governance institu-tions by public and private actors with cross-cutting interests. Wherestates were the concrete realization of politics, now politics is realizedin new diffuse (less democratic) ways, and where markets were theconcrete realization of economics, now it is suggested that the exchangeof resources depends on the interaction of groups of people, each withdiffering power, within institutions. This is not to reduce politics andeconomics to one phenomenon, rather that within this 'ensemble ofgovernance' (Underhill, in Lawton et al. (eds) 2000: 118.) there is a tensionor balance. For example globalisation's challenge to the state was notdue to exogenous forces, but due to private interests - market actorswith a neoclassical belief in unchecked market expansion and an inter-est in open borders - using their influence within governance net-works to push deregulatory policy. Changeis central to Third Generationapproaches:3 first, if private interests can gain asymmetrical advantagewithin policy networks this could also be reversed; second, 'soft' powerand the importance of perception rather than coercion allows the usurp-ing of traditional power-players - offering emancipatory and democra-tizing developments to emerge; and third, politics cannot be designedaway through optimal governance. The reconsideration of positivepropositions revitalizes normative challenges to the prior conservativeemphasis on status quo-preserving management.As his title suggests, Barry-Jones' The world turned upside down?Globalizationand thefuture of the state is a Second Generation piece ofthinking which often concerns itself with First Generation questions.According to Barry-Jones the concepts of globalization, the state, anddebates concerning them are unclear, and his task is to clarify thesemuddy waters, without taking up a clear position himself. Chapter 1 setsout this triple whammy of complication: first we are told that the modernstate is a varied and debatable institution, in practice and in principle,and that this complicates any discussion of globalization's impact on 'the'state. We are told, second, that the globalization debate s equally varied,the extremes of utopianism and rejectionism bordering a more reasoned

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REVIEW OF INTERNATIONAL POLITICAL ECONOMYdebate between those who believe recent changes constitute a new,'strong globalization', and those favouring a 'weak globalization' or inter-nationalization. Barry-Jonescompletes the picture of confusion by notingthat evidencean be used to support either position, making a conclusionimpossible. He uses the rest of the book to address the evidence anyway.To exemplify his method of assessing evidence to raise questions,Chapter 2 asks whether globalization is anything new (a questionedasked by First Generation localists), historically comparing the currentso-called globalization era with late nineteenth-century internationaliza-tion. Both eras featured one hegemon, technological innovation, rapidgrowth of international trade, financial integration, increased migrationand growing inequality between states and social groups. Novelty is thekey to the globalization thesis however - the compression of time andspace bring a qualitatively different world. To conclude the comparisonBarry-Jones leaves the question of novelty hanging: he asks what conse-quences must be realized for such a qualitative shift to occur? Until itis established whether a qualitative shift has occurred, a more usefulquestion would be whether 'history' is best utilized by mere point-by-point comparisons.

Addressing the roots of globalization (Chapter 3) Barry-Jonesincludesa range of factors - states, technology, economics and market actors,and social and cultural sources. In his analysis, the decisions and non-decisions of the post-war (mainly US) state was the major causal forcebehind globalization, e.g. failure to constrain MNCs or develop finan-cial regulation. Multilateral pressures were state-led - states set theagenda, developed rules, and implemented and blocked policy. Barry-Jones recognizes the 'asymmetry in state power and subsequent process'(p.64), i.e. state power was diffused to other actors, but he underesti-mates the continuity of complexity. For example, 'US decisions' can bedisaggregated to show that the construction of Bretton Woods and theCold War Balance of Power were the outcome of a coalition of actorswithinthe US - the corporate sector, conservative politicians, and mili-tary strategists - seeking to redefine the politicaland the economicntheir interests. The political in this discourse became the inter-national,building up the US military/industrial complex and its European alliesto oppose the USSR, while the economic became the global,.e. integratedworld markets, a revived European market and general support for bigbusiness over socialism and trade unionism. This more rigorous expla-nation of US strategy, a strategy labelled 'patriotic internationalism' byJim George (2001), emerges from a Third Generation notion of peoplein networks or institutions. Barry-Jones almost picks up this idea, not-ing that MNC decision-making is down to a small group of peopleand therefore globalization lies 'firmly within the realms of humandeliberation and choice' (p.71), but fails to apply this more widely.

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O'LOUGHLIN: CONCEPTIONS OF POLITICSAND ECONOMICSThe author himself appears pessimistic for future governance. Heargues the state has been weakened, able only to accommodate externalpressures. The subordination of popular will undermines the legitimacy

and support of democratic states, and a weakened state enfeebles inter-state institutions at a time when 'alternative agencies' (p.115), i.e. NGOs,are even less representative and lack the resources to enforce rulesand regulations. Yet Barry-Jones misses his own point concerning thevaried capacity of states to deal with varied globalization: the US has adominant influence within the Bretton Woods Institutions of the IMF,World Bank and WTO, and is pressing ahead with National MissileDefence. Precision is needed in terms of how different states are affecteddifferently, so that we might know how states - in conjunction withother non-state actors - can set about fulfilling necessary governancefunctions.The value of Barry-Jones'emphasis on the varied nature of globaliza-tion almost emerges when he suggests this unevenness 'has potentiallyprofound implications for humanity' (p.80), but this allusion to inequal-ity is never fully pursued. By contrast, the first page of O'Brien et al'sContestingGlobalGovernance:MultilateralEconomicnstitutions ndGlobalSocial Movements stakes an interest not just in academic debates but inthe people 'on the receiving end' (p.1) of the policies of multilateral econ-omic institutions (MEIs). As well as a deeper normative concern, thisbook defines its purpose and method exactly. Through a series of casestudies between specific MEIs (IMF, World Bank and WTO) and spec-ific global social movements (GSMs) (environment, labour and women'smovements) the authors investigate this 'collision' between two keyagents of governance, in particular disputes over the emerging form ofMELs,and over the content of their policies. The outcome of this collisionhas been the emergence of a 'complex multilateralism' with institutionalchange moving much faster than policy change. Complex multilateral-ism is evident from five findings of the book's case studies. First, inresponse to civil society actors, institutional change has varied. Second,the major participants are dividedby conflicting goals and interests, lead-ing to, third, ambiguous results as all participants can enjoy only limitedsuccess. Fourth, the collision has had differenteffects on different states,strengthening the strong and weakening the weak. Despite this, fifth,the authors find the policy agenda has broadened o include more socialissues. Clearly in this book we are in the realm of a Third Generationapproach, concerned with different actors working together in a positivesum manner to achieve differing but not antithetical outcomes througha changeable institutional architecture.O'Brien et al. provide an excellent introduction to those not immersedin MEI or GSM literature by unpacking two analytical categories. A focuson GSMs offers an analytical space to civil society, though there is a

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REVIEW OF INTERNATIONAL POLITICAL ECONOMYqualitative difference between national and global social movements,GSMs being less cohesive or uniform, e.g. the Southern contingent of aGSM will have fewer financial resources, be more suspicious of states,and with many different interests to their Northern allies. The authorsdevelop the concept of 'global civil society' but concede that society inmany regions is neither civil nor developed, and can be an arena of con-flict as much as cooperation. The diffuse nature of GSMs as institutionsmakes researching these global entities a problem, e.g. there are no 'rep-resentative' interviewees. This academic distraction unwittingly shedslight on a real problem - the lack of clear lines of accountability in GSMs- and while the authors seek to include the wide group of people andorganisations comprising a GSM their focus on NGOs represents a tacitadmission of the undemocratic nature of these movements.The positive sum nature of the MEI-GSM relationship is crucial, bothsides realizing they need the other in some way. Each MEI needs GSMsfor different reasons: the World Bank because its projects are most effectedby the disruptive or cooperative efforts of GSMs; the IMF engages withcivil society to counter criticisms and 'educate the public' to the wisdomof Structural Adjustment Programmes (SAPs); and the WTO engageswith labour and environmental groups to get the support of strong statesin which GSMs are influential. In contrast to MEI concern with the man-agement of governance, GSMs engage with MEIs to change their direc-tion and policy, and because MEIs increasingly establish developmentorthodoxy ahead of other state and non-state actors. So far MELshavegained more from the engagement, their goal of smooth managementand the blunting of opposition being more achievable than the long-term transformation GSMs seek - an 'uphill struggle' (p.224) the authorsconcede.

Politics and economics are closely linked within complex multilater-alism, for example the IMF's use of SAPs is a political decision utilizingeconomic sanctions to bring political reform and cultivate economicmarkets. If GSMs and MEIs are part of how politics works today thenclearly politics is much more than state activity, and is much less demo-cratic than state activity could be. Yet the role of GSMs offers, if not ina clear and accountable manner, voice to near-continents of people previ-ously excluded from political decision-making. Economics has finallybecome much more than a matter of markets. Rather the exchange ofresources is broadened and socialized: MEIs both shape market activityand act as agents of redistribution, while GSMs can represent the econom-ically vulnerable, challenge dominant economic ideas, and undermineor support MEI activity, thus affecting economic outcomes. Finally, forO'Brien et al. to describe the MEI-GSM relationship as a 'collision'reminds us that regardless of attempts to manage activity, trade-offs andchange are inevitable.

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O'LOUGHLIN: CONCEPTIONS OF POLITICS AND ECONOMICSThe socialization of economics, or rather the re-recognition that all(economic) relations are embedded4 in social and political relations, burnsthroughoutRosenbaumet al.'s Privatization, orporate overnancendthe

Emergenceof Markets. A Third Generation book which all economistsshould read, the authors analyse the unique and unprecedented priva-tization programme underway in Central and Eastern Europe anddestroy a number of assumptions. First, privatization is not a genuineeconomic objective:if the ultimate objective of the economic transformation is theimprovement of economic welfare through increased competitionand an efficient division of labour, the implementation of compet-itive markets is what matters most, and the role of privatizationmust be seen in the light of its relationship to that goal.(2001: 1-2)The recession that has hit transformation countries shows that swap-ping planning for private ownership - one co-ordination mechanism foranother - will not guarantee spontaneous market emergence or successfulmarket development. Further, the authors add, China now featurescompetitive markets without privatization.Second, privatization, markets and market institutions are a politicalproject, the outcome of political decisions, and in transformation coun-tries an explicitly stated objective (with the implicit objective of makingcapitalism popular). Chapters 2 to 4 show how privatization has variedacross transformation countries: in Poland privatisation was slow dueto a strong, centralized state; in East Germany privatization provedexpensive, hijacked by politicians and used as a tool of regional andsocial policy; and in Hungary, Poland again and the Czech Republic

privatization revenues varied not due to volume of sales but because ofpolicy design. Thus an 'economic' process is bound in political relations.The book's second section - exploring whether privatization improvedcorporate governance - yields no real pattern or conclusion. However,the third returns to whether the creation of an institutional frameworkthrough privatization and general economic restructuring really led tothe spontaneous emergence of markets, as in neoclassical economic the-ory. The answer is negative: preconditions do not beget markets, ratherthe building of market institutions and learning of market behaviouremerge alongsideand throughmarket activity. As Chapter 14 explains, thisis because the market mechanism is a communicative network whoseoperation depends upon the knowledge participants have about thenetwork. For example, the actual financial transaction in a market econ-omy is only the final stage of a long, decentralized process of offers, hag-gling, negotiating, being aware of other commodities available and theirprices, and being aware of rival buyers or sellers and their preferences.

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REVIEW OF INTERNATIONAL POLITICAL ECONOMYA market transaction, then, is founded upon information, knowledgeand mutual learning. Markets satisfy a formal definition of networksbecause they exist as 'patterns or regularities among interacting units'(Wasserman and Faust, 1994: 3, from Rosenbaum et al. (eds.) 2000: 226)and because 'communicative' market relations cannot be analysed byexamining individual units in isolation.The emergence of markets is an incremental process dependent uponparticipants' 'structural knowledge' of a market - knowledge of prices,the reliability of those supplying information on prices, and knowledgeof participants' own position within the network. Thus if participantshave great structural knowledge of a planned economy, they will havedifficulty adjusting and furthering a new market economy as they haveto build up new communicative relations. Using the twin concepts, com-municative network and structural knowledge, Rosenbaum et al. explainwhy once planned economies in the transformation economies of Cen-tral and Eastern Europe were ditched, markets did not spontaneouslyarise, but rather the process is a long, varied and often painful one. Notonly does their book explain a historical process, but from this uniqueexperience generalizations concerning 'the market' enrich the ThirdGeneration views of economics. Economics becomes the exchange ofinformation across networks of actors, where trust, knowledge and com-munication determine both price specifically and outcomes generally.The fourth book in question takes us full circle. Where Barry-Jonesasked well-worn questions regarding globalization and the state, O'Brienet al. not only added extra actors but showed how they worked togetherin specific cases, and Rosenbaum et al. took up this notion of agents innetworks interacting according to communication and knowledge.In Governance n a GlobalizingWorld, Nye and Donahue (eds) address allthese issues in a book that perhaps best represents, of those reviewedhere, where IPE is in 2001, from which we can interpret what politicsand economics mean at this moment.In their introductory chapter Keohane and Nye begin with Barry-Jones'old conundrums, but purport, by way of analytical certainty, to settle thequestions. This analytical certainty extends to three instances. First, glob-alization and de-globalization are the processes of increasing or decreas-ing 'globalism', where globalism is a condition - 'a state of the worldinvolving networks of interdependence at multicontinental distances'(p.2). Where the authors' old interdependence concept (1977) referred tosingle linkages, globalism refers to networks or multiple relationships ona greater scale than locality, nation-state or region. Second, globalism isconstituted by several (analytical) dimensions - economic, environmen-tal, military, and social and cultural - allowing a more subtle reading ofinternational affairs, e.g. we cannot simply say 'globalism rose/fell from1914-45', rather military globalism increased while economic globalism

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O'LOUGHLIN: CONCEPTIONS OF POLITICS AND ECONOMICSdecreased. Third, where Barry-Jones was unsure whether globalizationwas new, Keohane and Nye borrow from Held (Held et al., 1999: 21-2.):'The issue is not how old globalism is, but rather how "thin" or "thick"it is at any given time'. The Asia-Europe Silk Road represented thin glob-alism as it involved a small group of traders selling to an elite market,while the thick globalism of today sees multiple, intensive and extensiverelations affecting many people. Globalization is thus a thickening pro-cess featuring increasing density of networks, institutional velocity andtransnational participation. That we have arrived at thick globalism isevident from increasing 'network effects', e.g. expansion of trade (econ-omic globalism) has created new employment and pollution in devel-oping countries (social and environmental globalism), causing MEIs tointroduce new social and environmental regulations (economic global-ism), creating resentment in developing countries (social globalism).These new synergies make the world more unpredictable, indeed inher-ently uncertain, being composed of human beings5 trying to survive andprosper in a competitive environment.Rather than any global government, the current and immediate formof global governance for Keohane and Nye is 'network minimalism', net-worked because that is simply how activity proceeds - multiple actorsworking in a more or less co-ordinated way - and minimalist becauseglobal institutions should not intrude too far into the state's jurisdiction.Within the positive analysis, then, lies the normative point concern-ing the need for accountable and legitimate institutions, a role they feelonly the state can fulfil for the foreseeable future. Rather than simplyadding new actors to the mix of governance, the authors argue we arewitnessing 'not the obsolescence of the nation-state but its transforma-tion and the creation of politics in new contested spaces' (p.13). The factthat we have not reached markets so perfect that the state is sidelined isa 'useful inefficiency' (p.15) as it allows domestic institutions to evolvein a controlled manner workingin conjunctionwith non-state actors in net-works. Thus politics remains, contest continues, but in a transformedmanner.Design is a crucial aspect of this transformed politics, and while theproblems of the current design of governance institutions are discussedin many chapters of Nye and Donahue, this raises wider questionsabout the nature of design and conflict within the realm of politics. InCognlianese's chapter she begins by asking 'how does the choice of insti-tutional form influence the effectiveness of institutions in solving regu-latory problems associated with globalization' (p.298)? The design ofinstitutions not only affects how well they can deal with global problems,but also whether states support those institutions, resulting in a trade-off: how can MEIs reassure states yet derive the necessary independence?Equally, in discussing the downfall of the 'club' model of multilateralism

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REVIEW OF INTERNATIONAL POLITICAL ECONOMY- i.e. rich country ministers meeting in private to decide global rules -Keohane and Nye look at the current multi-actor landscape and ask 'howdo you get everyone into the act and still get action' (p.27)? It is thusimpossible to completely design-away conflict.Similarly, designing away the problems that are the focus of currentconflict will only create new problems. For example, the consciousnessof global problems partly created the need for global governance insti-tutions, but the 'democratic deficit' problem then arose. Were this to besolved, new power relations would exist which would be problematicfor some, e.g. an alteration to global core-periphery relations, more pres-sure on global institutions from an emergent global demos, less tech-nocracy may affect the quality of decision-making, less national allegiancemay bring instability, and so on. Were it not a zero-sum metaphor, wecould perhaps label the pushing of conflict from one issue to another'political hydraulics'. It is regrettable that this offers no salvation to socialscientists wishing for predictive power. A contradiction between inher-ent uncertainty and trade-offs versus the desire to somehow manage andimprove world affairs is present in Third Generation approaches such asO'Brien et al. and Nye and Donahue, and while it may provide a 'getout of jail card' in terms of absolving responsibility for predicting thenext financial crisis or regime collapse, the question must be posedwhether all scholars and agents of governance can do is learn fromhistory and keep redesigning.Yet the epistemology of the Third Generation softens this blow, under-lines the conceptions of politics and economics we have drawn fromthese books, and in doing so offers hope to those wishing for more thanjust refinement of global management. In particular Rosenbaum et al.'snotion of markets as communicative networks existing through the struc-tural knowledge of participants contributes to our understanding of pol-itics and economics as processes constituted by agents perceiving andresponding to structures and those structures being constituted by theactions and perceptions of agents (Amoore et al., 2000). Further, one couldoptimistically argue that this epistemologicalmove mirrorsactual change inthe perceptionsof those involved in running the global economy. ThirdGeneration notions that history is a non-determined process and insti-tutions a product of the human mind are not actually new - Vico wroteas much in the eighteenth century (Cox, 1981) - but it is a major step torecognize that this epistemology reflects a real challenge to orthodox pol-icy over the past decade. Where markets were thought to be spontaneousand inevitable, now it is recognized institutions must first be nurtured.Where states were believed to be the natural unit of power, now gov-ernance is understood to be diffuse (with democratic implications). Wherefirms were thought of simply as profit-maximizing units, now corpora-tions are thought to have an obligation to accommodate social and

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O'LOUGHLIN: CONCEPTIONS OF POLITICS AND ECONOMICSenvironmental responsibilities. Where NGOs existed only to representneglected groups and issues, now their support can often be neces-sary for policy approval and implementation. Reconsideration of posi-tive propositions, through this epistemological lens, revives normativepossibilities in IPE.A further cause for optimism regarding future change in institutionalform and policy is the changing nature of power entailed by these alteredconceptions of politics and economics. In communicative networks andcross-institutional interactions the outcome of processes is not determinedas much by traditional power resources - economic wealth, militarymight, natural resources - as by knowledge, expertise, and manipula-tion of Western public opinion. Of course Western states and firms havegreatest access to these resources of indirect power, but not a monopoly.Yet if politics has been transformed and economics reconsidered in thelast decade alone, if functions have been abdicated and not fully fulfilled,if the nature of power alters the capacities of actors old and new, thenthere is all to play for in the world of IPE.

Ben O'LoughlinNew College, Oxford

NOTES1 It should be noted that the three generationsare analytical categories usedto illustrateevolving conceptionsof politicsandeconomics n IPE.The actualevolution of the literature s more messy in both content and timing, e.g.some literaturecould be interpreted o fit into severalgenerations,or someFirst Generation iteraturewritten after Third (if the author is particularlymyopic or stubborn).2 Higgott (2000) argues a post-Washington Consensus agenda has emerged inwhich the term 'global governance' is merely part of a new discursive con-struction in which the global economy is a neutral space to be managedrather than inherently conflictual. A number of buzzwords are being assim-ilated into this discourse, e.g. civil society, transparency, social capital, andfinancial architecture.3 This is not to argue that any type of change - for example 'progress', 'devel-opment' or any teleology - are inevitable, rather change perse is inevitable.4 For the embeddedness of economic relations in social relations see alsoGallarotti (2000), and Granovetter (1985) for the original use of the concept.5 This could raise questions for political theorists and philosophers regardingthe nature of human nature and its implications for governance. Designinggovernance privileges notions of the improvable, rational human being, whileif we perceive humans as selfish animals competing in a Hobbesian state ofnature, conflict is inevitable.

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