Cooperation Under Anarchy

Question 1

Realist Assumptions

Answer 1

1. Anarchy
2. Unitary actors
3. Self-interest
4. Relative gains

Problems for Cooperation
-Power
-Collective action problem

Question 2

Collective Action Problem

Answer 2

-Non-excludable
-Non-rivalrous

-Large groups often fail to organize if the benefits are non-excludable

Question 3

Hegemonic Stability Problem

Answer 3

-Hegemon serves as a proxy for the state authority to reduce “anarchy”
-Can use punishment and reward to open foreign markets and avoid free riding

Two variants of HST
-Willing hegemon needed to support the international monetary system
-Hegemony brings economic openness

Question 4

Role of the Hegemon in Monetary Policy

Answer 4

Stability via management
1. Adjustment
2. Liquidity
3. Lender of last resort

But hegemony is difficult to maintain in monetary policy

Question 5

Role of the Hegemon in Trade

Answer 5

1. Offers access to its large market
   2, Secures the sea lines of communication
2. Creates international regimes for trade

Question 6

Why Would Hegemon Want to Increase Trade

Answer 6

1. National income increases with trade
2. Social stability decreases with trade
3. Political power increases with trade (for large developed countries)
4. Economic growth is difficult to predict but depends on technology

Question 7

Krasner

Answer 7

DV: Economic openness –> trade flows and trade barriers

IV: Distribution of economic power –> GDP, per capita income, size of armed forces

-Institutional trends are sticky

Question 8

Problems with HST

Answer 8

-Neglecting domestic politics
-Neglecting the role of alliances

Since smaller states benefit more from free-riding eventually hegemon’s power declines

Question 9

What Regimes Do

Answer 9

-Define obligations –> convergence of expectations
-Provide information –> monitoring and compliance
-Reduce transaction costs –> more likely to cooperate again
-Ensure “repeated play” –> increase importance of reputation
-Enforcement through denial of rewards, and sometimes punishments

Question 10

Keohane’s Answer to HST

Answer 10

Supply-side: hegemons create regimes
-Demand-side: states maintain regimes
-Motivation: what regimes do

Maintenance costs < benefits from cooperation
Maintenance costs < establishment costs
Regimes can persist after hegemony

Question 11

Example of Eichengreen’s HST (Readings)

Answer 11

Gold Standard –> British Hegemony
Interwar Gold-Exchange –> Collapse of Gold Standard, no real hegemon
Bretton Woods System –> US Hegemony

Question 12

Problems with Hegemonic Stability Theory (Readings)

Answer 12

1. Ambiguity of key concepts of the theory
   -HEGEMONY
   -POWER that the hegemon is assumed to have
   -REGIME whose stability is enhanced
2. Ambiguity about the instruments with which the hegemon makes its influence felt
3. Ambiguity about the scope of the HST

Question 13

Hegemonic Cooperation (Readings)

Answer 13

-A more applicable theory for international monetary relations
-“Cooperation is required for systemic stability even in periods of hegemonic dominance, although the presence of a hegemon may encourage cooperative behaviour”