Lecture 8 Flashcards
What were the key ideas of post-WWII Keynesianism?
-The state must/ play a central role
-Modernization and ‘take off’ of underdeveloped countries through government investment
- trade and ISI
What was the prevailing viewpoint in the post-war period until the 70s and 80s?
Post-war Keynesianism
What was the start of the rise of “neoliberal” “hyper” globalization?
70s and 80s
What were the key economic ideas during the rise of “neoliberal” “hyper” globalization?
Deregulation
Privatization
Trade Liberalization
Market-oriented Reforms
What is modernization theory? (Rostow)
A development theory that suggests societies will develop as they adopt more modern practices.
Why was the third world underdeveloped according to the modernization theory?
Primitive technologies and wrong values
The golden age came to an end in the 1980s, what happened?
oil price shocks,
slow growth+high inflation
ISI meets challenges,
people took on too much debt
What is the globalization of production?
the shift in the organization of industries and the production processes on a global scale.
It involves the movement of production activities, such as manufacturing and assembly, to different countries around the world, taking advantage of lower costs, resources, and labor markets.
What was the consequence of neoliberal policies?
Aim: increase economic efficiency and promote economic growth
Reality: increased income inequality, reduced social safety nets, and financial instability.
What is the financialization of everything in the 1980s and 1990s?
The shift in the global economy where financial markets and activities played a dominant role in shaping economic outcomes.
Financialization involved the growing influence of financial institutions, the use of complex financial instruments, and the emphasis on making profits from financial activities rather than productive investments.
What are historical drivers of financialization?
pursuit of higher profits
the transition to shareholder capitalism,
What is the neoclassical perspective on financialization?
This perspective tends to downplay the negative consequences of financialization, such as inequality and financial instability
What is the critical political economy perspective on financialization?
This perspective raises concerns about inequality and the subordination of social life to markets.
What is the state-centered political economy perspective on financialization?
This perspective recognizes the complexities and power dynamics involved in the relationship between states and financial institutions.
What is embedded liberalism?
liberal economic principles with a commitment to social welfare and domestic political stability
The core principle of embedded liberalism is the recognition that free markets need to be intergrated within a broader system of social and political institutions.
