210136 SE M4: Prospects and Challenges for a New International Economic Order (2025S)

Aims:
The aim of the course is to learn about different theoretical approaches to questions of international economic cooperation in the light of the current discussion on geopolitics and the crisis of the liberal world economic order , as well as to apply them to the analysis of problem areas of the current international economic policy discussion.

Contents:
International trade, like the free flow of capital, is one of the defining characteristics of economic globalization, which has become even more dynamic since the 1980s. The academic and economic policy debate has always been characterized by the contrast between free trade and protectionism. The global economic order went through several phases after the Second World War. Until the 1970s, a phase of “embedded liberalism” (John Ruggie) prevailed with the GATT agreement and the Bretton Woods organizations. The crisis of this order during the 1970s manifested itself not only in the end of the system of fixed exchange rates (1973), but also in discussions about the need for a New International Economic Order (NIEO) that had been promoted by the newly independent countries of the Global South. The Volcker Shock (1979/80) and the debt crisis of the so-called Third World in the 1980s ushered in the renaissance of a liberal world economic order, which culminated in the founding of the World Trade Organization (WTO) in 1994. With the WTO, the agenda of progressive trade liberalization reached a new quantitative and qualitative peak. Trade policy became a very broad field, encompassing a wealth of issues and areas, including the liberalization of services and investment, public procurement and cooperation on all relevant regulatory issues. With the stalling of the WTO Doha Agenda since 2005 and the global financial crisis of 2007/08, the liberal international order came increasingly into crisis. The domestic effects of trade liberalization (deindustrialization, unemployment, greater economic inequality) led to political erosion processes in the center states (USA, EU). Political support for (neo-)liberal economic policies declined. With the election of Donald Trump as US President in 2016, the international division of labor became the subject of national-populist politics, and unfair international trade conditions were declared the cause of domestic political problems. International organizations such as the WTO suffered a loss of importance as a result. Since then, the rivalry between the USA and China has increasingly dominated the international economic agenda. The resulting crisis of multilateralism raises the question of how international economic cooperation can be shaped in an increasingly multipolar and fragmented international system.

Methods:
Against the background of this strong qualitative change in the international economic order, the course provides a theoretical and historical overview of the development of the world economy after the Second World War. On the other hand, the course also aims to build on the discussions of the 1960s and 1970s about a New International Economic Order and draw inspiration from them for the current debate about the design of a future world economic order and the promotion of equal international economic relations in view of the deep crisis of the liberal world economic order.