Q.3 What do you understand by International Political Economy? How it promotes economic dependency in the developing states? 2020
International Political Economy (IPE) refers to the study of the interaction between politics and economics in international relations. It is a subfield of international relations that focuses on how states, markets, and institutions interact in the global economy.
One of the key features of the global economy is economic dependency, which refers to the degree to which one country depends on another for its economic well-being. Developing countries are often highly dependent on developed countries for investment, trade, and financial assistance, which can create a range of economic, political, and social challenges.
There are several ways in which the international political economy promotes economic dependency in developing countries. Firstly, the global economy is dominated by developed countries and multinational corporations, which often set the rules and standards of trade and investment. Developing countries often have limited bargaining power in these negotiations, which can lead to unfavorable terms of trade and investment.
Secondly, the global economy is characterized by unequal distribution of resources and wealth, which can create a vicious cycle of poverty and economic dependency. Developing countries often lack the resources and infrastructure to compete with developed countries, which can lead to a reliance on foreign aid and investment.
Finally, the international financial system can also contribute to economic dependency in developing countries. International financial institutions like the International Monetary Fund and the World Bank often provide loans and financial assistance to developing countries, but with conditions that can be difficult to meet. These conditions often require countries to implement economic policies that prioritize the interests of developed countries and multinational corporations, rather than the needs of their own citizens.
In conclusion, economic dependency is a major challenge facing many developing countries in the international political economy. The domination of developed countries and multinational corporations, unequal distribution of resources and wealth, and the influence of international financial institutions can all contribute to this dependency. Addressing these challenges requires a coordinated global effort to promote sustainable and equitable economic development.
