Monetary orders, financial dependence, and idea selection: the international constraints on American Monetary Policy, 1961–1963

Abstract

Social scientists have increasingly turned to constructivist models to explain when, and how, international and world-level social forces constrain the policy-making autonomy of national states. While constructivists have shown that international ideational processes matter for domestic policy making, they have had a harder time explaining why some ideas gain prominence in policy discussions while others do not. This chapter develops an institutionally centered materialist model of idea selection, arguing that international relations of dependency give actors who control vital financial resources a greater capacity to shape the ideational agenda. This model is explored through a case study of the international sources of American monetary policy in the early 1960s. A detailed examination of archival materials shows that European officials at the Organization for Economic Cooperation and Development were able to advance their own ideas for American monetary policy because the United States was dependent on European cooperation to help resolve its mounting balance of payments problems.

Citation

Major, A. (2010), "Monetary orders, financial dependence, and idea selection: the international constraints on American Monetary Policy, 1961–1963", Go, J. (Ed.) Political Power and Social Theory (Political Power and Social Theory, Vol. 21), Emerald Group Publishing Limited, Leeds, pp. 49-92. https://doi.org/10.1108/S0198-8719(2010)0000021007