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Article

Riham Bahi

The spread of COVID-19 is not just a health crisis. The pandemic has taken a geopolitical dimension. The health crisis amplified the competitive dynamics between the USA…

Abstract

Purpose

The spread of COVID-19 is not just a health crisis. The pandemic has taken a geopolitical dimension. The health crisis amplified the competitive dynamics between the USA and China, affected the provision of global public goods and injected instability into the global order. In line with the geopolitical zero-sum thinking, both the USA and China have sought to capitalize on the crisis to boost their international profile. Instead of working together to mitigate the health and economic impacts of COVID-19, the two powers fear that the other will exploit the current situation to accrue political, economic or military gains that will give it an edge after the pandemic subsides. The spread of COVID-19 has set off a “battle of narratives,” in which China and the USA are accusing each other of failing to rise to the challenge. The world seems to be falling into a “Kindleberger Trap,” in which the established power is unable to lead while the rising power is unwilling to assume responsibility. The COVID-19 crisis is occurring amid the collapse of global cooperation. The USA, the traditional leader of international collective efforts in times of crisis, has abandoned its role entirely. The lack of leadership at the global level during an international crisis may cause the breakdown of the international order.

Design/methodology/approach

This paper examines the US-China competitive dynamics through the lens of the work of Charles Kindleberger, which both liberals and realists regard as foundational when examining the dynamics of global crisis management. This paper also uses the meta-geopolitics framework to determine the ability of both China and the USA to respond to the current COVID-19 crisis and its implications for their power and standing in the international system.

Findings

This paper concludes that the only way to escape the Kindleberger trap is “to embed Sino-American relations in multilateralism.”

Originality/value

As rivals, both the USA and China are seeking to capitalize on the crisis to boost their international profile. This paper probes how China and the USA navigated the ongoing COVID-19 crisis to determine whether or not they are currently in a “Kindleberger Trap,” using elements of the meta-geopolitics framework of analysis, namely, health issues, domestic politics, economics, science and international diplomacy. Using the meta-geopolitics framework will help us determine the ability of both China and the USA to respond to the current COVID-19 crisis and the implications of that on their power and standing in the international system.

Details

Review of Economics and Political Science, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 2356-9980

Keywords

Content available
Article

Nussaiba Ashraf

This study aims to investigate the decline of American hegemony as one of the most prominent crises of the modern world order, from a broader perspective that transcends…

Abstract

Purpose

This study aims to investigate the decline of American hegemony as one of the most prominent crises of the modern world order, from a broader perspective that transcends narrow traditional interpretations. The paper assumes that the September 11 events in 2001 have launched the actual decline in American hegemony. Tracing the evolution of US global strategy over the past two decades, the study seeks to analyze the main causes and repercussions of the decline of US hegemony, which would provide a bird’s eye view of what the current global system is going through.

Design/methodology/approach

The study investigates the decline in American hegemony through a longitudinal within-case analysis which focuses on the causal path of decline in hegemony in the case of the USA, since the events of September 11, 2001, and tries to identify the causal mechanisms behind this decline. Following George and Bennet (2005), the study uses process tracing to examine its research question. Process-tracing method seeks to identify the intervening causal process – causal chain or causal mechanisms or the steps in a causal process – that leads to the outcome of a particular case in a specific historical context (Mahoney, 2000; Bennet and Elman, 2006). The study chose this method, as it offers more potential for identifying causal mechanisms and theory testing (George and Bennet, 2005); it opted for a specific procedure, among the variety of process-tracing procedures listed by George and Bennet, which is the detailed narrative presented as a chronicle, accompanied by explicit causal hypotheses. Using this process tracing procedure, the study assumes that American hegemony has witnessed dramatic changes in the aftermath of critical junctures, particularly the events of September 11, 2001, and the financial crises, 2008, which contributed significantly to this decline. Consequently, it traces the impact of these events on the state of American hegemony, in light of the review of contributions of different theories on hegemony in the field of international relations, both traditional and critical. Consequently, introducing the theoretical framework used in the study (the four-dimensional model of hegemony), which transcends criticisms of previous theories.

Findings

The crises of the modern world order and the decline of American hegemony – being the main manifestation of such crises – revealed the inability of the traditional and critical approaches reviewed in the study to interpret this decline and those crises. The reason behind that was the inability of these interpretations to reflect the various dimensions of American hegemony and its decline since the September 11 events. This highlights the importance of using the four-dimensional model, which combines different factors in the analysis and has proved to be an appropriate model for studying the case of American hegemony and its decline after the events of September 11, as it deals with the phenomenon of hegemony as a social relationship based on specific social networks.

Originality/value

Despite the currency and relevance of the decline of US hegemony for both the academic and political world, the topic needed to be analyzed systemically and addressed in a thorough scientific way. Through the application of theoretical concepts into the analysis of empirical data, this study contributes to a field where too often the discourse about decline of American hegemony is led without the required theoretical or conceptual considerations.

Details

Review of Economics and Political Science, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 2356-9980

Keywords

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Article

Stéphane Le Queux and David Peetz

The purpose of this paper is to examine the nature of union responses to globalisation and, in particular, the global financial crisis; the consequences of the financial…

Abstract

Purpose

The purpose of this paper is to examine the nature of union responses to globalisation and, in particular, the global financial crisis; the consequences of the financial crisis for workers; and lessons from the experience.

Design/methodology/approach

The authors examined numerous union statements, declarations, reports and actions as well as extensive documentary evidence from other sources. The focus was on the behaviour of supranational trade unions, including the European Trade Union Confederation, the International Trade Union Confederation and Global Unions.

Findings

The supranational unions’ methods gradually shifted in the 2000s from reliance on institutional politics to collaboration with broader alter‐globalisation protest movements, though this carried risks. The global financial crisis appeared to be a strategic opportunity for trade unions, but while they developed sophisticated policy packages, they were unable to change the behaviour of global institutions. This accentuated the shift in union strategy. Governments initially set aside free market ideology for stimulus packages, but failed to regulate to prevent future crises. Workers bore the brunt of the crisis. The experience highlighted the contradictions facing unions dealing with global issues.

Practical implications

The outcomes of crises depend on the actions, strategies and prior strengths of the parties. Different outcomes emerged from prior crises and may emerge from future ones.

Originality/value

Few studies have examined the role of supranational unions in the context of the financial crisis. A clearer understanding of the weaknesses of and impediments to supranational union responses may increase the likelihood that future crises will be better understood and be followed by more effective responses.

Details

International Journal of Manpower, vol. 34 no. 3
Type: Research Article
ISSN: 0143-7720

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Article

Norman Mugarura

The purpose of the paper is to examine the law and how it has been utilised in fostering proper functioning of global markets within member countries and globally. The…

Abstract

Purpose

The purpose of the paper is to examine the law and how it has been utilised in fostering proper functioning of global markets within member countries and globally. The term “law” in this context refers to international law, whose primary function is to regulate activities of sovereign States and organisations created by a group of States. The Statute of the International Court of Justice 1907, which has been ratified as a treaty by all UN nations, provides the most authoritative definition of the sources of international law to date (Schachter, 1991). Under Article 38 of Statute of the International Court of Justice 1907, there four main sources of international law such as treaties, international customs, general principles of law recognised by civilised nations and judicial decisions of International Court of Justice and other internationally accepted tribunals. They are the materials and processes out of which the rules and principles regulating the international community are developed and sustained. The term “global Village” was coined by a Canadian scholar by the name of Marshall McLuhan to describe the contraction of the globe into a village because of advances in internet communication technology and increased consciousness and enhanced transport systems (McLuhan, 2003). The current “global village” is manifested by the growing interconnectedness of economies which has enhanced the ability of states to interact economically, politically and socially. It operates in a way that seems to defy common definitions such as delimitations of national borders and states. The global system has created shared synergies such as free movement of workers, capital, good and services. However, it has created varied challenges for individual states given that challenges in one part of the globe can easily navigate into the system to infest other countries including those that have nothing to do with its causes. This dichotomy is highlighted by the debt crisis in the Eurozone member countries which has been simmering since 2009 but has recently bubbled to the surface by the crisis in Greece. The challenges in Greece as well in other deeply integrated countries have not been confined within individual countries or regions but have had a domino effect farther afield due to the growing interconnectedness of economies. There are dualities in the global system manifested by the fact that developed countries are endowed with the means, and, therefore, they have requisite capacity to harness the law and markets easily as opposed to their counterparts in least developed countries (LDCs), where this leverage is non-existent. Less-developed economies are so described because they lack requisite capacity and cannot compete as efficiently as their counterpart in developed countries. This has translated into ambivalence and half-heartedness in some states attitude to embrace market discipline wholeheartedly. The foregoing challenges have been exacerbated by the tenuous legal systems, lack of robust infrastructure, oversight institutions and corruption, especially in the LDCs cohort. The paper utilises empirical data to evaluate the role of law in fostering the relationship between states and markets. In other words, are the rules governing global markets effectively working to ensure a harmonious co-existence of markets, states and various stakeholders? Can the recent global crises such as the debt crisis in Greece mean that the global village is in quandary? Is there any village that is devoid of challenges or they are part and parcel of life? The paper utilises empirical examples in both developed and developing countries to evaluate the current state of the contemporary global village in search for answers to the foregoing nagging questions.

Design/methodology/approach

The paper adopts a selective review approach in analysing the most appropriate materials for inclusion in its analysis. It is an empirical study based on the most recent global developments such as the global financial crisis, the debt crisis in European Union (EU) to gains insights into the interplay of the relationship between law and markets and the occasional disharmony between these two regulatory domains.

Findings

The issues examined in this paper provide significant insights into the dynamics of the global village, law and markets. It has delineated that for markets to work effectively, the state needs to remain in the loop and to keep an arm’s length relationship with the market because it will have to come in to pick the pieces when things go wrong. The law cannot be pushed to the sidelines because it will have to provide the instruments for states and markets to operate efficiently within their respective regulatory domain. There is no state, including North Korea (not as open as other economies in Asia), which can close its door entirely to markets. Experience has demonstrated that law is more than rules which govern societies but a way of life such that a society is as developed as is its legal system. The State needs to use the leverage of the law and to take centre stage for markets to remain viable and relevant. Recent crises such as the debt crisis in Greece or the global financial crisis before provide lessons for proponents of the global market system to learn so that it can proportionately distribute benefits and not challenges.

Research limitations/implications

The global market system has imposed varied challenges on states at the scale never envisaged before. Some of the theoretical premises relating to the paper were based on secondary data sources and were evaluated based on a small sample of cases. The author, therefore, extrapolated that the law seems to have been relegated to the sidelines to not interfere with markets. The paper has evaluated the current global market system in the context of contemporary challenges in Europe and in other regions; it would have been better to explore examples from other regions. It is evident that the state and the market are two sides of the same coin – they are embedded in each other, and their relationship complimentary and will have to co-exist. They need to work in tandem because the market needs the state and the state needs the market. Meanwhile, both the state and the market need the law as an equalizer to ensure they are regulated according to engendered rules. It appears that the disharmony between the state and the market is because of the fusion of law and politics which often results in overlapping interests. The recent global financial crisis and the frantic efforts of EU government to bail out debt distressed countries like Greece have implied that governments will need to maintain an arms-length relationship with markets. When the state lets its hands off, literally speaking, in the author’s view, markets will veer off course.

Practical implications

The global system has created shared synergies such as free movement of workers, capital, good and services. However, it has created varied challenges for individual states given that challenges in one part of the globe can easily navigate into the system to infest other countries including those that have nothing to do with its causes. States and stakeholders will need to carefully evaluate the impact of global regulatory initiatives to make sure that in adopting them, they are not debased or undermined by those initiatives.

Social implications

For markets to work properly, the state must remain in the loop and keep an arms-length relationship with the market because it will have to come in to pick the pieces when things go wrong. The law cannot be pushed to the sidelines because it will have to provide the instruments for states and markets to operate efficiently within their respective regulatory domain. There is no state, including North Korea (not as open as other economies in Asia), which can close its door entirely to markets. Experience has demonstrated that law is more than rules which govern societies but a way of life such that a society is as developed as is its legal system. The State needs to use the leverage of the law in providing effective regulatory oversight of markets both domestically and globally.

Originality/value

The paper was written on the basis of recent global crises such as the debt crisis in Greece, Europe, which were evaluated in the narrow context and are objectives of the paper.

Details

International Journal of Law and Management, vol. 58 no. 6
Type: Research Article
ISSN: 1754-243X

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Book part

J. S. Osland, M. E. Mendenhall, B. S. Reiche, B. Szkudlarek, R. Bolden, P. Courtice, V. Vaiman, M. Vaiman, D. Lyndgaard, K. Nielsen, S. Terrell, S. Taylor, Y. Lee, G. Stahl, N. Boyacigiller, T. Huesing, C. Miska, M. Zilinskaite, L. Ruiz, H. Shi, A. Bird, T. Soutphommasane, A. Girola, N. Pless, T. Maak, T. Neeley, O. Levy, N. Adler and M. Maznevski

As the world struggled to come to grips with the Covid-19 pandemic, over twenty scholars, practitioners, and global leaders wrote brief essays for this curated chapter on…

Abstract

As the world struggled to come to grips with the Covid-19 pandemic, over twenty scholars, practitioners, and global leaders wrote brief essays for this curated chapter on the role of global leadership in this extreme example of a global crisis. Their thoughts span helpful theoretical breakthroughs to essential, pragmatic adaptations by companies.

Details

Advances in Global Leadership
Type: Book
ISBN: 978-1-83909-592-4

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Book part

Bang Nam Jeon and Ji Wu

This chapter examines how foreign banks respond to domestic monetary policy in host countries during crisis periods, in particular, the response shown toward the Asian…

Abstract

This chapter examines how foreign banks respond to domestic monetary policy in host countries during crisis periods, in particular, the response shown toward the Asian financial crisis of 1997–1999 and the global financial crisis of 2008–2009. By observing 283 domestic and foreign banks in seven emerging Asian economies, we find that foreign banks are slower than domestic banks in adjusting the growth of their loans to changes in host monetary policy. This inertia by foreign banks is found to be more pronounced in the recent 2008–2009 global crisis than in the 1997–1999 Asian regional crisis, suggesting that the buffering/hampering effects of foreign banks on the effectiveness of the domestic monetary policy transmission mechanism become stronger in a recent global crisis originating from outside Asia than a regional crisis imploded within Asia a decade earlier. We also find that foreign banks’ lower sensitivity than domestic banks to host monetary policy during the crisis periods is heterogeneous, depending on factors such as the extent of the adverse impact of crises on parent banks, the scope of business operation by parent banks, and foreign banks’ mode of entry into host banking markets.

Details

Global Banking, Financial Markets and Crises
Type: Book
ISBN: 978-1-78350-170-0

Keywords

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Book part

Anastasia Nesvetailova

The article provides a comparative critique of the financial underpinnings of the Great Depression of the 1930s and the recent wave of financial crises. The collapse of…

Abstract

The article provides a comparative critique of the financial underpinnings of the Great Depression of the 1930s and the recent wave of financial crises. The collapse of the financial systems in many developing nations, the bankruptcies in the Anglo-Saxon corporate sectors and a threat of more sovereign defaults on behalf of emerging markets suggest that the current wave of global financial fragility and recession rivals that of the Great Depression of the 1930s. The paper examines key elements that account for the crisis-prone nature of global capitalism: the political discipline of neo-liberalism, debt-driven expansion of the privatised financial markets, and the profound disarticulation of the financial and real economies. These factors suggests that the risk of a global depression is by no means hypothetical, and unless effective and collaborative efforts are made to tame the inherently unstable regime of global finance, even major world economies are faced with a prolonged period of financial turbulence and economic stagnation. The paper concludes by pondering the possibility of a paradigmatic shift in the transnational political consensus that can prevent a global repetition of the 1930s. While the increased awareness of financial instability and crisis may indeed prompt some ad hoc adjustments in national and foreign economic policies of major capitalist powers, in the long run these measures will be insufficient to prevent a major financial and economic disaster.

Details

Neoliberalism in Crisis, Accumulation, and Rosa Luxemburg's Legacy
Type: Book
ISBN: 978-0-76231-098-2

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Abstract

Details

The Exorbitant Burden
Type: Book
ISBN: 978-1-78560-641-0

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Article

Nargiza Alymkulova and Junus Ganiev

The global financial crisis hit the economy of the Kyrgyz Republic by the third wave of its transmission in early 2009. The purpose of this study is to examine the impact…

Abstract

Purpose

The global financial crisis hit the economy of the Kyrgyz Republic by the third wave of its transmission in early 2009. The purpose of this study is to examine the impact of the global financial economic crisis on the transition economy of the Kyrgyz Republic. As there is a low level of the Kyrgyz Republic’s integration into the global financial and economic processes, it is obvious that channels of transmissions are different.

Design/methodology/approach

The empirical model is the vector autoregression approach. The quarterly data from 2005 to 2013 of the remittances from abroad, trade volumes, exchange rates, credits, deposits and liquidity of the banking system, gross domestic product (GDP) and foreign direct investment (FDI) were used in the empirical analysis.

Findings

The authors found a significant positive relation between transmission channels such as remittances flow, banking sector, international trade and GDP within the first six months. Thus, a decline in the aforementioned variables has a significant affirmative effect on the country’s GDP. Notwithstanding, the exchange-rate channel adversely influences GDP. Thereby, the depreciation of the national currency leads to an increase in GDP.

Originality/value

The study findings allow the Kyrgyz policymakers to foresee the global crisis transmission through the primary channels of transmission mechanism. Nevertheless, a decrease of the deposit level by 1 per cent leads to 2.91 per cent decline in FDI inflows. On the contrary, an increase of the exchange rate by 1 per cent leads to 1.54 per cent decrease in imports.

Abstract

Details

The Impacts of Monetary Policy in the 21st Century: Perspectives from Emerging Economies
Type: Book
ISBN: 978-1-78973-319-8

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