The top ten books to read about international economic history

Back in the spring, I hinted that I would be willing to produce a top ten list of must-read books on the international political economy/global political economy (IPE or GPE for those in  the know), provided there was sufficient demand. 

Judging by the e-mail response, the demand is robust and quite persistent.  So I've decided... to postpone that list for another month or two.

Because you're not ready yet. 

Let's face it, if you have read this far in the post, it means you're either: 

  • A curious professor ready to minimize this page if anyone walks in;
  • A grad student seeking the keys to success in the profession;
  • An intense undergraduate student who really wants to study IPE. 

This is great.  The thing is, most graduate programs in political economy don't give you that much historical background before throwing the cutting-edge theory and methodology at you.  This year I was lunching with some Ph.D. students at one of the top IPE schools in the country, and the students (and some of the professors) made it pretty clear that they didn't know all that much about the topic beyond the tricks of the trade - formal modeling, econometric techniques, etc. 

If you're expecting me to go off on a rant here about the uselessness of these tools, well, you're going to be sadly disappointed.  There are some pretty good reasons to learn these techniques - among other things, they'll help you to separate the wheat from the chaff when it comes to what blogs, pundits and public intellectuals are saying about the global economy. 

That said, the opportunity cost can be significant - a failure to learn anything about global economic history beyond the stylized facts contained in the most-cited articles.  This would be a weird collection of scattered knowledge, ranging from the 1860 Cobden-Chevalier Treaty to the 1934 Reciprocal Trade Agreements Act to the birth of the Washington Consensus

Soooo..... before you are ready to ready the ten books in IPE that you have to read, you should first read these ten books on global economic history.  I'm leaving a lot out here (North and Thomas' The Rise of the Western World; Karl Polanyi's The Great Transformation; anything and everything by William McNeill, Joel Mokyr, David Landes, Alfred D. Chandler, Jr., Joseph Needham; some things by Niall Ferguson, etc.).  That's partly because I've slanted this list towards more recent scholarship, and partly because while these books are excellent economic histories, they don't focus as much on the international dimension. 

[There are some other newly-released books, such as Liaquat Ahamed's Lords of Finance or Justin Fox's The Myth of the Rational Market, that might very well belong on this list.  I'm still in the middle of reading them, however, so the jury is still out.]

Once you imbibe the (sometimes contradictory) information contained in these books, you can look at what the stylized facts contained in IPE books with a much more astringent perspective.  It's not a coincidence that the foundational IPE texts are by the twentieth century's greatest economic historians - Eli Heckscher, Albert Hirschman, Charles Kindleberger, and Jacob Viner.  Trust me - you will feel much the wiser for it. 

The following would be my preferred order of how to read them, but it's hardly the only way to do it: 

1.  Gregory Clark, A Farewell to Alms:  A Brief Economic History of the World (2007). I've already tagged this book as an interesting read.  If nothing else, the first chapter of this book - "The Sixteen-Page Economic History of the World"  - actually matches the audacity of the title.  As I said, I don't completely buy Clark's explanation of Malthus + genetics = Industrial Revolution in Great Britain.  His attempt to explain away the irrelevance of institutions doesn't hold up to scrutiny.  Still, I will say I better appreciated the heyday of mercantilism after reading Clark. 

2.  Nathan Rosenberg and L.E. Birdzell, Jr., How the West Grew Rich (1986).  Perfect when paired with Clark, because Rosenberg and Birdzell present the classical argument for why Western Europe was the birthplace of the Industrial Revolution. 

3.  Jared Diamond, Guns, Germs, and Steel (1997).  The third leg in the triad of "why did Europe dominate the globe?" explanations.  If Clark focuses on genetics/culture, and Rosenberg and Birdzell focus on institutions, Diamond proffers a geographical determinism.  Simply put, he thinks the temperate climate of Eurasia was bound to produce the most sophisticated societies with the most advanced animals, germs, and technologies.  Diamond's argument complements rather substitutes for the institutions and culture arguments.  If nothing else, it is impossible to read this book and ever buy the ending to War of the Worlds.

4.  John Nye, War, Wine and Taxes (2007).  David Ricardo's classic example of comparative advantage was English wool for Portuguese wine.  Nye explodes the "natural" aspect of this trade, demonstrating how high tariffs against French wine proved a boon to both the Portuguese and English beer distillers.  Nye stretches his argument too far at times, but the interrelationship between war, protectionism, and statebuilding is pretty damn fascinating. 

5.  Douglas Irwin, Against the Tide:  An Intellectual History of Free Trade (1996).  Irwin's book is more a history of economic thought than economic history, but nevertheless tells a remarkable story:  how did the idea of free trade knock off mercantilism, protectionism, strategic trade theory, and other doctrines?  

6.  Kevin O'Rourke and Jeffrey Williamson, Globalization and History (1999).  A lucid, detailed and fascinating study of how the nineteenth century of globalization went down.  When anyone argues that the current (fast fading?) era of globalization is historically unique, take the hardcover version of this book and whack them on the head with it.  Special bonus book:  people who liked this should go on to read Power and Plenty by Kevin O'Rourke and Ron Findlay). 

7.  Jeffry Frieden, Global Capitalism:  Its Fall and Rise in the Twentieth Century (2006).  This book is to the twentieth centiury as Williamson and O'Rourke's book is to the nineteenth - except it's written for a wider audience, so it's a more accessible read.  Accessible doesn't mean simple, however - this book is chock full of interesting arguments, cases, and counterarguments.  

8.  Barry Eichengreen, Globalizing Capital:  A History of the International Monetary System, second edition (2008).  A more narrow work than Frieden's, Eichengreen's book is the starting point for understanding the classical gold standard, the Bretton Woods regime, and whatever the hell system we have now the Bretton Woods II regime. 

9.  Daniel Yergin and Joseph Stanislaw, The Commanding Heights (1997).  Yergin and Stanislaw tell a cheerleader's tale of how the Washington Consensus displaced the old quasi-Keynesian, quasi-socialist economic order that had its apogee and downfall in the 1970s.  What's particularly interesting is their argument that what mattered was the content and spread of the ideas themselves, and not some coercive power, that led to the re-embrace of markets.  

10. Paul Blustein, The Chastening (2001).  Blustein, a reporter for the Washington Post, tells the you-are-there version of the Asian financial crisis and the reaction from the U.S. Treasury Department.  If you want to know why Pacific Rim economies started hoarding foreign exchange reserves beginning in 1999, read this book. 

OK, readers, which books would you recommend? 

Daniel W. Drezner

Trying for the full Huntington

As I've said before, I've greatly admired Samuel Huntington's career. Huntington's gift as an academic is that he has been unafraid to make the politically incorrect argument, regardless of the consequences. This doesn't always mean he is right -- but it does mean he's usually interesting. I suspect that John Mearsheimer and Stephen Walt are trying to copy the Huntington template in their essay, "The Israel Lobby" for the London Review of Books: Here's how it starts:

For the past several decades, and especially since the Six-Day War in 1967, the centrepiece of U.S. Middle Eastern policy has been its relationship with Israel. The combination of unwavering support for Israel and the related effort to spread democracy throughout the region has inflamed Arab and Islamic opinion and jeopardised not only U.S. security but that of much of the rest of the world. This situation has no equal in American political history. Why has the U.S. been willing to set aside its own security and that of many of its allies in order to advance the interests of another state? One might assume that the bond between the two countries was based on shared strategic interests or compelling moral imperatives, but neither explanation can account for the remarkable level of material and diplomatic support that the U.S. provides.

Instead, the thrust of U.S. policy in the region derives almost entirely from domestic politics, and especially the activities of the Israel Lobby. Other special-interest groups have managed to skew foreign policy, but no lobby has managed to divert it as far from what the national interest would suggest, while simultaneously convincing Americans that U.S. interests and those of the other country  in this case, Israel are essentially identical.

Well, that argument certainly won't rub anyone the wrong way. Interested readers should be sure to check out the longer, footnoted paper which is archived at the Kennedy School of Government. So do Mearsheimer and Walt achieve the full Huntington? No, not really. "The Israel Lobby" is the academic equivalent of waving a big red cape at one's ideological opponents, hoping they'll foam at the mouth and act stark raving mad because the authors cited Chomsky or CommonDreams, or because, "the Fatah office in Washington distributed the article to an extensive mailing list." [Or maybe they're pissed that they didn't crack the 100 Most Dangerous Professors in America!!--ed.] So let's avoid that bait. Reading the essay, I can conclude the following:

1) Mearsheimer and Walt make a decent case of arguing that interest group lobbying is responsible for some aspects of U.S. policy towards the Greater Middle East. Now this asssertion alone is enough to make people very uncomfortable at cocktail parties and other venues. Whenever I bring up ethnic lobbying in my American foreign policy class and mention Israel, everyone in the room tenses up. So kudos to Mearsheimer and Walt for speaking the taboo thought.

2) Shot through these papers are an awful lot of casual assertions that don't hold up to close scrutiny [Which makes it eerily similar to some of your blog posts!!--ed. True that.]. The authors assert that, "If Washington could live with a nuclear Soviet Union, a nuclear China or even a nuclear North Korea, it can live with a nuclear Iran. And that is why the Lobby must keep up constant pressure on politicians to confront Tehran." I'm pretty sure that there's more to U.S. opposition to Iran possessing nuclear weapons than the protection of Israel.

From the longer Kennedy paper, Mearsheimer and Walt make a fascinating logical assertion: "[T]he mere existence of the Lobby suggests that unconditional support for Israel is not in the American national interest. If it was, one would not need an organized special interest group to bring it about. But because Israel is a strategic and moral liability, it takes relentless political pressure to keep U.S. support intact." What's fascinating about this quote are the implicit assumptions contained within it: i) the only interest group in existence is the Lobby, and; ii) in the absence of the Lobby, a well-defined sense of national interest will always guide American foreign policy. It would be very problematic for good realists like Mearsheimer and Walt to allow for other interest groups -- oil companies, for example -- to exist. This would allow for a much greater role for domestic politics than realists ever care to admit.

Finally, they argue that the U.S. invaded Iraq only primarily because Israel and the Lobby -- in the form of neoconservatives -- wanted it. I wrote my take on this argument three years ago:

The notion that such a conspiracy exists rests on the belief that the administration's foreign policy principals -- Donald Rumsfeld, Condoleezza Rice, Colin Powell, Dick Cheney, and Bush himself -- have somehow been duped by the neoconservatives into acting in a manner contrary to their beliefs. But while critics have never lacked for accusations against these officials, being weak-willed is not among them. In the end, it's far more likely that Bush is exploiting the neoconservatives' ideological arsenal to advance his preferred set of policies than vice versa.

3) There are sins of omission as well as commission. Walt and Mearsheimer assert that Israel has been a "strategic burden." They do a good job of cataloging why that's the case -- but omit important examples of Israel being useful, such as the 1981 Osirik bombing. They also go into depth on the Bush administration's policy towards the Palestinian Authority, but never mention the arms shipment that Arafat lied to Bush about as a causal factor behind Bush's decision to freeze out Arafat.

4) The evidence is pretty thin in some sections. To demonstrate the current political power of the American Israel Public Affairs Committee, they cite a 1984 election where AIPAC was allegedly curcial. They argue that the Israeli-Palestine problem is at the root of Al Qaeda's beef with the United States -- which is funny, because I was pretty sure it was the presence of U.S. forces near the holy shrines of Mecca and Medina. They claim the Lobby is responsible for U.S. policy towards Syria, but that policy amounts to little more than some empty sabre-rattling.

After finishing the article, I began to wonder whether the paper is simple a massive exercise in explaining away a data point that realism can't cover. Most realists opposed the Iraq War, and Mearsheimer and Walt were no exception. They can and should take some normative satisfaction in being proven right by what happened after the invasion. However, I suspect as positive social scientists they are bothered by the fact that the U.S. invaded Iraq anyway when realism would have predicted otherwise. When realists are confronted with contradictory data, they tend to fall back on auxiliary hypotheses -- the cult of the offensive, the myth of empire -- that have very little to do with realism. Explaining away Iraq on The Lobby might have a whiff of the Paranoid Style, but it's certainly consistent with the literature.

In the end, I think Mearsheimer and Walt get to the full Huntington -- but alas, it's the Huntington of Who We Are? rather than The Soldier and the State. There's more I could write about, but I'm eager to hear what others think.

UPDATE: OK, I should have said, "I'm eager to hear what others think... after they read the article." Two final thoughts. First, I'm surprised and disappointed that the article has gotten zero coverage from the mainstream media in the United States. I completely agree with Walt and Mearsheimer that this is a topic that needs more open debate. Second, there's one non-event that keeps gnawing at me after reading the piece. If "The Lobby" is as powerful as Walt and Mearsheimer claim, why hasn't there been a bigger push in the United States for more fuel-efficient cars, alternative energy sources, and the like? After all, the only strategic resource that Israel's enemies possess is large quantities of oil. If "The Lobby" is so powerful and goal-directed, wouldn't they have an incentive to reduce the strategic value of their advesaries?

ANOTHER UPDATE: See this follow-up post on the Walt/Mearsheimer paper as well.