Political Science 360

Spring 1999

SENIOR SEMINAR: CHANGE AND CRISIS IN THE NEW GLOBAL ECONOMY

Professor: Roy Grow

Office: Willis 406

Phone: x4086 (Office)

Email: rgrow@carleton.edu

Office Hours

The world economy has changed dramatically in the past decade: global economic power has shifted toward East Asia, the multinational corporation has become less attached to its national roots, and comparative advantages in production are determined less by control of material and physical labor than by access to knowledge and capital. Taken together, these trends are part of a phenomenon some analysts have termed "economic internationalization"--the increasing interpenetration of national economies with international society.

In the past, students of political economy tended to focus on two broad theories--"modernization" and "convergence" theory--to explain many of the changes occurring in the world economy. Modernization theory--related to the old Spencerian evolutionism--is loosely based on the sense that the world is moving in a progressive fashion, and that the future came first to Europe and the United States. Convergence theory, while related to modernization theory, takes the argument one step further and posits an eventual homogenization of different nations' economic behavior, even when that behavior springs from very different cultural foundations.

The world seems much more complex in 1999. On the one hand the rapid movement of technology and capital is transforming national economies across the globe. The relationship between North America and East Asia has changed dramatically during the past ten years as their economies have become more interdependent and the flow of goods and services has changed direction. East Europe and South America have begun to join this rapid movement, changing as well some important political and economic patterns.

On the other hand, these rapid changes have not proceeded as earlier theorists had predicted. The role of nations seems to have changed and economic growth no longer appears to be connected with general national prosperity. We are discovering some parts of a national economy can grow stronger while other parts, at the same time, degenerate and decay. Access to capital and knowledge now seems much less connected to national identity than it is to participation in a particular economic sector. Some even argue that governments and national boundaries have become much less important in determining economic wealth than in the past.

The debate has been brought into focus by the "economic crises" that began to move across the world in 1997--first in Southeast and East Asia, then in Russia and South America. Analysts debate the forces at work, argue about the causes, and look for indicators of change and renewal.

This is a "problem oriented" seminar that uses these crises as its starting point. The class will look into large theoretical questions by focusing on a specific set of problems: (a) what trends can we see in these world economic crises; (b) what elements of change and optimism are now visible; and (c) what models best help us understand (a) and (b).

Our seminar group will work as a team to find some answers to these questions. Spefically, we will constitute ourselves as a "professional consulting group" and take on a problem posed by a real-world corporate client. We will meet with this client, try to understand the problems, and devise some solutions. In developing these solutions, we will attempt to merge the theoretical with the "real world", figure out how to develop and evaluate the data we find, and use our insights to come up with perspectives that have real value for our client.

Requirements:

Completion of a group paper/report in which each member of the class is responsible for a specific part, participation in class discussions and assignments, and travel with the group on two short field trips to meet with our client and present our findings and recommendations.

Grading:

All parts of the project and other assignments are due on Wednesday June 2.

Texts:

The following are required for this course:

Callum Henderson, Asia Falling (McGraw-Hill)

World Bank, Global Economic Prospects (World Bank Books)

McLeod and Garnaut, East Asia in Crisis (Routledge)


WEEK 1: OVERVIEW: THE GENERAL PROBLEM

 Mon Mar 29 INTRODUCTION

 Wed Mar 31 ORIGINS OF THE CRISES

 Henderson, Asia Falling, Ch. 1, 2, 3

 Fri Apr 2 THE FIRST QUAKES

 Henderson, Asia Falling, Ch. 4, 5

WEEK 2: OVERVIEW (Cont.)

Mon Apr 5 MELTDOWN

Henderson, Asia Falling, Ch. 6, 7

Wed Aprl 7 JAPAN AT THE EPICENTER

Henderson, Asia Falling, Ch. 8, 9, 10

Fri Apr 9 THE NEXT STEPS

Henderson, Asia Falling, Ch. 11

WEEK 3: THE PROJECT: THINKING THROUGH THE ISSUES

Mon Apr 12 OUR CLIENT

Wed Apr 14 WORKING WITH A CORPORATE CLIENT

Fri Apr 16 PREPARING TO MEET OUR CLIENT

WEEK 4: THE CORPORATE CLIENT: ISSUES AND PROBLEMS

Mon Apr 19 FIELD TRIP

Wed Apr 21 WHAT DID WE LEARN?

Fri Apr 23 FORMULATING OUR PROJECT

WEEK 5. DEVELOPING THE DATA: TEAM PROGRESS REPORTS

Mon Apr 26 THE TROUBLED ECONOMIES (1): INDONESIA, THAILAND

McLeod and Garnaut, East Asia in Crisis, Ch. 2, 3

Wed Apr 28 THE TROUBLED ECONOMIES (2): KOREA, MALAYSIA

McLeod and Garnaut, East Asia in Crisis, Ch. 4, 5

Fri Apr 30 THE CHINA WORLD: PRC, HONG KONG, TAIWAN

McLeod and Garnaut, East Asia in Crisis, Ch. 6, 10, 11

WEEK 6 . DEVELOPING THE DATA: TEAM PROGRESS REPORTS (2)

Mon May 3 Mid Term Break

Wed May 5 THE EPICENTER: JAPAN

McLeod and Garnaut, East Asia in Crisis, Ch. 12

Fri May 7 THE BRIGHTER LIGHTS: SINGAPORE, PHILIPPINES

McLeod and Garnaut, East Asia in Crisis, Ch. 9, 10

WEEK 7. EVALUATING THE FUTURE: ANSWERS AND PERSPECTIVES

Mon May 10 PROSPECTS FOR DEVELOPING COUNTRIES

World Bank, Global Economic Prospects, Ch. 1

McLeod and Garnaut, East Asia in Crisis, Ch. 14, 19

Wed May 12 POLICY RESPONSES TO THE CRISES

World Bank, Global Economic Prospects, Ch. 2

McLeod and Garnaut, East Asia in Crisis, Ch. 15, 16, 17

Fri May 14 PREVENTING FUTURE MELTDOWNS

World Bank, Global Economic Prospects, Ch. 3

McLeod and Garnaut, East Asia in Crisis, Ch. 18

WEEK 8. DEVELOPING RECOMMENDATIONS / BUILDING OUR REPORT

Mon May 17

Wed May 19

Fri May 21

WEEK 9. PRESENTATION TO OUR CLIENT / REWORKING THE REPORT 

Mon May 24 FIELD TRIP

Wed May 26

Fri May 28

WEEK 10. COMPLETING THE FINAL DRAFT

Mon May 31

Wed Jun 2