SUMMARY OF ANDERSON AND KUKUCHA CHAPTER 9 : THE WORLD BANK

AND INTERNATIONAL DEVELOPMENT

There are several perspectives of poverty. First, povery is a marginal problem derivated
from growth. It suggests that by intensifying the growth, poverty can be alleviated. Because,
the proponents think that improved growth will be reduce poverty–this applies the trickled-
down approach–and reducing poverty will only worsen the growth. This perspective, thorugh
1990-91 WDR, proposes labour utilization and social subvention for the poor–education,
healthcare, etc. In order to do so, a less goverment’s intervention is required. This perspective
is supported by the Canadian government.

However, the former definition–which are growth-oriented policies–did not seem to be

effective, especially in solving economic crises in several places. It then leads to the second
defintion that poverty is a market failure product. If the market fail, people will hardly get jobs
and they will not be able to withstand the economic shock. Therefore, through pro-poor growth
and social protection, the market is hoped to work better for poor people which entails to the
protection for the poor from poverty and increasing their ability to respond to economic risk.

Again, there is an alteration regarding poverty’s definition. Subsequently, it is seen as a

social risk. The solutions from defintion, conducted by The Social Protection and Labour Unit,
are maximizing the market to work better for the poor (opportunity), assisting the poor in
dealing with the unstable economic situation (empowerment), and providing pensions, labour,
and safety nets. Moreover, this perspective relies on formal and informal sectors rather than
the government’s help.

SUMMARY OF ANDERSON AND KUKUCHA CHAPTER 15 : AFRICAN

POLITICAL ECONOMIES BEYOND 2015

Although Africa is diverse throughout the continent–notably, culturally–all states are

facing the same problem, poverty. It seems puzzling to find out which policy is best to be
applied in order to increase their economy. However, with the help derived from the world,
several actions are spiritfully implemented comprising from financial, telecommunications,
and agriculture.

Regarding financial, it is mostly affected by liberalization–suggested by IMF–as it

generates benefits after their privatizating the state banks. Private equity and foreign state-
owned banks also contribute to ‘heal’ the economy by investing and providing finances.
Moreover, as the governments permit more freedom in their partnership with corporations and
public financial institutions, it allows them to more use the power for reducing poverty.

Concerning telecommunications (ICT), cellular network is developed in order to provide

communication access–for exchanging information–for people throughout the states. Besides,
it also generates employment and entrepreneurs, as well as small-to-medium businesses, in the
market are supported by some private lending institutions. The governments now can easily
collect data of the people.

Different from other sectors, the agriculture is asserted to be intervened by the

government or “traditionally kept and locally controlled”–from what former citizens believed.
World Bank subsequently becomes the proponent of this perspective, yet it still limits the
‘hand’ of the government. Some actions, such as investment in agriculture, help family farms
enhancing their comprehension regarding agricultural knowledges, and more advanced
agricultural methods–botanical pesticides, organic fertilizer, etc–for attaining food security.

SUMMARY OF COHN CHAPTER 6 : INTERNATIONAL MONETARY

RELATIONS

The discussion of monetary is actually related with adjustment measures and financing.
Furthermore, regarding them, there are divergent assumptions. Liberals are more convinced by
internal adjustment measures–for recessing domestic inefficiencies–while Realists–see it as a
threat for state’s policy–and Materialists–it only benefits the developed countries–are on the
external side.

The international monetary has been altering through times. The first regime was the gold
standard, based on fixed exchange rates, promoting a more open monetary and stable exchange
rates. However, this standard failed–it did not create monetarial stability–and worsened by the
Great Depression. Subsequently, the Bretton Woods proposed whether using gold or U.S.
dollar as the key currency. Many countries preferred dollar thus IMF was established to replace
gold standard to U.S. dollar and it provides short-term loan for temporary economic problems.

However, as U.S. experienced balance-of-payments deficits, dollars became weaker.

Hence, countries reduced their possessions in dollar. This then evoked the creation of floating
exchange rates which reminisced to the no-goverment-intervention era; it lets the market works
on its own. Still, this regime also encountered problems with volatility and misaslignment of
currencies. The good example to observe can be from EMU which has applied euro as a
monetary union in Europe and has led to the reduction of exchange-rate volatility, lower
transaction cost, more transparency, and creation of better functioning market.

In sum, the U.S. dollar will still confront an uncertain future as it is ‘wobbly’ due to
deficit and debt matters.

SUMMARY OF COHN CHAPTER 8 : REGIONALISM AND THE GLOBAL TRADE

REGIME

Discussing regionalism, the definition is broad since it is related to geographical, cultural,

political, and organizational aspect. Changes in regionalism involve the contribution of
historical experience and globalization. Regionalism had two-waves of evolution. Its first
wave, indicated with the emersion of EC and EFTA, was more plurilateral, same-region based,
and discriminative. Whereas the second wave–since the creation of WTO–is “more wide-
spread and durable”–the total opposite of the first. Furthermore, globalization itself affects
regionalism by creating states’ interdependence to international institutions for solving
domestic problems which it is perceived either able to bolster regionalism’s growth or the other
way around. In addition, RTAs are notably influenced by GATT for declining trade diversion.

In IPE perspectives, regionalism–according to liberals–is seen as an alternative way for

trade liberalization–as it is able to ‘vanish’ national trade barriers. Moreover, in other respects,
regionalism is like a ‘saviour’ for ‘healing’ the economic problems (however, in fact, there are
also liberals assuming that regionalism is a troublemaker as it creates trade diversion). On the
other hand, realists and historical materialists share a same argument that there is an imbalance
use of power undergone by the more powerful members. Realists believe that larger members
will retain the smaller members in acquiring benefits from RTAs. Materialists then add that
MNCs will suppress the poorer states by creating lowest-waged production thus MNCs benefit
more.

Several examples of RTAs are NAFTA (free trade area), EU (customs union), EMU,
(economic union), Mercosur, ASEAN, etc.