Assess why the era of embedded liberalism (1945-1974) came to an end

Résumé du document

One of the most important events of the 1970s was the end of the era of embedded liberalism; it brought about a change in the world order. Embedded liberalism was weakened, if not undermined, not by neo-protectionism, but by neo-liberalism (Adrian Jones 2005). Neo-liberalism entails heightened trade and financial liberalization internationally and creates competitive pressures which diminish the domestic economic autonomy of states (Adrian Jones 2005). This paper seeks to address the following question: Why did the era of embedded liberalism (1945-1974) come to an end? The aim of this study is not only to evaluate and assess the factors causing the end of embedded liberalism, but also to determine what this concept invented by Harvard's Professor John Gerard Ruggie means. It is essential to understand the main concept before it can be discussed. This paper is divided into four parts. The first part deals with the definition of the term "embedded liberalism". The second part focuses on the establishment, operation, and success of embedded liberalism before the 1970s; and the last part deals with the factors which caused the end of the embedded liberalism.

Extraits

[...] Inflation and indebtedness were the principal indicators of the crisis (Robert W. Cox 1987, 270). Consequently by the early 1970s rules concerning gold parity and fixed exchange rates ceased to be operable and were abandoned, through the rules remained in place as a framework for operating the residue of the system and for exploring the possibility for a reconstructed monetary order (Robert W. Cox 1987, 224). The end of the Bretton Woods system and of “embedded liberalism” was caused initially by the refusal or the inability of governments, especially the American government, to maintain monetary discipline and to subordinate what they considered to be their national interests to the rules and norms of the existing monetary regime (Robert Gilpin 1987, 165). [...]

[...] In consequence came into being different institutions. These included the Golden Exchange Standard with a fixed rate of exchange; the predominance of the dollar, since every currency was exchanged against the dollar; the stability of the rate of exchange; and finally the birth of the World Bank, IMF and GATT (Theodore H. Cohn 2000, 26-30). We can say also that the Marshall Plan promoted the liberal strategies of aggregate economic management, overhauled antiquated systems of public administration, and encouraged progressive tax policies, low-cost housing programs, and other measures of economic and social reform (Michael J. [...]

[...] London : Hutchinson. Sources taken from Internet French Ministry of Foreign Affairs “Economy: The French economy over the last half-century”, http://www.diplomatie.gouv.fr/en/france_159/discovering- france_2005/france-from-to-z_1978/economy_1981/the-french-economy-over- the-last-half- Jones, Adrian “Globalization and autonomy: Embedded Liberalism”, http://www.globalautonomy.ca/global1/glossary_entry.jsp?id=CO.0035 Lang, Audrew T.F Journal of economic law: Reconstructing Embedded Liberalism: John Gerard Ruggie and Constructivist Approaches to the Study of the International Trade Regime” http://jiel.oxfordjournals.org/cgi/content/short/9/1/81?rss=1century_14 19.html?var_recherche=recession+seventies Table Maddison, Augus, OECD, MEI Economic Outlook, No and Dynamic Forces in Capitalist Development. [...]

[...] This United States' recession was caused among other factors by the cost of the Vietnam War, and consequently its balance of payments was negative. Therefore there was also less confidence in key institutions such as the IMF, the GATT or the World Bank (Robert Gilpin 106) As noted above, the recession did not touch only the United States but all other Western countries including France, where in the 1970s, labour productivity halved from per year to (French Ministry of Foreign Affairs 2006). [...]

[...] Oxford: Oxford University Press. Sihata, Ibrahim F.I “Arab Oil Policies and the New International Order”, in Lillich, Richard B., eds., Economic coercion and the new international economic order, pp. 223-52. Charlottesville: Michie Co. Smith, Gordon crisis of the West European State”, in Cameron, David eds., Regionalism and supranationalism: challenges and alternatives to the nation-state in Canada and Europe, pp. 21-36. London: Policy Studies Institute; Institute for Research on Public Policy. Tew, Brian The evolution of the international monetary system 1945-81. [...]