Finance is global. A cutback in Chinese GDP forecasts and share prices drop around the world. The US Federal Reserve contemplates adjusting the interest rate target and repercussions are felt across developing, emerging and advanced markets. Institutional failures in the Eurozone trigger members’ cut off from international financial markets, precluding the funding of government expenses. What dynamics lie behind these phenomena? Which factors account for the ups and downs of international capital flows, impacting countries of all kinds and sizes? What rules structure the system, and where do they come from? Thus, what is the global financial system, and how was it created?

 

The first part of the seminar will trace the historical origins of modern finance: from Italian city states to the banking dynasties spanning across Europe; from the reign of haute finance in the 19th century to the collapse of the gold standard in the interwar period; from the creation of the Bretton Woods system to the onset of financial globalization in the 1970s; from emerging markets crises in the 1990s to the Great Crash at the system’s center a decade later.

 

The second part will build on this rich empirical material and discuss theoretical approaches of International Political Economy (IPE) in pursuit of finding answers to the question: who rules global finance? Is it powerful states, financial interests, transnational experts, economic ideas, the structure of the system, or, rather a mix of them all?

 

Finally, the empirical and theoretical bases will enable the assessment of current opportunities and challenges in the regulation of international capital flows.

 

The course is oriented towards advanced BA students.