Friday, 10 January 2020

Why is International Cooperation Failing? How the Clash of Capitalisms Undermines the Regulation of Finance

Lecture by Thomas Kalinowski, Ewha Womans University in Seoul, Korea

Since the global financial crisis of 2008/09, international cooperation has failed to curb volatile financial markets. Changes in the global rules of finance discussed in the G20 during the last decade remain limited, and it is uncertain whether they are suitable to help mitigate and manage future crises to come. Thomas Kalinowski argues that this failure is not the result of the ‘nature’ of the international system, the clash of national egoisms, or a lack of leadership. Instead problems of international cooperation should be investigated by looking at their deeper structural origins in the competition of different models of capitalism.

US finance-led, EU integration-led, and East Asian state-led capitalisms complement each other globally but have conflicting preferences on how to regulate international finance. This interdependence of capitalist models is relatively stable but also prone to crises caused by volatile financial flows, global economic imbalances, and ‘currency wars’. By bringing together approaches from International Political Economy and Comparative Capitalism, Thomas Kalinowski shows that regulating international finance is not a technocratic exercise of fine-tuning the machinery of international institutions, but rather a political process. International cooperation can only be successful if it goes hand in hand with deep domestic changes in each of these capitalist models.

Thomas Kalinowski is a Professor at the Graduate School of International Studies, Ewha Womans University in Seoul, Korea. His most recent book, entitled “Why International Cooperation is Failing – How the Clash of Capitalisms Undermines the Regulation of Finance” was published by Oxford University Press in 2019.

Comment: Matthew Stephen, WZB

Moderation: Sigurt Vitols, WZB

The lecture is part of the WZB lecture series “Great Crisis of Capitalism – A Second Great Transformation?