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ID: 114186

Before hegemony: Adam Smith, American independence, and the origins of the first era of globalization / Morrison, James Ashley

Morrison, James Ashley	Journal Article
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2012.

Summary/Abstract

While extensive scholarship has shown that it is possible to maintain global economic openness after hegemony, economic liberalization is still thought to be unlikely prior to hegemonic ascent. This assumption is based on the conventional narrative that Great Britain began lowering its trade barriers in the 1820s as it began its hegemonic ascent. This article shows that Britain began pursuing an open trading structure in the 1780s-in precisely the multipolar world that hegemonic stability theorists claimed would be least likely to initiate the shift. This change in commercial strategy depended crucially on the intellectual conversion of a key policymaker-the Earl of Shelburne-from mercantilist foreign economic policy to Adam Smith's revolutionary laissez-faire liberalism. Using the case of "the world's most important trading state" in the nineteenth century, this article highlights the importance of intellectuals-as well as their ideas-in shaping states' foreign policy strategies. It also provides further evidence of key individuals' significance and their decisions at "critical junctures."

Key Words

Globalization ; Great Britain ; Liberalization ; Trade Barriers ; Scholarship ; Global Economic Openness ;
American Independence

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ID: 145016

Shocking intellectual Austerity: the role of ideas in the demise of the gold standard in Britain / Morrison, James Ashley

Morrison, James Ashley	Article
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Summary/Abstract

Britain's 1931 suspension of the gold standard remains one of the most shocking policy shifts of the past century. Conventional explanations focus on changing international conditions alongside the rise of social democracy: when Britons refused to shoulder the increasing costs of defending the exchange rate, the Bank of England was “forced” to abandon the gold standard. This article refocuses attention on policy-makers’ causal ideas at critical moments. Drawing on numerous primary sources held in several archives, it reveals a cleavage within the Bank over the appropriate response to the flight from sterling. Following the nervous collapse of the Bank's governor, the deputy governor shifted the Bank's strategy from making defensive rate hikes to pursuing fiscal austerity. He then “temporarily” suspended gold convertibility in a gambit to forestall the election he (incorrectly) assumed would unseat the gold standard's supporters in Parliament. When the unintended experiment with a managed float proved successful, Keynes was able to persuade policy-makers to embrace the new exchange rate regime.

Key Words

Intellectual Austerity ; Gold Standard in Britain ; New Exchange Rate Regime

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