How successful is neo-liberalism in explaining why states cooperate?

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            Neo-liberalism is a political movement, which originated from Classical Liberalism during 1970s. In general, neo-liberalism stands on the same core principles and ideas of Liberalism such as to project values of order, cooperation, liberty, justice and toleration into International Relations. The same as neo-realism, respectively neo-liberalism is progeny of more old traditional theory- Liberalism. Neo-liberalism is contemporary version of Classical Liberalism, which undergone some modifications with present time pace. Its conceptual framework is based on field of study such as political economy ‘free trade’ and more recently on issues like human rights and an environment. In addition, neo-liberal foreign policy promotes free trade or open markets and Western democratic values and institutions. In broad summary neo-liberals concluded that prospects for the elimination of war lay with a preference for democracy over aristocracy and free trade over autarky. Common prescription to treat ‘disease’ of war is twin medicines of democracy and free trade (Burchill, 2005:58-63). Most of the leading Western states have joined the US-led chorus, calling for the ‘enlargement’ of the community of democratic and capitalist nation-states (Lamy, 2005: 207). However, question rises as how successful neo-liberalism in explaining why states cooperate. Is neo-liberalism the only guide theory for cooperation of states that will consequently lead us to peace and harmony?

          In international relations, Liberalism always regarded as historic alternative to Realism. Liberalism was never dominant theory, though it was not prevented from obtaining profound impact on the shape of all modern industrial societies. Its absolute difference in origin and ideas to Realist ones; made it best alternate to other people with more democratic, republican spirit. For instance, Scott Burchill stated that ‘individuals should be free from arbitrary state power, persecution and superstition. Liberalism has advocated political freedom, democracy and constitutionally guaranteed rights, and privileged the liberty of the individual and equality before the law’ (2005:55). There are four principles on which liberalism is founded. Firstly, all citizens are legally equal and possess certain basic rights to education, access to free press, and religious toleration. Second, the legislative assembly of the state has only the authority invested in it by the people, whose basic rights it is not permitted to violate. Third, a key dimension of the liberty of the individual is the right to own property including productive forces. Fourth, Liberalism contends that the most effective system of economic exchange is one that is largely market driven and not one that is subordinate to bureaucratic regulation and control either domestically or internationally (Dunne, 2005:186).

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               David Baldwin, one of the neo-liberals, put forward four arguments to back up the core principle of neo-liberals. These principles reside on idea that states must cooperate with each other and promote liberal values worldwide. For neo-liberalists, international political agenda is extensive. It contains not only national security and safety dilemmas, but as well as social, cultural and ecological issues such as famine, droughts in less developed countries. Neo-liberals tend to reject the high versus low politics dichotomy accepted by most realists. Socioeconomic issues are often as important as military concerns.  Neo-liberals’ theory is theory that promotes free trade or open markets and Western democratic values and institutions. Therefore, it is opposing any possibility of war or conflict between states. Baldwin categorized different variants of neo-liberalism, which influence contemporary international relations, into four divisions such as commercial, republican, sociological and Liberal Institutions.

        The first, commercial Liberalism advocates free trade and a market or capitalist economy as the way towards peace and prosperity. Free trade will also break down the divisions between states and unite individuals everywhere in one community. It will encourage international friendship and understanding. Paraphrasing Immanuel Kant, unhindered commerce between the people of the world would unite them in common, peaceful enterprise (1903:123-131). Neo-liberals argue that the expansion of the international economy made it more costly for states to go to war. Schumpeter made an argument of why liberal principles and institutions have pacifying effects. Mainly, each country wants to obtain absolute gains. They are not interested in relative gains as realists do. States are less concerned with gains or advantages achieved by other states in cooperative arrangements. Prime motivation of expanding and cooperating with other free market countries is interdependence in economic spheres. Western countries have very close coherent connections with each other, due to free trade. For instance, successful creation of European Coal and Steel Community (ECSC) in 1952 and the European Economic community (EEC) in the Treaty of Rome in 1956. The EEC (now EU) played prime role of integrating Western Europe together. The reason of origins of the EEC was prevention of future possibilities of war in Europe. The idea was to create common interest in trade and collaboration among members of the same geographical region. Especially, Germany and France, these to nations used to solve problems militaristically. Whereas, now they cooperate within a common agreed economic and political framework for their mutual benefits.   Therefore, they are not interested in breaking these profitable economic ties. Schumpeter saw interaction of capitalism and democracy as the foundation of liberal pacifism. He theorized that instead of using old techniques to expand or gain through aggressive attack, it is more civilized way to choose to conquer other spheres such as economical. It implies the expansion of their closed markets (Doyle, 1986:1152-1154). In addition, he believed that capitalism and democracy are forces for peace. They are opposing to imperialism or any form of it. The further development of capitalism and democracy means that imperialism will inevitably disappear. Schumpeter maintains that capitalism produces unwarlike disposition. The spread of common markets would place societies on entirely new foundation. Burchill:”instead of conflicts over limited recourses such as land, the industrial revolution raised the prospect of unlimited and unprecedented prosperity for all: material production, so long as it was freely exchanged, would bring human progress (2005:62-630.  The people’s energies are daily absorbed in production. Capitalism also ‘individualizes’ society. Consequently, rational individuals demand democratic governance and are against ‘war, expansion, cabinet diplomacy’. Capitalist liberal society wants transparency and honesty from their governments. They do not want totalitarian regime to constrain their freedoms and rights. ‘Free’ states (those enjoying political and economic freedom) were shown to have considerably less conflict at or above level of economic sanctions than ‘non-free’ states. Free states, the partly free states (including Sweden), and the nonfree states accounted for 24%, 26%, and 61%, respectively, of the international violence during the 1700-1982 (Doyle, 1986:1153-1154). Therefore, nonfree states have higher possibility to go to war, than free states, because capitalist liberal societies are more concerned with material goals. They leave small room to non-economic objectives e.g. national security.

            Furthermore, idea of commercial liberalism is minimal role of the state, while the democratic political culture required basic freedoms to be safeguarded. As Adam Smith, Scottish economist and moral philosopher emphasized the important role of the individual entrepreneur, who should be relatively unconstrained by a minimalist state. The core feature of liberal democracy is right of person to have private property and right to enjoy it, without fear of it being taken away. He believed that by pursuing their own self-interests, individual unconsciously promoting public good. The mechanism, which intervenes between the motives of the individual and the ‘ends’ of society as a whole, is what Smith referred as ‘invisible hand’ (Dunne, 2005:190). Minimal government interference into economical factors will imply more freedom of big corporations and businesses; also free movement of commodities, capital and labour.  For instance, deregulation was common in Great Britain during Thatcherist administration. Another liberalist, Richard Cobden stated:” trade brings mutual gains to all the players irrespective of their size or the nature of their economies’ (Dunne, 2005:190). Global financial institutions, most of the major trading states and multinational corporations promote commercial Liberalism e.g. World Trade Organisation, International Monetary Fund. Basically, today’s economic expansion seized enormous power and influence in every continent.

              However, realists have criticisms about neo-liberalism. Firstly, the states would not be happy satisfied with absolute gains. It is human nature to want what others want, to get what others get.  For instance, if several countries equally worked on the mutual project, but then they get different payback. There is an imminent possibility raises that states will baulk at cooperation if they expect to gain less then their rivals.

               The second, democratic (republican) liberalism, which states that democratic states are more inclined to respect the rights of their citizens are less likely to go to war with their democratic neighbours. Democratic processes and institutions would break the power of the ruling elites and curb their propensity for violence (Lamy, 2005:212; Burchill, 2005:59). War is disastrous for reluctant masses, which have to do the fighting. Whereas, war is not affecting aristocrat, ruling elites, those who conceived it at the first place. For Kant, the establishment of republican forms of government in which rulers were accountable and individual rights were respected would lead to peaceful international relations because the ultimate consent for war would rest with the citizens of the state (Kant, 1903:120-128). Paraphrasing Kant, President Ronald Reagan gave speech before the British Parliament in 1982. Reagan proclaimed that governments founded on a respect for individual liberty exercise ‘restraint’ and ‘peaceful intentions’ in their foreign policy (Doyle, 1986:1151; Reagan, June 9, 1982).

         Immanuel Kant was one of the leading liberals of the Enlightenment. He lived in the period of barbarity of international relations, where aggression among the states was of everyday occurrence. It was where self-interest, was prime to the government. The period of Enlightenment was at the cusp of new age of rights, citizenship and constitutionalism at the eighteenth century. It was the moment of new ideas; new way of looking at domestic as well as foreign politics. Although, still it was at the rudimentary level, which Kant graphically described as ‘the lawless state of savarage’ (Dunne, 2005:188-189). He wanted real change, real step towards perpetual peace and harmony. In his work, “Perpetual Peace” (1795) Kant elaborated plan how to obtain peaceableness. “Perpetual Peace” contains core liberal ideas. For instance, over the years, Kant observed that it had become increasingly likely that reason would be a substitute for the use of force in world politics and it could deliver freedom and justice (Viotti, 1999:203). For liberals as well as for Kant, peace is usual condition for international affairs. It is natural for people to live in peace, whereas war considered as unnatural and irrational. Burchill stated that “ artificial contrivance and not a product of some peculiarity of human nature” (2005:58).  In Kant’s words, peace can be perpetual. In the first place, the main position of peace concept is based on ethical principles. Mainly, society is impelled by ethical motives. This moral progress of humankind binds by mind- perceiving moral peace. Liberals have a belief in progress and the perfectibility of the human condition. Through their faith in the power of human reason and the capacity of human beings to realize their inner potential, they remain confident that the stain of war can be removed from human experience (Burchill 2005:58-59; Gardner 1990:23-39; Hoffmann 1995:159-77; Zacher and Matthew 1995:107-50).  Historically, all liberals agreed that wars were created by non-liberal, militaristic, totalitarian states for their on vested interest. Rulers and their minions for their private gains constructed wars. Moreover, they used wars as demonstration of their vanity and power through territorial conquest and expansion. Burchill said that:”wars provide governments with excuses to raise taxes, expand their bureaucratic apparatus and increase their control over their citizens. The people, on the other hand, were peace-loving by nature, and plunged into conflict only by the whims of their unrepresentative rulers” (2005:59).

                In sociological Liberalism, the notion of community and the process of interdependence are important elements. As transnational activities increase, people in distant lands are linked and their governments become more interdependent. As a result it becomes more difficult to state act independently and unilaterally and to avoid cooperation with neighbours. The cost of war or other deviant behaviour increases for all states and, eventually, a peaceful international community is built (Lamy, 2005:212). Historically, zone of peace took its origin from eighteenth century. Kant called it as ‘pacific federation’ or ‘pacific union’. More than 40 liberal states currently make up the union. Most are in Europe and Northern America, as well as on every continent. This separate peace provides foundation for the United States’ crucial alliances with the liberal powers, e.g. the North Atlantic Treaty Organization and Japan. The USA is most famous promoter of liberal democratic values and principles. In the aftermath of the Second World War, the USA took lead in dissemination of free market ideas. American foreign and domestic politics is based on liberal democratic principles such as free speech, allows different voices to be heard; free trade regime, bringing benefits to all participants; lastly, USA created and participated in creating international institutions, which constrained its actions (Dunne, 2005:196).

                In conclusion, neo-liberalism is successful in promoting cooperation, but only among liberal states. Kant described it as “separate peace”. The probability that two liberal states go to war against each other is very low. Another characteristics of neo-liberalism is international ‘imprudence’, peaceful restrains only seems to work in liberals’ relations with other liberals. Liberal states have fought numerous wars with non-liberal states e.g. Middle East, Nicaragua etc. Many of these wars had defensive character and thus prudent by necessity. Liberal states might be threatened by non- liberal states and act aggressively towards them. Mainly, because non-liberal states are not exercise any special restrain in their dealings (Doyle, 1986:1158-1168). In Perpetual Peace Kant says: “is the end point of the hard journey his republics will take. The promise of perpetual peace, the violent lessons of war, and the experience of a partial peace are proof of the need and possibility of world peace (Doyle, 1986:1163).



Baldwin, D. (ed) (1993), Neo-realism and neo-liberalism: The contemporary Debate, in Baylis and Smith (2005) The Globalization of World Politics, Oxford University Press, 3rd Edition, p.212-213.

Burchill, S. “Liberalism”, in Burchill et al (2005), Theories of International Relations, Palgrave: Macmillan, 3rd Edition.

Doyle, M.(1986) “Liberalism and World Politics”, American Political science Review 80(4).

Dunne, T. “Liberalism”, in Baylis and Smith (2005) The Globalization of World Politics, Oxford University Press, 3rd Edition.

Fukuyama, F. (1992) The end of History and the Last Man (London).

Kant, E. (1903) Perpetual Peace, Swan Sonnenschein & Co, LIM.

Keohane, R. (1984) After Hegemony, Princeton University Press.

Lamy, S.L. “Contemporary mainstream approches: neo-realism and neo-liberalism” in Baylis and Smith (2005) The Globalization of World Politics, Oxford University Press, 3rd Edition.

Viotti, P.R & Kauppi, M.V. (1999) International Relations Theory, Longman Publishers, 3rd edition.


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