Glossary – Liberalism and Neoliberal Institutionalism

Liberalism and Neoliberal Institutionalism

Introduction

Liberalism is a major theoretical tradition in International Relations that emphasizes cooperation, institutions, economic interdependence, domestic political structures, international law and the possibility of reducing conflict.

Neoliberal institutionalism retains important liberal assumptions while placing particular emphasis on how international institutions can facilitate cooperation even under conditions of international anarchy.

Liberalism

Liberalism: An approach to International Relations emphasizing cooperation, institutions, individual and political freedoms, economic interdependence and the possibility of peaceful international relations.

Liberal thinkers generally challenge the idea that international politics must be dominated by power competition and conflict.

Core Liberal Concepts

International Cooperation: Joint action by states or other actors to achieve shared objectives.

International Institutions: Rules, organizations and practices that structure international interaction.

International Law: Legal rules and principles governing relations among states and other recognized international actors.

Economic Interdependence: Mutual dependence created by trade, investment, finance and economic relationships.

Democratic Peace: The proposition that established democracies are less likely to fight wars against one another.

Commercial Peace: The idea that economic exchange and interdependence can create incentives for peaceful relations.

Collective Security: A system in which states cooperate to respond to aggression against the international community.

Liberal Institutionalism

Institutional Liberalism: The view that international institutions can facilitate cooperation and reduce uncertainty.

Neoliberal Institutionalism: An approach emphasizing the role of institutions in helping states cooperate despite the absence of a central world government.

The term “neoliberal” in International Relations should not be confused automatically with neoliberal economic policy.

International Institutions

Institutions can:

• Provide information
• Reduce uncertainty
• Establish rules
• Facilitate negotiations
• Monitor compliance
• Reduce transaction costs
• Create expectations of repeated interaction
• Provide mechanisms for dispute settlement

Transaction Costs: The costs associated with negotiating, monitoring and implementing agreements.

Monitoring: The process of observing whether actors are complying with agreed rules.

Compliance: Behaviour consistent with international commitments or rules.

Absolute and Relative Gains

A major theoretical difference between liberal institutionalism and realism concerns how states assess gains from cooperation.

Absolute Gains: The total benefits obtained by a state from cooperation.

Relative Gains: Benefits considered in comparison with the gains received by other states.

Liberals generally place greater emphasis on absolute gains, while realist approaches often give greater attention to relative gains and strategic consequences.

Complex Interdependence

The concept of complex interdependence is associated particularly with Robert Keohane and Joseph Nye.

It emphasizes:

• Multiple channels of interaction
• Absence of a strict hierarchy among all issues
• A reduced role for military force in some relationships

Multiple Channels: Connections among states, international organizations, businesses, civil society and other actors.

Issue Linkage: The connection of different policy issues within international negotiations.

Democratic Peace Theory

Democratic Peace Theory: The proposition that liberal democracies have a low likelihood of fighting wars against one another.

The theory has generated extensive academic research and debate concerning definitions, causal mechanisms and historical cases.

Commercial Liberalism

Commercial Liberalism: The argument that trade and economic interdependence can increase the costs of conflict and create incentives for peaceful relations.

Trade Interdependence: Mutual dependence created by international trade.

Economic Interdependence: Broader dependence involving trade, investment, finance, production and supply chains.

Liberal International Order

Liberal International Order: An international order characterized by institutions, rules, international organizations, economic openness and norms associated with liberal internationalism.

The term is used in different ways by scholars and policymakers and does not imply that all states agree on every rule or institution.

Liberalism and International Organizations

Liberal approaches view organizations such as the United Nations and regional institutions as potentially important mechanisms for cooperation.

They can provide:

• Rules
• Information
• Negotiation forums
• Monitoring
• Dispute resolution
• Collective action mechanisms
• Repeated interaction

Major Liberal Thinkers

Immanuel Kant: Associated with ideas concerning perpetual peace, republican government and international cooperation.

Woodrow Wilson: Associated with liberal internationalism, collective security and international organization.

Robert Keohane: A major scholar of neoliberal institutionalism.

Joseph Nye: Known for work on soft power and complex interdependence.

Lisa Martin: Known for research on international institutions and cooperation.

Key Distinctions

Liberalism vs Realism: Liberalism emphasizes cooperation, institutions and interdependence; realism emphasizes power, security and competition.

Liberal Institutionalism vs Idealism: Liberal institutionalism focuses analytically on how institutions facilitate cooperation, while idealism can refer more broadly to normative aspirations concerning international relations.

Absolute vs Relative Gains: Absolute gains concern total benefits; relative gains concern benefits compared with other actors.

Interdependence vs Dependence: Interdependence implies mutual effects; dependence can involve an asymmetric relationship in which one actor relies more heavily on another.

International Organization vs International Institution: An organization is a formal entity; an institution can refer more broadly to rules, norms and practices.

Key Terms at a Glance

Liberalism | Liberal Internationalism | Neoliberal Institutionalism | International Cooperation | International Institutions | International Law | Economic Interdependence | Complex Interdependence | Democratic Peace | Commercial Peace | Collective Security | Absolute Gains | Relative Gains | Transaction Costs | Compliance | Monitoring | Issue Linkage

Related Glossaries

International Relations Theories | Global Governance | International Organizations | International Cooperation | International Political Economy | Diplomacy | Collective Security