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Cover I-PEEL: The International Political Economy of Everyday Life

4. Debt  

This chapter focuses on the key themes of money and finance in international political economy (IPE) analysis. It describes the concepts of commodification, assetization, and financialization, and how they apply to the case of student debt. In many countries, borrowing money to pay for tuition fees and living costs is an expected part of going to university. Thinking about the emergence of personal indebtedness in the higher education system helps to foreground the international political economy of debt. The chapter then turns to other kinds of debt, including sovereign debt and household debt, and considers the reasons why people go into debt and why debts are repaid (or not). Using Islamic finance as a case study, it looks at alternatives to debt, such as non-conditional grants and risk-sharing contracts. Finally, the chapter reflects on the moral and power dynamics that underpin interest-bearing loans, as well as demands for debt cancellation.


Cover European Integration Theory

3. Neofunctionalism  

Arne Niemann, Zoe Lefkofridi, and Philippe C. Schmitter

This chapter focuses on neofunctionalism, one of the earlier theories of regional integration. Neofunctionalist theory was first formulated in the late 1950s and early 1960s, but began to receive increasing criticism from the mid1960s, particularly because of several adverse empirical developments, the culmination of which was the Empty Chair crisis of 1965–66 when French President Charles de Gaulle effectively paralysed the European Community. With the resurgence of the European integration process in the mid1980s, neofunctionalism made a substantial comeback. After providing an overview of neofunctionalism’s intellectual roots, the chapter examines early neofunctionalism’s core assumptions and hypotheses, including its central notion of ‘spillover’. It then considers the criticisms that have been levelled against it before turning to later revisions of the theory. Finally, this chapter applies the theory critically to explain the nature and probable outcome of the sovereign debt crisis.


Cover European Union Politics

22. Economic and Monetary Union  

Amy Verdun

This chapter introduces economic and monetary union (EMU), describingthe key components of EMU and what happens when countries join. EMU was the result of decades of collaboration and learning, divided here into three periods: 1969–91, from the agreement to creation to its inclusion in the Treaty on European Union (TEU); 1992–2002, from having the plans for EMU to the irrevocable fixing of exchange rates; and 2002 onwards, with EMU established and euro banknotes and coins circulating in member states. The chapter reviews various theoretical explanations, both economic and political, for the creation of EMU and considers some criticisms of EMU. The chapter discusses how EMU has fared under the global financial crisis, the sovereign debt crisis, and the COVID-19 pandemic. These crises highlighted various imperfections in the design of EMU and provided opportunities for further development. This chapter discusses changes made since 2009 to address those flaws and what may be yet to come.


Cover International Relations and the European Union

11. The European Union and the Global Political Economy  

Amy Verdun

This chapter examines the position of the European Union in the global political economy (GPE). It also considers key dimensions of change and development as well as the EU's impact on the operation of the contemporary GPE. To this end, the chapter discusses central ideas in international political economy and relates these to the growth of the EU. Furthermore, it analyses the EU's role in the GPE in three areas: European integration, the EU's engagement in the GPE, and the EU's claims to be a major economic power. It concludes with an assessment of global economic governance, focusing in particular on the EU's role in the financial, economic, and sovereign debt crises.