There are a few things that make me really hot under the collar. The first is the unending 100+ degree summer heat in central Texas. The second is the unending debate on the “state of the field”, in particular the state of the International Political Economy (IPE) discipline. It is a topic near and dear to my heart (IPE, not Texas heat). A few years ago, I was so provoked by Benjamin Cohen’s trenchant intellectual history of IPE and the reactions that followed that I put together a special issue on the so-called “American School of IPE” in Review of International Political Economy. This was soon followed by a special issue on the British School of IPE, edited by Nicola Phillips in New Political Economy. Finally, in hopes of achieving some closure on all the kvetching and navel-gazing, Nicola and I combined the two special issues and solicited a new round of essays, which came out last year as a book on the Past, Present and Future of IPE. At that point, I decided to stop worrying about the state of the field and return to more rewarding, substantive research.

But Dan’s blog from a week ago on the state of IPE today brought all the angst back. Dan raised a simple, yet powerful question: why have our top journals (specifically International Organization) had so few articles on the global financial crisis? For that matter, why do the top journals have so few IPE articles on anything of real importance to the world economy today?

Rather than stew in my juices and provide a snarky reply, I turned to some of my uber-talented IPE friends with these questions. Here are two great responses I received from Mark Blyth and Thomas Oatley, which I reproduce here, with my thanks.

From Thomas Oatley, Associate Professor at UNC Chapel Hill, author most recently of a great IPE piece in IO, “The Reductionist Gamble: Open Economy Politics in the Global Economy“:

Perhaps no research directly relevant to the American financial crisis has appeared in IO because mainstream American IPE values general knowledge over case-specific knowledge. It believes further that general knowledge is produced through the statistical analysis of large samples. David Singer, in a recent APSA Political Economy section newsletter, nicely summarizes the kind of research this orientation implies. “From a research design perspective, a reasonable way forward is to test hypotheses about the conditional impact of capital inflows on the probability of financial crises in the developed world. The scope and quality of regulation are likely contenders for inclusion in such a model. The cases of Australia and Spain suggest that large capital inflows might be less destabilizing if the banking system faces strict capital requirements and prohibitions against non-traditional banking activities. Other possible conditioning variables include, inter alia, resource endowments, partisanship, and corporate governance.”

So why hasn’t IO published research along the lines Singer proposes? I suspect that such research has yet to appear because standard statistical techniques are not well suited to the complex causality that characterizes banking crises. This causal complexity has two dimensions. The first is equifinality: multiple causal paths produce banking crises. Post liberalization “capital inflow bonanzas” that drove the Scandinavian crises is a different mechanism than the “post-Louvre over-valued yen with abundant domestic savings” mechanism that generated Japan’s banking crisis in the late 1980s, which is a different mechanism than the over-exposure to Greek sovereign debt that underlies current weakness of German banks. All three mechanisms might be different than the “zero private savings, large government deficit and global savings glut of historic proportions” mechanism that caused the US crisis.

Second, causality may be conjunctural. That is, rather than having a consistent effect across cases, the impact of a variable might depend on how it combines with other factors. An over-valued currency on its own may not increase the probability of a banking crisis, but an over-valued currency in combination with surplus domestic savings and a particular regulatory structure may have caused Japan’s banking crisis. Multiple conjunctural causality is challenging for standard statistical techniques, although techniques for managing these challenges do exist (see Bear Braumoeller. 2003. “Political Complexity and the Study of Politics,” Political Analysis 11: 209-233).

Why haven’t quantitatively oriented IPE scholars applied techniques such as Braumoeller’s to the study of banking crises? I think the problem may rest in the rarity of major banking crises. According to Reinhart and Reinhart, only 5 major systemic banking crises occurred in developed countries between 1973 and 2007. If three or four distinct causal mechanisms are at work in these five crises, it will be difficult to find statistically significant configurations among sub-sets of crises.

In short, I would argue that no articles directly relevant to the financial crisis have appeared in IO because the field attaches little value to studying the US crisis in isolation, and the banking crises with which it might share common properties are so infrequent that statistical techniques are unlikely to identify general relationships. As a result, an event of supreme global importance gains very little attention from American IPE scholars.

From Mark Blyth, Professor at Brown University, hard at work on a book about the financial crisis that is bound to be a classic in the field:

There are more than a few IPE scholars who have written about the financial crisis and its aftermath. Its just that they have done so in venues that are not as cumbersome as traditional peer reviewed journals. There are two problems with looking to such journals as venues.

The first is the ‘hit the moving target’ problem. I wrote a piece in 2008 called ‘this time it really is different’ on the 2008 crisis and the EU, and by the time I got editor comments, it had morphed into the Euro crisis. Add publication time-tabling into this and almost anything you can say about this is redundant. By the time you revise it to catch up its redundant again. Economists (as usual) have an advantage over us with sites like the NBER and VOXEU designed to get it out quickly, so they get the press.

The second is the ‘discipline of discipline’ problem. Frankly, younger IPE scholars are taught to work with quant data and not say anything beyond it. That’s the skill set. They are taught to do ‘tractable’ questions. What’s tractable about the GFC? That’s a problem when past data is absolutely no use in discerning future trends beyond broad Reinhardt and Rogoff ‘lets dump medieval Spain and modern France in the same data set and talk about defaults’ approach.

Others can talk about intellectual hegemony and the like, but as someone who has sat on a board for many years, I can say its the submissions or lack thereof the is the real killer. Why aren’t IPE journals publishing crisis work? Possibly because no one is submitting it? Or because its much more bang for the buck and much faster to publish in Foreign Affairs or on line?

One last thought. All journal submissions need to be tied into disciplinary debates in order to pass the sniff test at a journal. So what is the debate that the crisis ties into that IPE has a track record on? US decline (got that wrong several times)? Institutional change (most popular models are all about incremental change while the world gets smacked by a Black Swan every week)? Diffusion? (of what, panic)? Human Rights and Trade? (relevance?)

The fundamental problem is that IPE imagines a world quite unlike the one we actually inhabit much of the time. As a consequence when we are asked to comment on the world we actually inhabit, we have little to say.

Finally, I should note that there are in fact some great works out there by IPE scholars that directly hit on the current global financial crisis. I won’t try to be comprehensive, in fear of overlooking several obvious examples, but I’ve read (or re-read) three in the past month that are simply terrific: Herman Schwartz’s Subprime Nation; Randy Germain’s Global Politics and Financial Governance, and Eric Helleiner, Stefano Pagliari and Hubert Zimmermann’s (eds) Global Finance in Crisis.

If anyone out there can point to other great sources – in journals and books – please send in your suggested readings list.