International Workshop On “Reclaiming Development in the Age of Financial Globalization” Organised by IDEAs and Bilkent University (Department of Economics), Ankara, Turkey, 31 August - 3 September 2005.

The workshop on Reclaiming Development in the Age of Financial Globalization was an intensive programme covering theoretical and policy issues in the current international context. The workshop was organized by the International Development Economics Associates (IDEAs) in collaboration with the Bilkent University Department of Economics and financial support from the United Nations Development Program (UNDP). Its objective was to present critiques of existing theories as well as to offer alternative analyses of current economic trends from a developing country’s perspective. It broadly dealt with three themes:

(1) The economics of financial globalization and its implications for development macroeconomics.

(2) The macroeconomics of stabilization and adjustment.

(3) Structures and mechanisms of the global economy and the economics of collective imperialism.

Participants were selected on the basis of their publications and a letter of recommendation. Selected participants were bright young economists who have either completed or about to complete their Ph.D. dissertations. Moreover, individuals involved in advocacy work with civil society organizations or engaged in policy making activities were also included. The total working time of the workshop was 24 hours spread over four days. The workshop participants also attended the International Conference on Development Economics titled, “Acts of Resistance” Against Globalization from the South, organized by the Turkish Social Sciences Association (TSSA), from 5-7 September 2005. IDEAs provided full funding for travel and accommodation to the participants from low-income developing countries to attend both the IDEAs workshop and the TSSA Conference. Forty participants from various developing countries spread all over the globe attended the workshop enthusiastically. Each session held a lecture from an eminent economist followed by an open interactive session, where the participants deliberated on various issues related to the topic of the lecture and pointed out their country specific experiences. This was particularly interesting since the participants could find out the commonality as well as their specificity of the problems faced by them.

The first lecture was by Erinc Yeldan, Professor of Economics, Bilkent University, Ankaraon ‘Determinants of Neoliberal Financial Globalization’. He was also the Programme director of the Workshop and the Conference. He spoke on the two waves of globalization (1) the rise of finance and (2) the demise of Fordist industrialization. Finally he linked up the two arguing that both of them inevitably lead to the withering away of the concept of ‘development’.

The second lecture was delivered by William Tabb, Professor of Economics, Queens College, NY, USA on ‘Financial Liberalization, Currency Crises and Developing Countries’.  He elaborated that developing countries are perennially vulnerable to Balance of Payments crises arising out of foreign exchange constraints. However there is a new offensive under globalization and financial interdependence. Finally he analyzed the issues of currency stabilization under hegemonic conditionality of international financial capital.

The third lecturer was Pasuk Phongpaichit, Professor of Economics, Chulalongkorn University, Bangkok, Thailand. Her topic was ‘The politics of development in the age of globalisation’. She articulated the social and political consequences of Development and post development. The speaker neatly brought out the politics and anti-politics of populist regimes along with the crisis of development in global perspective.

The next instructor was Prabhat Patnaik, Professor of Economics, Centre for Economic Studies and Planning, Jawaharlal Nehru University, New Delhi. He lectured in two sessions on the topic, ‘The Dominance of Finance: Implications for the Global Economy-I and II’. The second of his two sessions was the last lecture of the workshop. In the course of his lecture he tried to explain the emergence of a new kind of Finance Capital quite different from what Lenin had talked about. He viewed the emergence of this kind of Finance Capital as an instrument for muting inter-imperialist rivalry, which also defines the economics of contemporary imperialism. Such ascendancy of international finance capital in his view is inevitably associated with deflationary policies and rampant unemployment accompanied by a systematic withdrawal of the State from the sphere of economic activity. Such a perspective implies that the Nation State completely looses its sovereignty in forming autonomous economic policies and merely conforms to the policy dictates of the international finance capitalists.

The next lecture was delivered by C.P.Chandrasekhar, Professor of Economics, Centre for Economic Studies and Planning, Jawaharlal Nehru University, New Delhi. He spoke extensively on ‘Changing Structures of National and International Finance and their implications’. The focus of his lecture was to explain the shifts in international financial systems. What implications does it have on the interactions of monetary and fiscal policy? He delineated that the onset of contractionary macroeconomic policies emerged from the Washington consensus and the shifts in international financial system. The austerity with central bank independence and inflation targeting are part of the same policy package and emanate from a common ideological understanding of an inactive State in sphere of economy.

The next session was addressed by Jayati Ghosh, Professor of Economics, Centre for Economic Studies and Planning, Jawaharlal Nehru University, New Delhi. She lectured on, ‘Interactions between international trade and finance and the effects on inequality’. In her lecture she was concerned with the recent changes and implications of the world trading patterns. She also focused on the mismatch between the capital flows and trade flows; and how it translates into uneven development and emerging patterns of inequality and poverty.

These were the topics presented in the workshop and there was an overwhelming response from the participants who understandably benefited from the workshop immensely.

Course Programme:

Wednesday, 31 August:

Morning: Determinants of Neoliberal Financial Globalization. The two waves of globalization; the rise of finance and the demise of Fordist industrialization; the withering away of the concept of ‘development’.
(Erinc Yeldan, Bilkent University, Ankara)

Afternoon: Financial Liberalization, Currency Crises and Developing Countries Balance of Payments crises and developing countries; new generation crises under globalization and financial interdependence; issues of stabilization under hegemonic conditionality of international financial capital.
(William Tabb, Queens College, NY, USA) To be confirmed

Thursday, 1 September:

Morning: The economics of financial flows at the global scale; the position of the developing countries in the new international division of labor; the dominance of finance and the sources of financial fragility; the rise of the rentier class
(Gerald Epstein, University of Massachusetts, Amherst)

Afternoon: The politics of development in the age of globalisation’. Development, post development and its social and political consequences; the politics/anti politics of populist regimes, and the crisis of development in global perspective.
Pasuk Phongpaichit, Chulalongkorn University, Bangkok, Thailand

Friday, 2 September

Morning: The US in the world economy. An analytical framework to understand the current imbalances in the US and the implied financial burden for the world.
(Alex Izurieta, Cambridge University)

Afternoon: Changing Structures of National and International Finance and their implications. Shifts in international financial systems; monetary and fiscal policy interactions; the onset of contractionary economics; the expanded Washington consensus; austerity with central bank independence, inflation targeting.
(C. P. Chandrasekhar, Jawaharlal Nehru University)

Saturday, 3 September

Morning: Interactions between international trade and finance and the effects on inequality:
Recent changes in world trade patterns and their implications; capital flows and trade flows; uneven development and emerging patterns of inequality and poverty.
(Jayati Ghosh, Jawaharlal Nehru University)

Afternoon: The Dominance of Finance: Implications for the Global Economy: The hegemony of finance; the economics of the new imperialism; deflation and unemployment; sovereignty and the role of the nation state.
(Prabhat Patnaik, Jawaharlal Nehru University)

Personnel

Program Director and Contact: Erinc Yeldan, Bilkent University

Instructors:

Gerald Epstein, Professor University of Massachusetts, Amherst
C.P. Chandrasekhar, Professor, Jawaharlal Nehru University, New Delhi, India
Jayati Ghosh, Professor, Jawaharlal Nehru University, New Delhi, India
Alex Izurieta, Cambridge University
Prabhat Patnaik, Professor, Jawaharlal Nehru University, New Delhi, India
Pasuk Phongpaichit, Professor, Chulalongkorn University, Bangkok, Thailand
William Tabb, Queens College, NY, USA
Erinc Yeldan, Professor, Bilkent University, Ankara.