American hegemony has passed its peak. The twenty-first century will see a more multipolar international system. Yet Western European countries may not be the United States' main foils in upcoming decades. Four new poles of the international system are now known in the business and financial press as the "BRICs economies" (Brazil, Russia, India, and China). Does the concept of "the BRICs" also have meaning within a rigorous political science framework? From the perspective of neoclassical economics, the category's justification is surprisingly weak. In contrast, a political or economic realist's framing instructs the United States to focus on states that are increasing their relative material capabilities, as each of the four is. Finally, within a liberal institutionalist's model, the BRICs are a compelling set, yet one with a deep cleavage between two subgroups: large emerging powers likely to remain authoritarian or revert to that state, and states that are securely democratic.
Key words: International political economy, Brazil, China, India, Russia, BRICs
Why the BRICs?
In 2003 the institutional investment firm of Goldman Sachs issued a research report that coined a catchy acronym: the "BRICs economies," or Brazil, Russia, India, and China.1 At the time of writing, the four large emerging economies collectively represented only 15 percent of the gross national product (GNP) of the six major advanced industrial economies: the United States, Japan, Germany, Britain, France, and Italy. Economists Dominic Wilson and Roopa Purushothaman, however, predicted that "in less than 40 years" the BRICs were likely to catch up with the six. The BRICs would then become the world's principal "engine of new demand growth and spending power," which could "offset the impact of graying populations and slower growth in the advanced economies."2 Since then the international financial press has run with the label, which has caught the imagination of investors much as the term emerging markets did a few years back. This article critically examines the "BRICs countries" concept.
These four countries are not an obvious set. Their internal politics and economics are dissimilar. Although all are federal states, only India and Brazil are well-institutionalized democracies, one of which is parliamentary and the other presidential, respectively. Russia is a declared democracy moving toward authoritarianism, while China is a Marxist people's republic. Each of the four embodies distinct cultural and linguistic traditions, though they share the characteristic of having been recognizable political entities for centuries. All four possess modern industrial sectors, with ever deepening links to the global capitalist economy, along with large areas of the economy that operate informally and outside the reach of regulators and tax collectors. Their stock market capitalization to gross national product (GNP) ratio varies from 35 percent for China (mainly in Hong Kong and Shanghai), to 60, 69, and 72 percent for Brazil, India, and Russia, respectively.3 Russia and China are significantly globalized, with trade/gross domestic product (GDP) ratios of 48 and 64 percent respectively, the latter quite extraordinary given China's large absolute economic size.4 India and Brazil are less globally integrated, with trade/GDP ratios in 2005 of 29 and 25 percent, respectively. Although three of the four BRICs countries have substantial and reasonably secure trade surpluses, India runs a persistent trade deficit. The three trade-surplus BRICs-Brazil, Russia, and China-have external debts with net present values in the $200-billion range, while India's foreign debt is about half. Russia's exports are extraordinarily concentrated in natural gas and other energy products, while the other three have more diversified export profiles. Finally, each of the quartet faces looming challenges that could choke its economic progress: China's pollution and shortages of natural resources; India's woeful physical infrastructure and continual nasty communal conflicts; Brazil's inability to grow rapidly despite today's favorable international environment of high commodity prices; and Russia's corruption and vulnerability to the "natural resource curse" of ample public funds even sans good government for its citizens and firms. …