Georg Kell and John Ruggie
The international economic order constructed by the West after World War II reflected a highly advantageous configuration of factors that produced a generation of sustained economic expansion. The world distribution of economic power favoured an open and non-discriminatory approach to organizing international economic relations. There was broad ideological consensus regarding the role of the state in ensuring domestic employment, price stability and social safety nets. A commensurate body of economic analysis and policy prescriptions existed that enabled the state to act on these preferences. The major corporate actors were national in scope and international economic relations largely comprised arms-length transactions among separate and distinct national economies. As a result, point-of-entry barriers to economic transactions constituted meaningful tools of economic policy. The prevailing form of nationalism was the civic not ethnic kind, which facilitated international economic cooperation and, in the case of western Europe, the process of supranational integration. A set of international organizations was put in place that expressed and supported the post-war compromise of embedded liberalism, as it has been called (Ruggie 1982), most importantly the Bretton Woods institutions, the GATT and the United Nations.
Much has changed in the past half century to erode the efficacy of this set of understandings and arrangements. However, no factor has been as consequential as the expanding and intensifying process of globalization (Ruggie 1996). At bottom, globalization has increasingly disconnected one single element - networks of production and finance - from what had been an overall system of institutional relations, and sent it off on its own spatial and temporal trajectory. This has produced two disequilibria in the world political economy, which will persist unless and until the strictly economic sphere is embedded once more in broader frameworks of shared values and institutionalized practices.
The first is between the strictly economic sphere, and the broader frameworks of shared values and practices within which the economic sphere has been embedded at the national level. The second imbalance is in international governance structures. There has been a significant expansion of global