UC Irvine

How do we explain institutional changes in the organization of global capitalism? Empirically, this research applies a historical institutional analysis to two classic questions of modern political economy: what caused the breakdown of the postwar “Bretton Woods” economic system, and what caused the development of neoliberal globalization? This latter contemporary state of affairs is characterized by the dominance of finance in global economic activity, expansion of markets and private property into wider areas of society, and liberalized flows of money, capital, and products across international borders. I investigate the formation of these institutions through direct archival analysis of United States Government policy, and modern institutionalist theory. My primary finding is that the U.S.-led breakdown of Bretton Woods was neither economic determined nor politically designed, but rather was a choice contingent upon international negotiations that took place within the International Monetary Fund (IMF). Further, the analysis finds that the U.S. Executive Branch consciously used perceptions of an international monetary crisis to shield their political decision from scrutiny. This explains why common understandings of this case view it as economically determined, and I argue that economic crises more generally can be deployed as political constructs in the service of undemocratic policy change. Lastly, I employ the main currents of research on contemporary neoliberalism to examine how different explanations intersect, explaining the reshaping of the IMF after its Bretton Woods mandate was removed. I find that U.S. action toward the IMF established private finance as a central actor in the global economy, and the IMF as a lever of policy change to ensure the rights of private banks.