The International Political Economy of 'Risk': Rationalism, Calculation and Power

Abstract

The discipline of International Political Economy faces a number of interesting challenges at present, as it seeks to incorporate a number of relatively new issue-areas. One of these new issue-areas is that of 'risk'. I attempt to redress the neglect of 'risk' by focusing on objectivist rationalism. I highlight some of the calculative practices rationalism makes possible in order to demonstrate the deeply political nature of supposedly value neutral technical pursuits, such as accounting, auditing, the practice of statistics, sampling, and credit rating. All of these practices are implicated in modernist forms of power and governance. The thesis has four parts. In Part One I discuss the premodernist precursors to 'risk' as these pertain to the Italian Renaissance in general, and the work of Niccolò Machiavelli in particular. I highlight the confrontation between Fortuna and virtù in the work of Machiavelli in order to show how the idea of fate was put under attack' I follow up this line of argumentation by highlighting the significance of Descartes for the thesis, namely his contribution to rationalism and to the ideology of individualism. I then investigate subsequent forms of modernist governance, firstly with regard to statistics and insuring, and secondly, in more general terms. In the second part of the thesis I draw on work from the disciplines of sociology, anthropology, economics and complexity theory to explain the apparent unravelling of the rationalist quest for more reliable forms of knowledge. In the third part of the thesis I mount three case studies. The first one is a critique of the International Monetary Fund's discourse as it pertains to the management of risk in the international financial system. I show how this discourse is a form of power/knowledge and how it helps as such to maintain a disciplinary and normalising structure to international finance. The second case revisits accounting and other calculative practices, such as auditing, and subjects them to a more detailed critique. I argue here that where one might expect to find the ideology of neo-liberalism informing the best way to manage risk in the international financial system, we find accounting rationality being used instead. The third and final case presents a critique of the stalled Multilateral Agreement on Investment. I examine the sharing of rights and risk between the public and private spheres to demonstrate the asymmetrical nature of this proposed agreement. Part four of the thesis attempts to contextualise risk-in-modernity and calls for the study of 'risk' to be incorporated more fully into the discipline of International Political Economy.