FL [May 8]

I keep saving things as drafts instead of punching publish. Woops! Gotta stop that.


The Eichengreen article was interesting to me as someone who hasn't studied monetary exchange or bases much. From the start, I assumed the greater role of the hegemon in creating and maintaining an international monetary system would be more stick than carrot; it was interesting to note that very little of the stick approach came up in the case studies later. Mostly it was advantages to systems and side-payments. Of course, in an organized system, I still think that the hegemon's main role is to provide a credible threat to reduce the probability of less powerful countries defecting. It seems necessary that one great power, whose costs of carrying out the threat are or seem to be relatively lower than anyone else's cost of doing the same, be the one to maintain order. Any benefit, in my mind, should be something as a result of the system of exchange itself, rather than something the hegemon would be expected to maintain at a cost to itself (even if the long run returns are greater than the short run costs).

I am curious whether the hegemon's market power must exceed all "rival" countries' power together or individually/regionally. In the former case, this would create rather powerless dummies, while in the latter, the system may be slightly more collaborative. The Bretton Woods case seems to bear out the latter pattern of dominance; Britain, despite being weakened by war, still had significant influence over the formation of the IMF, even though some of their desires ran counter to what the dominant power (US) wanted.

The concept of the hegemon's influence and ability to maintain stability being something that decays over time was interesting; it seemed to me that the Krasner article didn't really discuss the issue of change, and the patterns of hegemons he set up seemed to be conceptualized as permanent. Obviously, the power equilibrium changes. Though, I think it's important to note that economic growth rather than economic collapse seems to be the more profound undermining force.

As a follow-up to my thoughts on copyrights, the encoding on the HD - DVD format has been broken. You can find the code all over the internet--all 32 digits of it. The NYT has some of the story of how Digg resisted; is it a backlash against lawyers or censorship?

And as for Cohen's writing on the Triad: all I have to say is that no one should expect any country to actively maintain an agreement that costs the country more than it benefits. Any alliance is null once it's no longer useful, and that's basically what G-7 cooperation agreements are. It's unfortunate that trade-offs must be made, but if the best alternative to a negotiated agreement is higher for a given country, it's naive to blame the regime that chooses noncooperation (after all, choosing the less beneficial option would be kinda irrational). Not to imply that regimes always make the most rational choices; we'll see how Mr. Chavez's game plays out in the years to come.