Britain's 1931 suspension of the gold standard remains one of the most shocking policy shifts of the past century. Conventional explanations focus on changing international conditions alongside the rise of social democracy: when Britons refused to shoulder the increasing costs of defending the exchange rate, the Bank of England was "forced" to abandon the gold standard. This article refocuses attention on policymakers' causal ideas at critical moments. Drawing on numerous primary sources held in several archives, it reveals a cleavage within the Bank over the appropriate response to the flight from sterling. Following the nervous collapse of the Bank's governor, the deputy governor shifted the Bank's strategy from making defensive rate hikes to pursuing fiscal austerity. He then "temporarily" suspended gold convertibility in a gambit to forestall the election he (incorrectly) assumed would unseat the gold standard's supporters in Parliament. When the unintended experiment with a managed float proved successful, Keynes was able to persuade policy-makers to embrace the new exchange rate regime.Reducing the standard of living of the workmen by 50 percent … would be the effect of departing from the gold standard.

AbstractWhile extensive scholarship has shown that it is possible to maintain global economic openness after hegemony, economic liberalization is still thought to be unlikely prior to hegemonic ascent. This assumption is based on the conventional narrative that Great Britain began lowering its trade barriers in the 1820s as it began its hegemonic ascent. This article shows that Britain began pursuing an open trading structure in the 1780s—in precisely the multipolar world that hegemonic stability theorists claimed would be least likely to initiate the shift. This change in commercial strategy depended crucially on the intellectual conversion of a key policymaker—the Earl of Shelburne—from mercantilist foreign economic policy to Adam Smith's revolutionary laissez-faire liberalism. Using the case of “the world's most important trading state” in the nineteenth century, this article highlights the importance of intellectuals—as well as their ideas—in shaping states' foreign policy strategies. It also provides further evidence of key individuals' significance and their decisions at “critical junctures.”

The demise of the US central bank in the 1830s “Bank War” remains one of the most significant shifts in the history of American political and economic development. Traditional accounts frame the bank as the casualty of the inevitable clash of hard-money and soft-money interests and ideologies. This paper re-examines this shift through the lens of modern international relations theory. It argues that this “war,” like so many interstate wars, could have been—and very nearly was—averted. In the months prior to the outbreak of hostilities, the bank’s president (Nicholas Biddle) and the US president (Andrew Jackson) agreed to a set of reforms that both sides preferred to fighting. Jackson, however, came to believe that no amount of reform could curb the bank’s hegemonic ascent. Facing the logic of preventive war, Jackson issued a decisive veto that initiated a “total war.” His triumph in the 1832 election sealed the bank’s fate. This paper thus offers a novel interpretation of this key historical episode; and it demonstrates the value of using international relations theory to understand intrastate political dynamics.

The field of International Political Economy (IPE) is steeped in history; and most IPE scholarship today remains historical in a broad sense. Yet, IPE scholars have never been more diverse in their modes of engagement with history, in the influence they ascribe to the weight of history, or in their beliefs about the potential for human progress. This chapter analyzes each of these developments. First, it considers the field’s major modes of engaging history: holistic, comparative, and deep. This includes the use of both old and new historical methods, techniques, and approaches. The chapter then surveys the broad range of views scholars take on the influence of the past on subsequent outcomes, from accounts of strong path dependency to those of perennial change. Last, this chapter discusses the evergreen debates about whether, and how, studying the past can lead to our emancipation from it. Throughout, the chapter highlights opportunities for more “constructive engagement” across distinct bodies of scholarship.