Cycles of polarization and settlement: diffusion and transformation in the macroeconomic policy field

Abstract

Innovative theories and policy proposals originating in the economics profession have diffused globally over the past several decades, but these models and policy programs are transformed as they spread. Existing models of change based on the concept of "paradigm shifts" capture the transformation of the economics profession at a high level of abstraction, but analysis of more concrete policy changes and associated ideas requires developing theory at a lower level of abstraction. I propose field theoretical model of change based on the concept of cycles of polarization and settlement. According to this model, settlements are characterized by multiple cross-cutting axes of competition and debate in a professional field. Moments of contention emerge when field entrepreneurs successfully build professional movements, resulting in polarization. However, contention is episodic and followed by the emergence of "centripetal forces" which lead a gradual return to the center. I develop this model by examining the case of monetary economics and policy in Latin America, a critical case for studies of the policy influence of economic ideas and experts.

The IMF and the European Debt Crisis

“…73 The operational departments could often see that financing to alleviate austerity was not available. Other critical commentators went further and used terms like "organized hypocrisy," "escalating hypocrisy," "institutional schizophrenia," and "strategic ambiguity" (Weaver 2009;Kentikelenis, Stubbs, and King 2016;Van Gunten 2015;Grabel 2019, 90). Political scientist Stephen Nelson concluded that "The top decision makers of the Fund have not dislodged the institutionally embedded, neoliberal-oriented mode of understanding the proper solutions to the adjustment problems of countries and replaced it with something else" (Nelson 2017, 209).…”