February 22, 2019
Talks on Economic Sociology, Markets, Politics, and Organizations (TEMPO)
Mark Herman Schwartz (University of Virginia, Politics Department)
"American Hegemony" Intellectual property rights, dollar centrality and banking networks"
Abstract: How do dollar centrality and the extension of US intellectual property right (IPR) law via TRIPS interact to create US geo-economic power? Local banks in the main current account surplus countries recycle dollars into the global economy, creating huge dollar liabilities and assets on their balance sheets. This locks them into continued use of the dollar and reliance on the Federal Reserve during crises. US firms participating in the global unbundling of production have constructed commodity chains in which they capture disproportionate shares of global profits through their control over IPRs. These dynamics are symbiotic, as IPR firms also recycle their profits into financial markets as passive investment. Routinization in use of the dollar and compliance with TRIPS and US controlled commodity chains creates infrastructural power in Michael Mann’s sense. This routinization sustains US geo-economic power in the face of persistent current account deficits and growing net international debt relative to US GDP.