Susan Strange
Susan Strange was a British political economist, author, and journalist who was a pioneer of international political economy. Notable publications include Sterling and British Policy, Casino Capitalism, States and Markets, The Retreat of the State, and Mad Money. She helped create the British International Studies Association. She was the first woman to hold the Montague Burton Professor of International Relations at the London School of Economics, the first female academic to have a professorship named after her at the LSE, and was honoured with several annual awards named after her.
Early life
Susan Strange was born on 9 June 1923 in Langton Matravers, in the county of Dorset, the daughter of English aviator Louis Strange. She went to the Royal High School, Bath, and to the University of Caen in France, and graduated with a bachelor's degree in economics from the LSE during the Second World War. Like Robert W. Cox, the other founder of British IPE, she never obtained a PhD.Career
Strange earned a first in economics at the LSE in 1943. She raised six children and worked as a financial journalist for The Economist and then The Observer until 1957. At The Observer, she became the youngest White House correspondent of her time. She began lecturing on International Politics at the University College London in 1949.In 1964, Strange became a full-time researcher at Chatham House. At Chatham House, she authored Sterling and British Policy. She set up an influential research group on IPE at Chatham House in 1971. She played a role in the establishing of the journal Review of International Political Economy, which is the leading journal dedicated to IPE.
From 1978 to 1988, Strange served as the Montague Burton Professor of International Relations at LSE, and was the first woman at LSE to hold this chair and professorship. At the LSE, she built Britain's first graduate program in IPE. While at LSE, she held Visiting Professorships at the Brookings Institution, the University of Minnesota, the University of California, Columbia University, and the Bologna Center of Johns Hopkins University’s School of Advanced International Studies.
Strange served as professor of international political economy at the European University Institute in Florence, Italy, from 1989 to 1993. Strange's final academic post, which she held from 1993 until her death in 1998, was as chair of International Relations and professor of IPE at the University of Warwick, where she built up the graduate programme in IPE. She also taught in Japan, where between 1993 and 1996 she was several times guest lecturer at Aoyama Gakuin University in Tokyo.
Strange was a major figure in the professional associations in both Britain and the United States. She was an instrumental founding member and the first treasurer of the BISA, and served as the third female president of the International Studies Association in 1995. Her only autobiographical essay, "I Never Meant to Be an Academic", was republished online in 2020 and includes stories from her early life to the 1970s.
Scholarship on global politics and economics
International political economy
Strange was an influential thinker on global affairs. She played a central role in developing IPE as a field of study, and is a key figure in political economy approaches to security studies. Her 1970 article, "International Economics and International Relations: A Case of Mutual Neglect", laid out her arguments for the need of a discipline of IPE. Strange argued that power was central to international political economy. She observed that in general "economists simply do not understand how the global political economy works" due to a poor understanding of power and an over-reliance on abstract economic models; however, she added that political scientists also have a woeful understanding of how the world works due to their emphasis on institutions and power. Thus she became one of the earliest campaigners advocating the necessity of studying both politics and economics for international relations scholars. She influenced scholars such as Robert Gilpin. She was a critic of regime theory, arguing that the scholarship on regimes was too state-centric and carried a hidden bias in favor of maintaining US hegemony.In the 1980s, Strange disagreed with claims by other international studies scholars that US hegemony was on the decline. She was skeptical of static indicators of power, arguing that it was structural power that mattered. In particular, interactions between states and markets mattered. She pointed to the superiority of the American technology sector, dominance in services, and the position of the US dollar as the top international currency as real indicators of lasting power. She also disagreed with the attempt of economists led by Milton Friedman to mimic the natural sciences, which she thought was both dangerous and misplaced.
Power and international financial markets
Strange's key contribution to IPE was on the issue of power, which she considered essential to the character and dynamics of the global economy. She distinguished between relational power and structural power. Her works were generally successfully and were republished in subsequent years. States and Markets delineated four key forms of power—security, production, finance, and knowledge; power was described as the ability to "provide protection, make things, obtain access to credit, and develop and control authoritative modes of interpreting the world". Strange posited that the most overlooked channel of power is financial access, which consequently becomes the most important one to comprehend; in other words, she argued that one cannot comprehend how the world works without a thorough understanding of international financial markets.To illustrate, Casino Capitalism discussed the dangers of the international financial system, which she considered confirmed by the 1997 Asian financial crisis. According to Strange, there is a financial "contagion" creating a huge instability in the international financial markets. Her analysis in States and Markets also focused on what she called the "market-authority nexus", the see-saw of power between the market and political authority. She maintained that the global market, relative to the nation state, had gained significant power since the 1970s and that a "dangerous gap" was emerging between the two. She considered nation states inflexible, limited by territorial boundaries in a world of fragile intergovernmental co-operation; "Westfailure" is what she called Westphalia. Markets would be able to flout regulations and reign free, creating more uncertainty and risk in an already chaotic environment.
Casino capitalism
In Casino Capitalism, also republished by Manchester University Press, Strange problemized the nonsystem that the international monetary system had become. In popularising the concept of casino capitalism, she compared it with a casino whereon the foreign exchange plays as snakes and ladders. She set the stakes that international finance had become stronger than states and deregularised. The Smithsonian Agreement was weakened, leading further to benign neglect from the US, while the Eurodollar market and OPEC strongly undermined the Bretton Woods system. According to Strange, there is no state or actor governing the international monetary system and the international financial markets. American banks are made free to pursue their interests since the 1980s strengthened by the possibility to finance American bonds in the world, making a carousel of bond trading with the OPEC and the Eurodollar market. The forces of market integration set by the Bretton Woods system was going through.Casino capitalism is the high risk-taking and financial instability associated with financial institutions becoming very large and mostly self-regulated, while also taking on high-risk financial investment dealings. This has been a driving motive by investors in the quest for profits without production; it provides a speculation aspect that offers prospects for a quicker and more speculator returns for people, wealth, and inside assumptions of the factors likely to affect asset price movements. Typically, this does not add to the collective wealth of an economy, as it can instead create economic instability. Popularised by Strange in 1986 through her eponymous book, casino capitalism falls alongside the idea of a speculation-based economy where entrepreneurial activities turn to more paper games of speculative trading than actually producing economic goods and services. It is believed by economists such as Frank Stilwell that casino capitalism was one of the leading causes of the 2008 financial crisis. Investors sought out a get-rich-quick motive they found through speculative activities that offered a particular individual gain or loss depending on the assets' future movements. Other economists like Hans-Werner Sinn have written about casino capitalism with commentary outside the Anglo-Saxon financial bubble.
In Rival States, Rival Firms, Strange discussed the structural change in international production and its related implications for developing countries. Mad Money updated the analysis of Casino Capitalism to the late 1990s. At the time of her death, she was working on an exposition of her theory of the international money system. Strange argued in Mad Money that complex derivatives, such as credit default swaps, had increased systemic risk in the global financial system. She has been described as a prescient thinker who foresaw multiple aspects of the 2008 financial crisis and its aftermath. In 2024, the BISA organised an event on Strange's work, which "has enjoyed a renaissance recently".