ABSTRACT
This paper intends to show that the changes that occurred in the international capital movements and monetary relations have transformed the domestic political economies resulting in changes that have transformed the international political economy. Especially considering the United States, the author argues that the international economic hegemony of U.S., after the World War Two, was based on three principal elements: massive outflows of long-term capital, a commitment to stabilizing the international monetary system, and commercial liberalization. These three elements had initially broad support, both inside and outside the United States. However, when the financial and commercial openness gradually changed the domestic economic orders, the political support for hegemonic stability eroded. For the author, the battle decided there will determine the very character of the U.S. and the international political economy for the foreseeable future.
KEYWORDS:
Capital flow; liberalization