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1. Asymmetric Trade Dependence: How India Gains from Pakistan Through Re-Export Channels

Author:
Saifullah
Publication Date:
01-2026
Content Type:
Journal Article
Journal:
Journal of Political Studies
Institution:
Department of Political Science, University of the Punjab
Abstract:
The asymmetric trade interdependence between India and Pakistan is examined using the Theory of Complex Interdependence. Despite the political hostility and official trade prohibition, India has continued to beeconomically blessed by Pakistan via third-party re-exporter methods, which are the UAE, Qatar, and Singapore. Despite top-down bilateral trade falling to US$1.2 billion by 2024, compared to US$3 billion in 2018, trade experts believe the value of Indian-origin goods entering Pakistan through a backdoor channel is over US$10 billion annually. Since 2015, the trade balance has consistently been in India's favor, with Pakistan relying heavily on imports from India and having minimal potential for exports. Although this trade agreement brings some benefits to Pakistani consumers, i.e., the chance to have more inexpensive or a variety of goods, it also reveals a significant vulnerability in the Pakistani government's trade policy, which is sluggish and unnecessarily restrictive. The policy implications of the findings concern trade reform, regional interaction, and fostering economic sovereignty in Pakistan.
Topic:
Political Economy, Bilateral Relations, Exports, Trade, Trade Deficit, and Interdependence
Political Geography:
Pakistan, South Asia, India, and United Arab Emirates

2. Economic implications for Europe of a potential reintegration of Iran into the world economy

Author:
Gabriel Felbermayr, Mahdi Ghodsi, Heider Kariem, Robert Stehrer, and Yoto V. Yotov
Publication Date:
02-2026
Content Type:
Special Report
Institution:
The Vienna Institute for International Economic Studies (WIIW)
Abstract:
How would fundamental political change in Iran, leading to a democratic system with a free and rules-based economic order, affect Germany and the EU economically? In the event of change, sanctions could be scaled back, allowing Iran to rejoin the global economy. This study quantifies the economic effects of such a transformation. It neither advocates for nor legitimises the lifting or easing of sanctions under the current regime or without far-reaching and credible reforms that fully address the concerns underlying the sanctions currently in place. Using the newest available data and quantitative methods, the results indicate that lifting EU sanctions alone could raise Iran’s real GDP by more than 80% in the long run while generating moderate but economically meaningful gains for Germany and the EU of around 0.3-0.4% of GDP. These gains are driven by expanded trade, lower energy and input prices, and improved allocative efficiency. When sanctions removal is combined with plausible scenarios of productivity catch-up with Turkey or South Korea, Iran’s GDP would increase by 240-388% and the gains for Europe would increase further, underscoring the strong complementarity between trade integration and productivity growth. Moreover, Iran’s reintegration would reduce energy price volatility, improve the security of maritime trade routes, and lower migration pressures. Overall, the findings suggest that a negotiated transition and rules-based reintegration of Iran would generate substantial mutual economic benefits while contributing to regional and global stability.
Topic:
Markets, Political Economy, Foreign Direct Investment, Sanctions, European Union, Economy, Inflation, Energy, and Trade Integration
Political Geography:
Europe, Iran, and Germany

3. The Under-theorisation of Dollar Dominance

Author:
Photis Lysandrou
Publication Date:
01-2026
Content Type:
Working Paper
Institution:
City Political Economy Research Centre (CITYPERC), University of London
Abstract:
The recent period has seen an upsurge in predictions that the dollar's international dominance will at some point be challenged by a rival currency, notably the euro. This paper counters these predictions. It argues that the overestimation of the euro's ability to challenge dollar dominance is due to the under-theorisation of the foundations of that dominance, the root problem being macroeconomic theories' tradition of taking the household investor to be the representative investor when it should in reality be an institutional asset manager. If financial securities are viewed through the lens of the institutional investor it becomes clear that there can be no exodus from the dollar because it becomes clear that foreign investors remain attracted to the US capital market for reasons as much to do with its mass and consequent gravitational force as to do with a shortage of securities that can be supplied by other capital markets.
Topic:
Political Economy, Investment, Macroeconomics, Currency, Dollar, Euro, and Capital Markets
Political Geography:
Global Focus

4. From Ideas to Policy: Q&A with Ibrahim Awad

Author:
Omar Auf
Publication Date:
03-2025
Content Type:
Journal Article
Journal:
Cairo Review of Global Affairs
Institution:
School of Global Affairs and Public Policy, American University in Cairo
Abstract:
Is it possible to imagine, let alone move toward a different global political-economic order? Ibrahim Awad believes conferences and the exchange of ideas have a role to play in moving such a reality forward
Topic:
Economics, Political Economy, Politics, Neoliberalism, Interview, and International Order
Political Geography:
Global Focus

5. Peripheral Growth Models and the Global Economy: A Second Image IPE Perspective

Author:
Michael Schedelik and Andreas Nölke
Publication Date:
07-2025
Content Type:
Working Paper
Institution:
Max Planck Institute for the Study of Societies
Abstract:
The paper departs from the perspective of “second image IPE,” i.e., the need to closely combine Comparative Political Economy (CPE) and International Political Economy (IPE). More specifically, it focuses on the observation that the growth models in the (former) periphery of the global economy (a typical focus of CPE) are strongly shaped by their interdependencies with the structural transformations of the global economy (as studied by IPE). At the same time, the changes within the growth models of large economies in this periphery (CPE) can have a major impact on global interdependencies (IPE). For example, the rise of China as a major player in world trade and investment (“China shock”) has had a substantial impact on growth models elsewhere in the periphery, via import penetration, direct investment, and export demand. This paper shows how these growth models shape (and are shaped through) international interdependencies by analyzing (1) the effects of global commodity cycles on the growth experience of several major exporters of primary resources, such as Brazil or Indonesia, during and after the recent commodity boom. (2) We further elaborate on the effects of global financial cycles on peripheral countries, particularly those pursuing debt-led growth models, such as South Africa or Turkey. (3) We finally point to the role of global production chains and foreign direct investment for FDI-led growth models of manufacturing exporters such as Thailand or Vietnam in South East Asia.
Topic:
Political Economy, Foreign Direct Investment, Economy, Economic Growth, Commodities, Emerging Economies, and Growth Models
Political Geography:
Global Focus

6. Shifting Paths? The Evolution of Southern European Growth Trajectories Between the Global Financial Crisis and the Covid Pandemic

Author:
Fabio Bulfone, Mischa Stratenwerth, and Arianna Tassinari
Publication Date:
06-2025
Content Type:
Working Paper
Institution:
Max Planck Institute for the Study of Societies
Abstract:
This paper traces the growth trajectories of the Southern European economies (Greece, Italy, Portugal, and Spain) from the financial to the covid crisis. From a review of the comparative political economy literature focusing on Southern Europe, we derive three propositions regarding the growth profile, the development of high value-added services and manufacturing exports, and employment outcomes. To assess the accuracy of these propositions, we conduct growth decompositions based on import-adjusted demand components as well as on sectoral output and employment indicators. The data show that Southern European economies are similar in that export-led growth has not been sufficient to boost aggregate growth, stimulate high value-added services or manufacturing, reverse pro-cyclical employment declines, or create high-wage employment opportunities. But the Southern European economies also differ, both in terms of their sectoral growth profiles and their aggregate performance. In the second half of the decade, Portugal and Spain managed to combine domestic demand and exports to achieve stronger growth than Italy and Greece. Sectoral developments in Portugal and Spain (and to a lesser extent in Italy) tentatively suggest a potential “Iberian growth path” that is compatible with euro area constraints but ultimately peripheral. The paper concludes by considering the empirical and theoretical implications of these findings for the study of the Southern European model of capitalism.
Topic:
Political Economy, Economic Growth, Exports, and Austerity
Political Geography:
Europe, Greece, Spain, Italy, Portugal, and Southern Europe

7. The Political Economy of Starmer's Labour

Author:
Colm Murphy, Sam Freedman, Morgan Jones, Theo Bertram, and Kate Alexander Shaw
Publication Date:
03-2025
Content Type:
Video
Institution:
Mile End Institute, Queen Mary University of London
Abstract:
The first eight months of the new Labour government have been tumultuous, and nowhere more than in the politics of economics. Rachel Reeves has hiked taxes and increased borrowing, but her Treasury are also in tense negotiations with other departments over spending constraints. The Bank of England is trying to cut interest rates, but in a volatile market environment highly sensitive to developments across the Atlantic. The Government has already made itself vocal enemies ranging from tractor-driving farmers to child poverty campaigners, and businesses, trade unions, and lobbyists are currently battling to shape its policies on workers rights, planning reform, oilfields and airport expansions. What have we learned about Labour's economic policies? Do they have a coherent strategy? How united is the Labour Party and what are the emerging tensions? What would a successful economic strategy look like, given the UK's longstanding weaknesses of underinvestment and regional inequality and newer dangers like trade wars and recessionary risk? In this Mile End Institute webinar, Dr Colm Murphy, Sam Freedman (author of Britain's biggest politics Substack), the political writer Morgan Jones, former Number 10 advisor Dr Theo Bertram, and the economist Dr Kate Alexander Shaw explore the political economy of Keir Starmer's Labour Party.
Topic:
Political Economy, Political Parties, Labour Party, and Keir Starmer
Political Geography:
United Kingdom and Europe

8. Flawed by Design: What al-Sisi’s Egypt Reveals About the Myth of Authoritarian Efficiency

Author:
Johannes Späth
Publication Date:
07-2025
Content Type:
Policy Brief
Institution:
Austrian Institute for International Affairs (OIIP)
Abstract:
This policy analysis challenges the rising narrative that authoritarian regimes, despite their repressive nature, offer superior governance efficiency and contribute to regional stability. Using Egypt under President Abdel Fattah al-Sisi as a case study, it argues that the perception of authoritarian efficiency is not only analytically flawed but dangerously misleading for international policymakers. European and Western engagement with Egypt continues to rely on flawed assumptions about authoritarian capacity and stability. Financial support, arms sales, and diplomatic legitimacy are extended largely unconditionally, under the illusion that al-Sisi’s regime can deliver long-term order. This approach ignores the structural fragility baked into Egypt’s political economy, and risks enabling a trajectory toward fiscal implosion and social unrest. The paper argues for a strategic recalibration. European policymakers should shift from regime-centered engagement to resilience-centered investment, focusing on areas like education, climate adaptation, and local economic empowerment that outlast regime cycles. Europe’s current approach risks buying short-term quiet at the cost of long-term instability. A policy recalibration grounded in realism, not regime accommodation, is both necessary and overdue.
Topic:
Political Economy, Bilateral Relations, Authoritarianism, European Union, Regime Security, Regional Stability, and Regime Legitimation
Political Geography:
Europe, North America, and Egypt

9. Identifying Mutual Interests: How Donor Countries Benefit from Foreign Aid

Author:
Tobias Heidland, Maximilian Michael, Moritz Schularick, and Rainer Thiele
Publication Date:
06-2025
Content Type:
Working Paper
Institution:
Kiel Institute for the World Economy (IfW)
Abstract:
Official development assistance (ODA) is widely studied for its impact on recipient countries, but its effects on donor countries remain underexplored. To address this gap systematically, we develop a conceptual framework for understanding when foreign aid generates measurable returns for donor countries as well as those cases when donor and recipient interests align—what we term mutual interest ODA. We categorize potential donor benefits into three domains: economic, geopolitical, and security-related, and distinguish these benefits by their timing and degree of directness. We then systematically survey the empirical evidence on donor benefits, assessing the empirical credibility and magnitude of estimated effects and pointing out research gaps. We find consistent evidence of substantial donor benefits across all three domains. A key insight is that aggregate aid flows often mask significant variation: The returns to donors depend critically on the type of aid, delivery modality, and recipient context. These findings have important implications for both academic and policy debates on the effectiveness, political sustainability, and future direction of development aid.
Topic:
Climate Change, Globalization, Health, International Trade and Finance, Migration, Political Economy, Foreign Aid, and Sustainable Development
Political Geography:
Africa, Europe, Asia, and Americas

10. Hegemony and International Alignment

Author:
Fernando Broner, Alberto Martin, Josefin Meyer, Christoph Trebesch, and Jiaxian Zhou Wu
Publication Date:
05-2025
Content Type:
Working Paper
Institution:
Kiel Institute for the World Economy (IfW)
Abstract:
This article explores the interplay between economic hegemony and political alignment. Using theoretical and empirical insights from Broner et al. (2024), we posit that hegemonic states, such as the U.S., foster political alignment, which enhances globalization. We use UN voting data to proxy for international alignment and show that hegemons induce alignment. This data has shortcomings, however. UN voting only covers the post-WWII period, refers to a narrow set of issues, and displays little time variation. As for military alliances, they were not widely used before the mid-20th century. We propose an alternative measure of alignment based on international treaties.
Topic:
Globalization, International Trade and Finance, Political Economy, Treaties and Agreements, Hegemony, Multipolarity, and Geoeconomics
Political Geography:
Global Focus and United States of America