The contest between public and private goods: The application of hegemonic stability theory to the international monetary system, 1936-1956

The central assertion of the hegemonic stability school is that order in the international economic system is only achieved through the dominance of a hegemonic power. Although the benefits from this economic order are dispersed throughout the system, the costs are borne largely or even completely by the hegemon. This paper challenges this assertion, and uses postwar, U.S. foreign economic policy as a case study in which to critique the ideas of this school of thought. The results of this examination contradict several of the ideas expressed by the hegemonic stability school. Many of the gains from hegemony considered to be collective in nature are more properly seen as private goods. These goods accrued to the U.S. and helped it maintain its position of dominance. Furthermore, America's postwar, foreign economic policy emerges not as a plan to obtain economic stability for the world economy, but as a national agenda for economic dominance in support of American self-interest.