The Best Work on Political Economy in 2023

Presenting the 15th annual Albies

It’s December 31, 2023, the last day of the year, which means it is time for Drezner’s World to award its annual Albies for the most important work on global political economy published in the past calendar year. This is the 15th year of the Albies, which means I am stuck in my ways they are now kind of a tradition I guess? I had the idea for them in my first year of blogging for Foreign Policy. The Albies migrated with me to the Washington Post and now reside here at Drezner’s World.

The constant about the Albies — and I cannot stress this enough — is that they represent my own idiosyncratic opinions. There is no committee of jurors or army of minions or gaggle of referees or conclave of Reviewer 2s assisting in these choices. Blame me for all the biases I bring to the table if something important was missed. The rest of the hard-working (and super-fictional) staff here at Drezner’s World are innocent bystanders!

The Albies are named in honor of the late, great political economist Albert O. Hirschman. The important thing about an Albie-winning piece of work is that it forces the reader to think about the past, present or future of the global political economy in a way that can’t entirely be unthought.

In rough chronological order, here are the 10 Albie winners for 2023:

1. Dion Rabouin, “Big Banks Predict Recession, Fed Pivot in 2023,” Wall Street Journal, January 2nd. “More than two-thirds of the economists at 23 large financial institutions that do business directly with the Federal Reserve are betting the U.S. will have a recession in 2023,” Rabouin wrote, one of a large raft of stories published in late 2022 and early 2023 predicting both a U.S. and global recession this year in response to the Federal Reserve trying to squeeze out inflation. Neither recession came to pass even as inflation decelerated, suggesting the hard limits of near-term economic forecasting. That is worth remembering when considering how upbeat many forecasters are about what the 2024 economy will look like.

2. Shekhar Aiyar et al, “Geoeconomic Fragmentation and the Future of Multilateralism,” IMF Staff Discussion Notes No. 2023/001, January 15th. If there is a theme to this year’s Albies, it is the degree to which geopolitics and domestic politics in the great powers are attempting to reverse the economic globalization of the post-Cold War era. This IMF staff note was the first paper I read this year to systematically consider whether and how state efforts to raise barriers to exchange would hamper the global economy. Their tentative answer is as much of 7% of global output (though it would likely be much less). It’s a sobering read.

3. Sebastian Horn, Bradley C. Parks, Carmen M. Reinhart, and Christoph Trebesch, “China as an International Lender of Last Resort,” NBER Working Paper No. 31105, April. For close to a decade China hawks have been voicing concerns about Beijing’s “debt-trap diplomacy.” According to this logic, China engaged in predatory lending to countries in the Global South as a means to increase its economic and political leverage over them. Relying on AidData, this paper offers some interesting nuance to that narrative about China’s lending practices. On the one hand, China’s current lending is very opaque, which certainly warrants concern. On the other hand, the paper strongly suggests that the Golden Age of Chinese aid has come to an end. Beijing’s more recent lending seems designed to bail out previous loans gone bad. In other words, if China is engaged in debt-trap diplomacy then it keeps forgetting the “trap” part and seems determined to throw emergency lending at the problem.

4. Pinelopi Goldberg and Tristam Reed, “Is the Global Economy Deglobalizing? And if so, why? And what is next?” NBER Working Paper No. 3115, April. There has been a lot of talk about deglobalization and yet it remains a contested point whether it is actually occurring. Goldberg and Reed crunch the numbers and conclude that the answer is “not yet” (though see #10 below). More interestingly, this paper also pushes back hard on the notion that COVID-19 revealed fragility within global supply chains. If anything, Goldberg and Reed show the reverse to be true.

5. Eric Helleiner, The Contested World Economy: The Deep and Global Roots of International Political Economy (New York: Cambridge University Press). Helleiner writes books as often as I write blog posts and I really wish he would stop it, he’s making the rest of us look bad. His latest book traces the intellectual roots of the IPE discipline way before most political scientists believe it started in the early 1970s. He also globalizes his history, revealing that the marketplace for economic ideas was thoroughly globalized long before the real global economy ever approached hyperglobalization.

6. Hannah Murphy, “Why Linda Yaccarino took on the wildest job in Silicon Valley,” Financial Times, September 26th/Gabe Bullard, “Six Months Ago NPR Left Twitter. The Effects Have Been Negligible,” NiemanReports, October 11th. Back in September I discussed Murphy’s jaw-dropping FT story about Yaccarino spending the second half of 2023 acting like Kevin Bacon in Animal House while ostensibly running Twitter. Bullard’s story reveals that after NPR left Twitter, the effects on traffic to NPR’s content was negligible. This reflects a larger macro-trend of people spending less time and activity across all social media platforms.

7. Daniel McDowell, Bucking the Buck: US Financial Sanctions and the International Backlash against the Dollar (New York: Oxford University Press)/ Henry Farrell and Abraham Newman, Underground Empire: How America Weaponized the World Economy (New York: Henry Holt). Economic statecraft — pretty popular right now! So is writing good books about economic statecraft. Farrell and Newman’s book, discussed in this space back in September, considers how the U.S. developed the institutional machinery to weaponize the central role of the dollar and U.S. capital markets. McDowell’s book considers what the long-term fallout will be from all this economic coercion. Both books should be considered must-reads by anyone interesting in the future of economic statecraft.

8. Marc Andreessen, “The Techno-Optimist Manifesto,” Andreessen-Horowitz, October 16th/ Cory Doctorow, “What Kind of Bubble is AI?” Locus, December 18th. I’ve written at length about Andreessen’s manifesto in recent months. To be clear, it’s not on this list because of its brilliance; it’s on this list because it reflects a particular plutocrat mindset that, like effective altruism, takes some perfectly valid observations and then goes to eleven to produce the most ridiculous all-or-nothing ethos. In the process, I fear that Andreessen will tarnish the very good ideas that were his foundation. Doctorow’s piece is Andreessen’s doppelgänger, arguing that the current AI mania is a classic tech bubble that may or may not produce something of lasting value. I am not entirely persuaded by Doctorow’s line of reasoning either, but I can’t shake it either.

9. Rana Foroohar, “The Great Reordering,” Washington Monthly, October 29th. Foroohar has been on quite the run with her writing on post-neoliberalism. This piece is a follow-up to her late 2022 Foreign Affairs essay on the same topic. It would be safe to say that we disagree about the coherence of post-neoliberal ideas (more about that in the coming year). Foroohar is not wrong, however, when she writes, “paradigm shifts begin with narrative shifts.” How post-neoliberalism will work remains something of a cipher, but Foroohar is spot on when she details the Biden administration’s narrative deconstruction of neoliberalism.

10. Noah Smith, “Stop saying ‘there is no decoupling’. There is!” Noahpinion, December 4th. The debate about whether Sino-American economic decoupling is taking place has been raging for quite some time now. Noah’s post pushes back against an Economist story and BIS paper suggesting that it hasn’t happened yet. Smith does the best job of characterizing what is actually going on: we are seeing decoupling by attrition right now through the collapse in cross-border foreign direct investment. Over time these smaller steps will accrue into more substantive decoupling between the Chinese and U.S. economies, as third-country nodes like Mexico, Vietnam, and India begin to move up the value chain and stop relying on China for key components.

Congratulations to all the winners!