The relationship between economic globalization and the environment has spurred debate across the fields of economics, international relations, law, geography, and other social science disciplines (Clapp and Dauvergne 2011). Is economic globalization, and the political structures that support it, intrinsically bad for the global environment? Is it a net positive for the environment, as the additional wealth generated by globalization is channeled into environmental protection and technological innovation? Alternatively, is globalization compatible with a sustainable future as long as we build in institutions and processes that enable environmental – and social – protections? As Clapp and Dauvergne point out, there are no definitive answers to these questions. However, they continue to inform how scholars, activists, and policy-makers address the ways in which the global economic order intersects with global environmental politics (GEP).
In this chapter we focus on the three main international economic governance institutions identified in Chapter 3 as sites of global governance: the World Trade Organization (WTO), the World Bank, and the International Monetary Fund (IMF), known collectively as the Bretton Woods institutions, after the 1944 conference where they were founded. We examine how they have created rules and institutions that steer and shape environmental governance at all levels, including governing the impacts of their own activities. Further, we focus on how they manage this transition, including the linkages and overlap between their work and that of the global environmental governance (GEG) arena.
As the main international organizations governing trade, finance, and development assistance, the Bretton Woods institutions have been critical in defining the path of economic globalization in the decades since World War Two. More recently, they have become focal points for critics of the environmental and social impacts of capitalist, or neoliberal, globalization. We examine the origins and trajectory of the post-war global economic order, and how trade, aid, and global finance are seen both as causes of global environmental change, and – potentially – as part of a transition to a more sustainable global economy.
Scholars give different weight to the role of the international economic order in global environmental politics. In Chapter 1 we discussed the difference between scholars who approach the global environment from a collective-action perspective and those who argue, by contrast, that global environmental degradation needs to be seen in the context of global capitalism.