Neorealism vs. Neoliberalism: Comparative Analysis


The neoliberalism and neorealism debate has remained dominant in the International Relations theory over the past few decades. These two schools of thought, often referred to as the neo-neo debate, defines the policies that a country embraces in international relations. As Ringmar observes, every country is often keen on developing a mutually beneficial relationship with its neighbors and the international community (65).

However, it is common to find cases where there is a conflict of interest on issues such as trade, military policies, and climate change among others. The two schools have often been used by different states to define the approach that they take to address such conflicts and to embrace policies that they consider beneficial. In this paper, the researcher seeks to conduct a comparative analysis of the neorealism and neoliberalism. The study will review the history and background of these schools, their key concepts and main ideas, possible similarities and differences, and what policy-makers in the United Arab Emirates can learn from the two theories to inform their decisions.

History and Background of Each Theory

Neorealism, sometimes referred to as structural realism, is one of the most influential theories in the modern-day international relations. In 1979, Kenneth Waltz published a book titled Theory of International Politics (Ferreira 67). It was the first time that a scholar provided a comprehensive analysis of the concept of neoliberalism. It is believed that the theory emerged from North America in the field of political science and has since gained massive acceptance among scholars and policy-makers at the international arena. The primary belief of this school of thought is that power is the most essential factor in the field of international relations.

When two or more countries have to negotiate over any form of agreement, each of them will strive to have a deal that is most favorable to them. A good example is the ongoing BREXIT negotiation between the United Kingdom and the European Union. Each of these two parties is keen on reaching an agreement that they consider most beneficial. This theory holds that in such negotiations, the party that wields the greatest power is likely to win. They will use their power to influence the decision and to limit the ability of the other parties to get what they need.

Neoliberalism in international relation has also gained popularity in the global level since early 1990s. According to Qin, Joseph Nye and Robert Keohane have been credited as the founders of this theory as they focused on revising liberalism as a school of thought in international relation (41). Their teachings and theory has since gained a widespread acceptance around the world. Benczes observes that neoliberalism holds the belief that states should primarily be concerned with absolute gains instead of relative gains to other states (9). In most of the cases, countries focus on what they will gain in economic or military negotiations in relation to that of other nations in the table.

The United States will be keen on ensuring that in its trade deal with China, its gains should be higher than that of the other party. Neoliberalism argues that taking such a simplistic approach to international relations may lead to disagreements because there is no country that would want to be seen as a looser in such deals. The best approach is for a country to focus on absolute gains. For instance, in a trade deal between the United Arab Emirates and Japan, each of the two parties should focus on the long term gains they will get and the sustainability of the relationship. Instead of focusing on how to take advantage of the other party or to have greater gains, one should focus on creating a mutually beneficial relationship where every state involved will benefit.

These two schools of thought have dominated international relations over the past three decades. According to Ferreira, many countries around the world have used these two concepts in different contexts to achieve varying goals (85). The United States has often used neoliberalism when engaging the European Union because both parties are powerful. However, the country has been using neorealism when defining its international policies with regard to countries such as Iran, North Korea, and Venezuela.

Key Concepts and Main Ideas

The neo-neo debate has been raging for the last three decades as political scientists seek to find the best approach towards international relations. Each of these theories have been applied by different states in varying contexts (Lestaria et al. 60). In each cases, there is always a justification that these countries make as to why it is more appropriate to use one and not the other. It is necessary to assess some of the key concept in each of these two schools of thought and their main ideas. The assessment will help in determining which the most appropriate theory to develop foreign policies is and when it is appropriate to use one and not the other.

Neorealism has various fundamental concepts that have made it one of the most preferred theories of international relations. It holds the belief that each state is always seeking for its own interest and that no nation will be willing to subordinate theirs for the interest of another. When the UAE is getting into an agreement with one of its neighbors or any other country in the world, its focus will be to take care of the interest of its citizens. Any deal that will require the UAE to sacrifice its interests for the sake of the other party may not be acceptable.

Neorealism’s other major concept is that at the very minimum, each state is keen on protecting their survival as the primary goal in international relations. As such, it is justified for a country to develop offensive military capabilities as a way of enhancing their power relative to the source of threat (Febrica 117). They have to be in a position to fight any form of threat to their existence using any means necessary. The UAE has been keen on equipping and improving its military because of the need to protect its borders from any possible threat of foreign states. Israel always feels that its existence is under threat from some of its neighbors.

As such, it has invested heavily in the military as a way of self-protection (Scribano et al. 44). It has also been keen on aligning itself politically with some of the global powers such as the United States and the United Kingdom. The security dilemma, that is often caused by lack of trust between two states, such as the one between Taiwan and China, may force a country to embrace offensive foreign policies instead of developing mutually beneficial relationships.

Neorealism holds the belief that states have similar needs, such as good healthcare, employment for all its capable citizens, improved infrastructure, and a powerful voice in the international community, but the capability of achieving these needs vary. Problem arises in international corporations when the fear of relative gains arise among the states. The imbalance of power between the UAE and the USA will constantly create a sense of mistrust (Qin 82). The UAE will have the fear that the US will use its power to negotiate a deal that only favors it at the expense of the lesser powerful partner. On the other hand, the US may develop a feeling that THE UAE should be making most of the concessions as the weaker party in the deal. Such perceptions may cripple trade and military corporations between states.

Neoliberalism also has its fundamental principles and concepts which make it one of the best theories for foreign relations. One of its fundamental principles is its emphasis on a win-win arrangements in foreign relations (Czaputowicz and Wojciuk 56). The proponents of this theory argue that in almost all the cases, conflicts of interest will arise in international corporations. States involve may opt to embrace a zero sum game where they all lose or be optimistic enough to focus on mutual benefits. The mutual benefit can only be realized if both parties are willing to make realistic concessions for the sale of a jointly profitable arrangement. When the parties get into a negotiating table, they will be having their own demands and expectations. However, a win-win arrangements require them to be willing to relax some of their demands based on the facts presented by both parties.

Neoliberals believe that even in times of anarchy, states can still consider cooperation as a way of addressing the existing challenge. The Arab Spring affected numerous nations in the Middle East and North Africa region as various regimes were forced out of power (Febrica 114). The instability in the region was significantly compromised and the rule of law was losing its footing. ISIL took advantage of this problem to spread its operations beyond Iraq and Syria.

However, the UAE and all the states within the region chose cooperation over rivalry as a means of addressing a common problem. They decided to work as a unit to fight this radicalized group that was threatening their existence (Dursun-Özkanca 90). It was a demonstration that even in times of challenge, just like in cases of socio-economic and political success, corporation is critical.

Neoliberalism holds the argument that the anarchic nature of international relations has been exaggerated for the benefit of some powerful nations around the world. Some states have used this belief to unfairly engage in activities that hurt other sovereign nations with perceived weaker military or economic power (Czaputowicz and Wojciuk 78). In 2014, Russia used successfully annexed Crimea from Ukraine citing anarchy and fear of insecurity in the region and lack of commitment and capacity of the Ukrainian government to support inhabitants of this region (Dursun-Özkanca 76). It took advantage of its military strength over Ukraine to act in a way that is only beneficial to it at the expense of the other state. Neoliberals strongly opposes such acts as they contribute to instability or a region or the world.

Differences and Possible Similarities between the Two Theories

The comparative assessment of each theory, done in the section above, has identified major principles and beliefs of the two theories and their major differences. The analysis done above has identified the approach to international relations as a major difference between these two theories. While neorealism emphasizes the need for confrontational approach to international relations, neoliberals believe that diplomacy is critical. A neorealist believe that when two or more states are trying to develop an economic or political relations, it is likely that the state with the greater power will have the capacity to dictate terms of arrangements.

For instance, the United States has always had immense power in controlling international relations at the global label because of its military and economic power. In the past, it has placed economic sanctions against Cuba, North Korea, Iran, and Russia as a way of forcing them to act in a given way (Benczes 11). Such suctions have forced some of these nations to give in to the demands of the United States as a way of protecting their economy and the political class.

Sometimes it has used its military power to force some rulers out of power, such as the case with Saddam Hussein of Iraq and Muammar Gaddafi of Libya. On the other hand, neoliberals emphasizes a win-win kind of arrangement among parties involved. It promotes dialogue and the need to ensure that the outcome of the arrangement is mutually beneficial to all parties. It strongly discourages the use of economic or military power to force a country into acting in a given way. Although it acknowledges that different countries have varying capabilities of achieving their goals, this theory highly cherishes mutual respect among actors involved in the dialogue (Lestaria et al. 61). The mutual respect creates trust among states and the commitment to create a better world.

It is important to note that despite the above major differences, the two theories of foreign relations also have some fundamental similarities. According to Jackson et al., both theories view states and their interests as their central subject of analysis (34). They are both focused on determining how different states relate with one another in the international arena in their quest to achieve growth. Irrespective of the level of development, it is not possible for a country to have all the resources it needs within its borders. Germany is one of the developed nations in the world, but it depends on oil from Nigeria. On the other hand, Nigeria, which is classified as a developing country, needs cars manufactured in Germany to facilitate its economic growth. These two states must protect their interests when they are having economic agreements. These two theories both look at the how such states, which sometimes may have conflicting interests, may work to achieve their goals.

It is also evident that neoliberalism and neorealism are both positivist theories that focus on state system. As Ringmar observes, positivism as a philosophy holds the view that genuine knowledge is exclusively derived from the experience of natural phenomena (78). In both cases, there is a consensus that experiences that a country has had may influence the international relations policy that they embrace. The long military and political tension that has been in existence between the United States and Russia since the period of the Cold War has created a deeply-rooted mistrust between the two states.

In any foreign relations arrangement between these two countries, it is common to have accusations and counteraccusations because of the mistrust. In such cases, having a win-win arrangement may not be easy. However, sometimes in an effort to protect their national interest, they have to make a consensus, such as the reduction of nuclear stockpiles in each of these nations. On the other hand, the long cordial relations between the United States and Canada makes it easy for them to sign mutually beneficial trade and military deals because of the trust and respect.

Summary of What Policy Makers in the UAE Could Learn From These Theories

Policy-makers in the United Arab Emirates can learn a lot from the two theories discussed above. One of the major lessons that is evident in the analysis above is that the primary goal of leaders when developing foreign relations policies is a country’s survival. They should ensure that any economic, political, or military engagements that they embrace are all focused on protecting the borders and citizens of the country. It is also evident that although it is always undesirable, sometimes the country may be forced to use military means to achieve specific goals. The threat that the country faces from some militant groups such as ISIL may need military intervention because such anarchic groups lack grounds upon which they can negotiate win-win kind of arrangement. However, any military intervention should have proper justification.

The two theories also shows that policy-makers in the country should always focus on having a win-win kind of arrangements in its foreign relations policies. It is common for parties involved in a negotiation to have conflicting interest. It is normal for each state to champion for the interest of its citizens. As such, the only way through which two or three states can have a sustainable relationship is to develop policies that promote mutual interest.

Every state should benefit from the arrangement without unfairly exploiting others. The theories also provides a warning to the local policy-makers when entering into economic or military arrangement with a more powerful state. It is likely that the powerful state will try to use its economic and military strength to have a leverage in such talks and to have an agreement that is skewed in their favor. Such situations should be eliminated as much as possible.

The perspective that these theories give to the decision-makers is that they should always focus on protecting the interest of their country. Neoliberalism appears to be a popular theory in foreign relations because of its non-combative nature and commitment to having win-win policies. Local leaders should consider embracing this theory in international relations, especially when making trade deals with powerful nations such as the United States and China.

It will eliminate or significantly reduce the possibility of these nations using their power to frustrate interests of the country. Despite the desirability of neoliberalism, the policy-makers must understand that sometimes it is necessary to use neorealism. When dealing with an aggressor that is not willing to engage in a mutually beneficial dialogue, the primary goal of these leaders should be to protect the nation. Achieving such a goal may require involvement of the military, which means that a well-trained and properly equipped military should be part of the country’s foreign policy.

Works Cited

Benczes, István. “Conflict and Cooperation in International Relations: The Cohabitation of (Neo) Realism and Neoliberal Institutionalism.” Review of Economic Theory and Policy, vol. 15, no. 1, 2020, pp. 1-12.

Czaputowicz, Jacek, and Anna Wojciuk. International Relations in Poland: 25 Years after the Transition to Democracy. Palgrave Macmillan, 2017.

Dursun-Özkanca, Oya. Turkey-West Relations: The Politics of Intra-alliance Opposition. Cambridge University Press, 2019.

Febrica, Senia. Maritime Security and Indonesia: Cooperation, Interests and Strategies. Routledge, 2017.

Ferreira, Maria. Empowerment and Fragility: Bio-politics and Ethics in International Relations and Strategic Studies. Cambridge Scholars Publishing, 2019.

Jackson, Richard, et al. Introduction to International Relations 7e: Theories and Approaches. Oxford University Press, 2018.

Lestaria, Diana, et al. “International Trade in the Covid-19 Outbreak: Is the Digital Economy Working?” Malaysian E Commerce Journal, vol. 4, no. 2, 2020, pp. 60-62.

Qin, Yaqing. A Relational Theory of World Politics. Cambridge University Press, 2018.

Ringmar, Erik. History of International Relations: A Non-European Perspective. Open Book Publishers, 2019.

Scribano, Adrián, et al. Neoliberalism in Multi-Disciplinary Perspective. Palgrave Macmillan, 2019.

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