Convergence, Divergence, and Networks in the Age of Globalization a Social Network Analysis Approach to Ipe

National economies are not randomly distributed in the global economy, but embedded in complex networks of trade, financial flows, and international organizations. This research uses this insight to address the Convergence-Divergence debate by focusing on how network structures at the international level affect domestic policy outcomes. My thesis posits that economic forces of globalization impose differential impacts on national economies depending on a country’s relative positions in networks and the network channelling effects. Convergence and divergence in domestic economic policies can be considered as different ends of a continuum. Depending on countries’ network positions, their national economies are subject to differential levels of pressure to adapt to the forces of globalization. This results in national variations in a wide range of domestic policy outcomes. I present two hypotheses: first, the similarity of network positions induces convergence in domestic economic policies as a result of competitive pressure from other similar countries. Second, proximity in network positions facilitates communication and policy learning which in turn brings about domestic policy convergence among close “neighbors”. The empirical analysis applies a latent space model of network analysis and indicates that network position similarity in international portfolio investments and network position proximity in IGO networks have been important and consistent driving forces of policy convergence. In trade networks, on the other hand, I find weaker network effects on domestic policy outcomes.