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International economic power (the ability to shape rules of global economic conduct) needs to be understood in terms of the interactions between rule‐makers and rule‐takers in the global economy. Attempts to reshape development paradigms through interventions during financial crisis have been highly significant for the domestic political economy of the developing world. In the 1980s and early 1990s, the primary question was how much countries would liberalize in response to financial crisis. Reactions to the crises of the late 1990s in Asia and Latin America were more varied. This article explores domestic political responses to crises in both regions in the 1980s and late 1990s. It argues that countries are finding it increasingly difficult to trump domestic political pressure for change with arguments about technocratic necessity. Popular pressure is pushing governments into new experiments in economic nationalism, not a radical rejection of global economic integration, but a reshaping of relationships in an attempt to secure national interests and, in some cases, to devote more resources to welfare. Experiments to date are modest, but could presage more significant change in the future.

Political protest in Europe and the problematic politics surrounding bank recapitalization in the US have raised growing concerns about the rise of populist politics. Populist politics is problematic in its search for simplistic solutions to complex problems, its disdain for institutions and its political ambiguity. Nonetheless, the rise of populist mobilization also points to genuine concerns about the functioning of democracy. The politics of financial regulation has been dominated by a narrow, utilitarian and technocratic mode of policy‐making that has tried to limit public debate, favouring an expert discourse which privileges questions of efficiency over questions of distribution. This article explores the distributional issues at stake in banking recapitalization (particularly questions about the returns governments receive for their investment) and regulation (through an exploration of the financialization literature). It argues that, while populist appeals to ‘the people’ are too ambiguous to be helpful, given the complexity of the interests at stake in financial regulation, there is a need for a wider and more democratic debate about financial regulation that pays greater attention to distributional issues. Populist mobilization can create pressure for debate, even if it presents few solutions. As a result, we should be wary of moves to shift too much regulation to the international level where populist mobilization is less effective.

Twenty-five years ago, theoretical reflection on International Relations (IR) was dominated by three broad discourses. In the United States the behavioural revolution of the 1950s and 1960s had helped to create a field that was heavily influenced by various assumptions allegedly derived from the natural sciences. Of course, variety existed within the behaviourist camp. Some preferred the heavily quantitative approach that had become especially influential in the 1960s, while others were exploring the burgeoning literature of rational and public choice, derived from the game theoretic approaches pioneered at the RAND corporation. Perhaps the most influential theoretical voice of the late 1970s, Kenneth Waltz, chose neither; instead he developed his Theory of International Politics around an austere conception of parsimony and systems derived from his reading in contemporary philosophy of science.