Economy, therefore, is both integrated into the social field, as well as being regulated thereby. If we conceive of economy as a social institution, economic activity becomes an established interactive formality between individuals and nature, aiming to satisfy social needs. These needs are not exclusively physical or material, but also cultural or scientific. Social needs are shaped in social and historical contexts, and economy is engaged as far as the production and circulation of goods is required in order to satisfy these needs. Therefore, economy, as a substantial concept, does not only constitute a practical activity but also an institutional formality.

Liberal economic thought made the first attempt to distinguish economy from society. This attempt was based on the liberal idea that there is only a kind of human nature, homo economicus, who acts beyond the field of politics and power. The dissociation between economy and society results in economic liberation from every kind of political intervention. Classical and modern theoreticians vigorously defend the principles of economic liberalism- a system which, according to them, is so complete and coherent that has the ability to regulate itself and deal with every disorder by itself.

Classical economic liberalism, or laissez-faire liberalism, and market liberalism include the ideas of personal liberty, equality, human rationality, personal rights of property, protection of civil rights, free market, absence of state interference and the Gold standard which sets fiscal restraints to the government. The adherents of economic liberalism endorse the idea of minimum government, restriction of state’s interference in economy, liberation of private initiative, and denounce welfare state. More specifically, economic liberalism regards the state as an institution which is not able to regulate the market, as it generates contortions on a system that is perfectly self-optimizing.

One of the most substantial weaknesses of liberal economic thought is the absence of a crisis theory. The dominant economic theory has faith in the Efficient Market Hypothesis and rejects the possibility of crisis emergence, as “investors always behave rationally”. This tendency, however, should not surprise us because the classical economic system naturally excluded the prospect of crisis and, therefore, the relevant reasons that might have caused it. This point results in a further implication: there would not have been a therapy for crises, if theory rejected the possibility of its emergence.

The myth of market self-regulation and its ability to entirely control economic life are configured in the context of liberal economic thought. The occurrence, however, of economic crisis brings to the foreground inherent flaws in the belief that markets should be self-regulated. History itself provides us with examples which prove the failure of self-regulation to avoid crises: tulip mania in the Netherlands in 1637, the bursting of South Sea Bubble in Great Britain and Mississippi Bubble in France in 1720, the collapse of Viennese stock market in 1873, the Great Depression in 1929, the American stock market crisis in 1987 and Russian financial recession in 1998.

According to economist John Kenneth Galbraith, all economic crises share two common characteristics: first, every speculative episode includes a seeming innovation which is nothing more than a variant of an old design, new only in the brief and defective memory of the financial world. Second, the scrutiny of the previously much-praised financial instruments and practices is what happens after the inevitable crash.

Looking back, we observe that economic recession has the tendency to repeat itself and strike seemingly innovate certainties which reject crisis contingency. The main argument of this paper is that economic crisis reveals the existence of dialectic between certain periods during which hegemony shuttles from the ideology of market’s self-regulation to the periodic reintroduction of state intervention, a dialectic which peaks during economic recessions and runs through economic life. The dictations of self-regulation result in economic crises which automatically encounter the need for state intervention in order to regulate and reset the economy. When the economy recovers, we observe the appearance of a new ‘myth’ which imposes self-regulation as the indispensible factor of stable economic activity, and results in a new crisis, in turn requiring state intervention and guidelines.

The third part of the paper then turns to the International and presents how Arrighi, Cox and the Amsterdam School have applied Gramsci’s concept to this field. Relying again on the Quaderni, I will discuss a still relatively unexplored field in the literature: how Gramsci himself thought of international relations and hegemony within it. According to the reading proposed here, international relations in the ‘modern’ capitalist world are conceptualised dialectically and result as being characterised by rivalry amongst different states. Hegemony accrues to states (not classes). It is based on economic and military power of a given state relative to other states (likely to change over time) and describes a state’s degree of autonomy – hence also its ability to influence other states’ behaviour in different ways. Therefore, in my concluding remarks I will argue that Gramsci’s analysis of the International cannot be counted amongst Neogramscian analyses. For Gramsci presents an analysis closer to Lenin’s “Imperialism” and to a lesser extent to the realist school. Gramsci, it will be argued, provides a very rich and helpful framework for understanding International Political Economy.

Students of international relations or political economy in international relations often engage with the concept of hegemony as somehow related to the revolutionary and co founder of the Italian Communist Party, Antonio Gramsci. Despite the different meanings given to hegemony, Gramsci has always been identified as the thinker to have developed the concept.

The aim of this paper is then to look at Gramsci’s concept of hegemony more in depth and to asses whether its interpretation as put forward by scholars of international relations as well as its application to the international is convincing. The first part of the paper will outline how scholars of political economy of international relations which engaged with Gramsci more substantially, i.e. Arrighi and Cox, have understood Gramsci’s notion. The second part of the chapter (section two) will instead consider the Critical Edition of Gramsci’s Notebooks proposing, in important instances, a different reading compared to the above authors. Section three will on the one hand examine how Gramsci has been applied to the field of international relations and on the other hand look at how Gramsci himself conceived of International Relations and hegemony at the international level. Section four, my concluding remarks, will outline key differences between Gramsci and so-called Neogramscians and argue that Gramsci’s analysis, which comes closer to Lenin, is helpful for the understanding of International Poilitical Economy.

While looking at Gramscis’ Notebooks in the second section of the paper, the discussion will be informed by Anderson’s influential article “The Antinomies of Antonio Gramsci” (1976) as well as more recent publications on Gramsci, such as Alberto Burgio’s “Per Gramsci” (2007) Adam Morton’s “Unravelling Gramsci” (2007), Fontana’s chapter “Hegemony and Power in Gramsci” in “Hegemony: Studies in Coercion and Consensus” (2009), Peter Thomas’ “The Gramscian Moment” (2009). Differently from Arrrighi and Cox, as well as some of the above authors, the reading proposed here, will emphasise Gramsci’s characteristic Marxism (section 2.2) and how this influences Gramsci’s development of new concepts, among which, hegemony. Following the latter approach the subsequent sections will focus on the process of realisation of hegemony (2.3), define the concept and look at its relation to domination (2.4), outline where hegemony is located (2.4) and focus on how hegemony is exercised (2.5). In addition, section 2.6 will also outline how Gramsci theorises crises of hegemony and eventually ask whether Gramsci proposes implicitly a theory of hegemonic transitions (section 2.7). Based on the reading of Gramsci developed throughout section two, section 3.2 will look at how International Relations and hegemony at the international level are treated in the Quaderni.