Stigma, hierarchy, and the Eurozone

Most attempts to understand the inter-state politics of the Eurozone with the insights of International Relations (IR) theory have examined the question of whether hegemonic stability theory explains the currency's political structure. The underlying social contract assumptions of this framework, this paper argues, exaggerate the amount of consent in the operation of hierarchy and the supposed benefits provided by leading states. Rather, the Eurozone's power hierarchy operates in a more diffuse, decentralized, and unintentional manner. Norms play a decisive role in these types of hierarchies, particularly as they influence financial markets which then pressure secondary states. The analysis makes the following contributions to the field of IR. First, it contributes to the literature that observes how hierarchies can operate without authority–in a decentralized, informal manner–via norms or benchmarks which stigmatize secondary states and pressure them to conform to the leading state. Second, it shows how market actors can be a key mediating variable between international hierarchy, norms, and state-behaviour. Third, it contributes to revealing the deep structures of international politics in a way that moves beyond the binary assumption of international orders as being either anarchical or authority-based.