IR Analysis of a Global Fiscal Reset

Sovereign debt is a central feature of the modern international system. My proposed research topic will study how global politics would change if all sovereign debt were suddenly erased. I will be using major International Relations theories to analyze behavior politics, state interaction, cooperation, and power distribution. This paper will review the existing literature through perspectives of realism, constructivism, and liberalism, to analyze a global debt reset. This is important because debt shapes power in the international system. Treaties and communities have been created to guide states to financial and economic balance. Would those continue to serve a purpose in a new financially fluid world? How will foreign policy adapt to these changes? What are the different effects of developing countries versus big powers? Economic independence shapes the way states interact with one another in trade, institutions, cooperation, etc. These are some questions I propose to emphasize the importance of sovereign debt on international affairs. Debt functions as a material constraint and a source of structural power. I will use market forces, international power dynamics, and political pressure as a baseline for my research. There are no enforceable mechanisms because the global financial system depends on debt as a core asset to the world economy. This research will however serve as an indicator of the importance of debt and economic well-being on the global economy.