A short thread on my article just published in Critical Historical Studies on the rise of the categories of "country risk" and "political risk" and the reordering of the world in the 1970s age of petrodollars. 1/

We're all familiar with the triumph of the nation-state paradigm after 1945--formal political equality combined with placement along a timeline of development measured in GDP, per capita income, etc. marching towards a supposed future moment of shared industrial modernity. 2/

But this timeline was scrambled in the 70s. The flood of petrodollars made credit cheap. New and poorer nations in Global South and East wanted in and financiers wanted to oblige--but they often knew little about these countries beyond often ignorant stereotypes. 3/

They feared expropriations of foreign-owned property, which had taken off in the early 1970s and were being sanctioned by the declarations of the New International Economic Order--so they began by making world maps of capital security 4/

In the late 70s, the financial press began creating league tables of what they called "country risk" using a term coined by Irving S. Friedman (first of the IMF, then of Citibank). This happened long before some of these countries were rated by Moody's and Standard & Poor's 5/

Interestingly, communist countries were ranked as especially safe bets for Euromarket lenders. As one journalist put it: "The assumption is that the governments in these countries have the police or military power to screw the earning capacity out of their subjects.” 6/

The Iranian Revolution-and the shock evaporation of $1b in assets--gave a boost to the field of political risk analysis. "Following the dramatic developments in Iran in 1979,” an analyst noted, “political factors were given greater weight in any risk assessment.” 7/

The hiring of political scientists and anthropologists by international lenders often produced quite loopy languages of "environmental scanning" as people searched for the edge on predicting the future 8/

This all carried through to the era of structural adjustment and the Third World Debt Crisis as the IMF took on the role of debt collector and "reforms" often targeted not only economic matters but governance and legal affairs too. 9/

The rise of political risk and country risk offers one example of many that, even in the era of supposed market fundamentalism, the limits of the market’s omniscience are well-recognized in the decision-making centers of financial and political power. https://www.journals.uchicago.edu/doi/10.1086/713524