The globalization of liberalization refers to the spread of liberal economic policies worldwide. This study examines how these policies diffuse internationally, influenced by both domestic and international factors. The authors argue that policy diffusion occurs through two main mechanisms: (1) changes in the benefits or costs of adopting a policy, and (2) the provision of information about the effects of a policy. They analyze three key areas of foreign economic policy: current account liberalization, capital account liberalization, and exchange rate unification. The findings suggest that policy transitions are influenced by international economic competition and the policies of a country's sociocultural peers. The study uses data from the International Monetary Fund (IMF) to measure policy transitions and employs spatial econometric methods to analyze the diffusion of policies. The results indicate that policy diffusion is influenced by both material and reputational payoffs, as well as new information from foreign models. The study also considers the role of cultural similarity in policy diffusion, suggesting that culturally similar countries are more likely to adopt similar policies. The authors conclude that domestic models of foreign economic policy making are insufficient and that international factors play a significant role in policy diffusion. The study highlights the importance of considering both domestic and international factors in understanding the spread of liberal economic policies.The globalization of liberalization refers to the spread of liberal economic policies worldwide. This study examines how these policies diffuse internationally, influenced by both domestic and international factors. The authors argue that policy diffusion occurs through two main mechanisms: (1) changes in the benefits or costs of adopting a policy, and (2) the provision of information about the effects of a policy. They analyze three key areas of foreign economic policy: current account liberalization, capital account liberalization, and exchange rate unification. The findings suggest that policy transitions are influenced by international economic competition and the policies of a country's sociocultural peers. The study uses data from the International Monetary Fund (IMF) to measure policy transitions and employs spatial econometric methods to analyze the diffusion of policies. The results indicate that policy diffusion is influenced by both material and reputational payoffs, as well as new information from foreign models. The study also considers the role of cultural similarity in policy diffusion, suggesting that culturally similar countries are more likely to adopt similar policies. The authors conclude that domestic models of foreign economic policy making are insufficient and that international factors play a significant role in policy diffusion. The study highlights the importance of considering both domestic and international factors in understanding the spread of liberal economic policies.