The purpose of this study is to add to ongoing research in the field of international political economy, particularly to explanations of how economic policy is made. It responds to calls for less research regarding systemic theories, which currently dominate explanations of state behavior, and more research on how domestic variables affect a country's foreign economic policy. System centered approaches treat states as unitary decision makers and stress a country's relative position in the international system of states as the primary influence on its behavior. This research takes a 'politicized state-centric' approach, which contends that policy is created and destroyed at the state level, but is influenced by ideology, past experience, and various interest groups The study provides explanations for two time periods that can not be explained by the theory of hegemonic stability (currently the most popular systemic theory): the 1920s and 1930s in Great Britain and the 1960s in the United States. This study was narrowed to the steel industry because of its economic importance and the fact that both countries' policies toward steel reflect patterns in their general economic policies during the two key periods under discussion. Finally, the study contributes to cognitive theories on how a population's ideologies, values, beliefs, and available knowledge affect state behavior. Overall, the British case study gives insight into the American experience, and both studies have implications for the position of liberal states in a world of protectionism The conclusion finds many variables that affect the way states behave. These include: ideology and past policies; individualism; public opinion; past relationships between labor, industry, and government; the organization of industry, its economic importance, and past activities; interest group activity; party politics; the bureaucracy; the state of the economy; the political system; the will and capacity of a country to carry out policies; the complexity of the attempted policies; the country's position in the international system and its international economic and political concerns; the policies of other countries and their number and relative power; and the status of war and independence between states