Political economy

Political economy is the study of production and trade and their relations with law, custom and government; and with the distribution of national income and wealth. As a discipline, political economy originated in moral philosophy, in the 18th century, to explore the administration of states' wealth, with "political" signifying the Greek word polity and "economy" signifying the Greek word "okonomie" (household management). The earliest works of political economy are usually attributed to the British scholars Adam Smith, Thomas Malthus, and David Ricardo, although they were preceded by the work of the French physiocrats, such as François Quesnay (1694–1774) and Anne-Robert-Jacques Turgot (1727–1781).[1]

In the late 19th century, the term "economics" gradually began to replace the term "political economy" with the rise of mathematical modelling coinciding with the publication of an influential textbook by Alfred Marshall in 1890.[2] Earlier, William Stanley Jevons, a proponent of mathematical methods applied to the subject, advocated economics for brevity and with the hope of the term becoming "the recognised name of a science".[3][4] Citation measurement metrics from Google Ngram Viewer indicate that use of the term "economics" began to overshadow "political economy" around roughly 1910, becoming the preferred term for the discipline by 1920.[5] Today, the term "economics" usually refers to the narrow study of the economy absent other political and social considerations while the term "political economy" represents a distinct and competing approach.

Political economy, where it is not used as a synonym for economics, may refer to very different things. From an academic standpoint, the term may reference Marxian economics, applied public choice approaches emanating from the Chicago school and the Virginia school. In common parlance, "political economy" may simply refer to the advice given by economists to the government or public on general economic policy or on specific economic proposals developed by political scientists.[4] A rapidly growing mainstream literature from the 1970s has expanded beyond the model of economic policy in which planners maximize utility of a representative individual toward examining how political forces affect the choice of economic policies, especially as to distributional conflicts and political institutions.[6] It is available as a stand-alone area of study in certain colleges and universities.

Rousseau - Discours sur l'oeconomie politique, 1758 - 5884558
Jean-Jacques Rousseau, Discours sur l'oeconomie politique, 1758

Etymology

Originally, political economy meant the study of the conditions under which production or consumption within limited parameters was organized in nation-states. In that way, political economy expanded the emphasis of economics, which comes from the Greek oikos (meaning "home") and nomos (meaning "law" or "order"). Political economy was thus meant to express the laws of production of wealth at the state level, just as economics was the ordering of the home. The phrase économie politique (translated in English as "political economy") first appeared in France in 1615 with the well-known book by Antoine de Montchrétien, Traité de l’economie politique. The French physiocrats were the first exponents of political economy, although the intellectual responses of Adam Smith, John Stuart Mill, David Ricardo, Henry George and Karl Marx to the physiocrats generally receives much greater attention.[7] The world's first professorship in political economy was established in 1754 at the University of Naples Federico II in southern Italy. The Neapolitan philosopher Antonio Genovesi was the first tenured professor. In 1763, Joseph von Sonnenfels was appointed a Political Economy chair at the University of Vienna, Austria. Thomas Malthus, in 1805, became England's first professor of political economy, at the East India Company College, Haileybury, Hertfordshire. In its contemporary meaning, political economy refers to different yet related approaches to studying economic and related behaviours, ranging from the combination of economics with other fields to the use of different, fundamental assumptions that challenge earlier economic assumptions:

Current approaches

Keohane small
Robert Keohane, international relations theorist

Political economy most commonly refers to interdisciplinary studies drawing upon economics, sociology and political science in explaining how political institutions, the political environment, and the economic systemcapitalist, socialist, communist, or mixed—influence each other.[8] The Journal of Economic Literature classification codes associate political economy with three sub-areas: (1) the role of government and/or class and power relationships in resource allocation for each type of economic system;[9] (2) international political economy, which studies the economic impacts of international relations;[10] and (3) economic models of political or exploitative class processes.[11] Much of the political economy approach is derived from public choice theory on the one hand and radical political economics on the other hand, both dating from the 1960s.

Public choice theory is a microfoundations theory that is closely intertwined with political economy. Both approaches model voters, politicians and bureaucrats as behaving in mainly self-interested ways, in contrast to a view, ascribed to earlier mainstream economists, of government officials trying to maximize individual utilities from some kind of social welfare function.[12] As such, economists and political scientists often associate political economy with approaches using rational-choice assumptions,[13] especially in game theory[14] and in examining phenomena beyond economics' standard remit, such as government failure and complex decision making in which context the term "positive political economy" is common.[15] Other "traditional" topics include analysis of such public policy issues as economic regulation,[16] monopoly, rent-seeking, market protection,[17] institutional corruption[18] and distributional politics.[19] Empirical analysis includes the influence of elections on the choice of economic policy, determinants and forecasting models of electoral outcomes, the political business cycles,[20] central-bank independence and the politics of excessive deficits.[21]

A more recent focus has been on modeling economic policy and political institutions as to interactions between agents and economic and political institutions,[22] including the seeming discrepancy of economic policy and economist's recommendations through the lens of transaction costs.[23] From the mid-1990s, the field has expanded, in part aided by new cross-national data sets that allow tests of hypotheses on comparative economic systems and institutions.[24] Topics have included the breakup of nations,[25] the origins and rate of change of political institutions in relation to economic growth,[26] development,[27] financial markets and regulation,[28] the importance of institutions,[29] backwardness,[30] reform[31] and transition economies,[32] the role of culture, ethnicity and gender in explaining economic outcomes,[6] macroeconomic policy,[33] the environment,[34] fairness[35] and the relation of constitutions to economic policy, theoretical[36] and empirical.[37]

Other important landmarks in the development of political economy include:

  • New political economy which may treat economic ideologies as the phenomenon to explain, per the traditions of Marxian political economy. Thus, Charles S. Maier suggests that a political economy approach "interrogates economic doctrines to disclose their sociological and political premises.... in sum, [it] regards economic ideas and behavior not as frameworks for analysis, but as beliefs and actions that must themselves be explained".[38] This approach informs Andrew Gamble's The Free Economy and the Strong State (Palgrave Macmillan, 1988), and Colin Hay's The Political Economy of New Labour (Manchester University Press, 1999). It also informs much work published in New Political Economy, an international journal founded by Sheffield University scholars in 1996.[39]
  • International political economy (IPE) an interdisciplinary field comprising approaches to the actions of various actors. In the United States, these approaches are associated with the journal International Organization, which in the 1970s became the leading journal of IPE under the editorship of Robert Keohane, Peter J. Katzenstein and Stephen Krasner. They are also associated with the journal The Review of International Political Economy. There also is a more critical school of IPE, inspired by thinkers such as Antonio Gramsci and Karl Polanyi; two major figures are Matthew Watson and Robert W. Cox.[40]
  • The use of a political economy approach by anthropologists, sociologists, and geographers used in reference to the regimes of politics or economic values that emerge primarily at the level of states or regional governance, but also within smaller social groups and social networks. Because these regimes influence and are influenced by the organization of both social and economic capital, the analysis of dimensions lacking a standard economic value (e.g. the political economy of language, of gender, or of religion) often draws on concepts used in Marxian critiques of capital. Such approaches expand on neo-Marxian scholarship related to development and underdevelopment postulated by André Gunder Frank and Immanuel Wallerstein.
  • Historians have employed political economy to explore the ways in the past that persons and groups with common economic interests have used politics to effect changes beneficial to their interests.[41]
  • Political economy and law is a recent attempt within legal scholarship to engage explicitly with political economy literature. In the 1920s and 1930s, legal realists (e.g. Robert Hale) and intellectuals (e.g. John Commons) engaged themes related to political economy. In the second half of the 20th century, lawyers associated with the Chicago School incorporated certain intellectual traditions from economics. However, since the crisis in 2007 legal scholars especially related to international law, have turned to more explicitly engage with the debates, methodology and various themes within political economy texts.[42][43]
  • Thomas Piketty's approach and call to action which advocated for the re-introduction of political consideration and political science knowledge more generally into the discipline of economics as a way of improving the robustness of the discipline and remedying its shortcomings, which had become clear following the 2008 financial crisis.[44]
  • In 2010, the only Department of Political Economy in the United Kingdom formally established at King's College London. The rationale for this academic unit was that "the disciplines of Politics and Economics are inextricably linked", and that it was "not possible to properly understand political processes without exploring the economic context in which politics operates".[45]
  • In 2017, the Political Economy UK Group (abbreviated PolEconUK) was established as a research consortium in the field of political economy. It hosts an annual conference and counts among its member institutions Oxford, Cambridge, King's College London and the London School of Economics.[46]

Related disciplines

Because political economy is not a unified discipline, there are studies using the term that overlap in subject matter, but have radically different perspectives:[47]

  • Politics studies power relations and their relationship to achieving desired ends.
  • Philosophy rigorously assesses and studies a set of beliefs and their applicability to reality.
  • Economics studies the distribution of resources so that the material wants of a society are satisfied; enhance societal well-being.
  • Sociology studies the effects of persons' involvement in society as members of groups and how that changes their ability to function. Many sociologists start from a perspective of production-determining relation from Karl Marx. Marx's theories on the subject of political economy are contained in his book Das Kapital.
  • Anthropology studies political economy by investigating regimes of political and economic value that condition tacit aspects of sociocultural practices (e.g. the pejorative use of pseudo-Spanish expressions in the U.S. entertainment media) by means of broader historical, political and sociological processes. Analyses of structural features of transnational processes focus on the interactions between the world capitalist system and local cultures.
  • Archaeology attempts to reconstruct past political economies by examining the material evidence for administrative strategies to control and mobilize resources.[48] This evidence may include architecture, animal remains, evidence for craft workshops, evidence for feasting and ritual, evidence for the import or export of prestige goods, or evidence for food storage.
  • Psychology is the fulcrum on which political economy exerts its force in studying decision making (not only in prices), but as the field of study whose assumptions model political economy.
  • History documents change, often using it to argue political economy; some historical works take political economy as the narrative's frame.
  • Ecology deals with political economy because human activity has the greatest effect upon the environment, its central concern being the environment's suitability for human activity. The ecological effects of economic activity spur research upon changing market economy incentives. Additionally and more recently, ecological theory has been used to examine economic systems as similar systems of interacting species (e.g., firms).[49]
  • Cultural studies examines social class, production, labor, race, gender and sex.
  • Communications examines the institutional aspects of media and telecommunication systems. As the area of study focusing on aspects of human communication, it pays particular attention to the relationships between owners, labor, consumers, advertisers, structures of production and the state and the power relationships embedded in these relationships.

See also

Notes

  1. ^ Steiner (2003), pp. 61–62
  2. ^ Marshall, Alfred. (1890) Principles of Economics.
  3. ^ Jevons, W. Stanley. The Theory of Political Economy, 1879, 2nd ed. p. xiv.
  4. ^ a b Groenwegen, Peter. (1987 [2008]). "'political economy' and 'economics'", The New Palgrave: A Dictionary of Economics, v. 3, pp. 905–06. [Pp. 904–07.]
  5. ^ Mark Robbins (2016) "Why we need political economy," Policy Options, [1]
  6. ^ a b Alesina, Alberto F. (2007:3) "Political Economy," NBER Reporter, pp. 1–5. Abstract-linked-footnotes version.
  7. ^ "What is Political Economy?". Political Economy, Athabasca University. Retrieved 2017-06-15.
  8. ^ Weingast, Barry R., and Donald Wittman, ed., 2008. The Oxford Handbook of Political Economy. Oxford UP. Description Archived 2013-01-25 at the Wayback Machine and preview.
  9. ^ At JEL: P as in JEL Classification Codes Guide, drilled to at each economic-system link.
    For example:
       • Brandt, Loren, and Thomas G. Rawski (2008). "Chinese economic reforms," The New Palgrave Dictionary of Economics, 2nd Edition. Abstract.
       • Helsley, Robert W. (2008). "urban political economy," The New Palgrave Dictionary of Economics, 2nd Edition. Abstract.
  10. ^ At JEL: F5 as drilled to in JEL Classification Codes Guide.
    For example:
       • Gilpin, Robert (2001), Global Political Economy: Understanding the International Economic Order, Princeton. Description and ch. 1, " The New Global Economic Order" link.
       • Mitra, Devashish (2008). "trade policy, political economy of," The New Palgrave Dictionary of Economics, 2nd Edition. Abstract.
  11. ^ At JEL: D72 and JEL: D74 with context for its usage in JEL Classification Codes Guide, drilled to at JEL: D7.
  12. ^ Tullock, Gordon ([1987] 2008). "public choice," The New Palgrave Dictionary of Economics. Abstract.
       • Arrow, Kenneth J. (1963). Social Choice and Individual Values, 2nd ed., ch. VIII, sect. 2, The Social Decision Process, pp. 106–08.
  13. ^ Lohmann, Susanne (2008). "rational choice and political science," The New Palgrave Dictionary of Economics, 2nd Edition. Abstract.
  14. ^ Shubik, Martin (1981). "Game Theory Models and Methods in Political Economy," in K. Arrow and M. Intriligator, ed., Handbook of Mathematical Economics, Elsevier, v. 1, pp. 285-330.
       • _____ (1984). A Game-Theoretic Approach to Political Economy. MIT Press. Description Archived 2011-06-29 at the Wayback Machine and review extract.
       • _____ (1999). Political Economy, Oligopoly and Experimental Games: The Selected Essays of Martin Shubik, v. 1, Edward Elgar. Description Archived 2012-05-24 at the Wayback Machine and contents of Part I, Political Economy.
       • Peter C. Ordeshook (1990). "The Emerging Discipline of Political Economy," ch. 1 in Perspectives on Positive Political Economy, Cambridge, pp. 9–30.
       • _____ (1986). Game Theory and Political Theory, Cambridge. Description and preview.
  15. ^ Alt, James E.; Shepsle, Kenneth (eds.) (1990), Perspectives on Positive Political Economy (Cambridge [UK]; New York: Cambridge University Press). Description and content links and preview.
  16. ^ Rose, N. L. (2001). "Regulation, Political Economy of," International Encyclopedia of the Social & Behavioral Sciences, pp. 12967–12970. Abstract.
  17. ^ Krueger, Anne O. (1974). "The Political Economy of the Rent-Seeking Society," American Economic Review, 64(3), p. 291–303.
  18. ^ • Bose, Niloy. "corruption and economic growth," The New Palgrave Dictionary of Economics Online, 2nd Edition, 2010. Abstract.
       • Rose-Ackerman, Susan (2008). "bribery," The New Palgrave Dictionary of Economics, 2nd Edition. Abstract.
  19. ^ Becker, Gary S. (1983). "A Theory of Competition among Pressure Groups for Political Influence," Quarterly Journal of Economics, 98(3), pp. 371–400.
       • Weingast, Barry R., Kenneth A. Shepsle, and Christopher Johnsen (1981). "The Political Economy of Benefits and Costs: A Neoclassical Approach to Distributive Politics," Journal of Political Economy, 89(4), pp. 642–664.
       • Breyer, Friedrich (1994). "The Political Economy of Intergenerational Redistribution," European Journal of Political Economy, 10(1), pp. 61–84. Abstract.
       • Williamson, Oliver E. (1995). "The Politics and Economics of Redistribution and Inefficiency," Greek Economic Review, December, 17, pp. 115–136, reprinted in Williamson (1996), The Mechanisms of Governance, Oxford University Press, ch. 8, pp. 195–218.
       • Krusell, Per, and José-Víctor Ríos-Rull (1999). "On the Size of U.S. Government: Political Economy in the Neoclassical Growth Model," American Economic Review, 89(5), pp. 1156-1181.
       • Galasso, Vincenzo, and Paola Profeta (2002). "The Political Economy of Social Security: A Survey," European Journal of Political Economy, 18(1), pp. 1–29.
  20. ^ • Drazen, Allan (2008). "Political business cycles," The New Palgrave Dictionary of Economics, 2nd Edition. Abstract.
       • Nordhaus, William D. (1989). "Alternative Approaches to the Political Business Cycle," Brookings Papers on Economic Activity, (2), pp. 1-68.
  21. ^ Buchanan, James M. (2008). "public debt," The New Palgrave Dictionary of Economics, 2nd Edition. Abstract.
       • Alesina, Alberto, and Roberto Perotti (1995). "The Political Economy of Budget Deficits," IMF Staff Papers, 42(1), pp. 1-31.
  22. ^ Timothy, Besley (2007). Principled Agents?: The Political Economy of Good Government, Oxford. Description.
       • _____ and Torsten Persson (2008). "political institutions, economic approaches to," The New Palgrave Dictionary of Economics, 2nd Edition. Abstract.
       • North, Douglass C. (1986). "The New Institutional Economics," Journal of Institutional and Theoretical Economics, 142(1), pp. 230-237.
       • _____ (1990). Institutions, Institutional Change and Economic Performance, in the Political Economy of Institutions and Decisions series. Cambridge. Description and preview.
       • Ostrom, Elinor (1990). Governing the Commons: The Evolution of Institutions for Collective Action. Cambridge University Press. Description and preview links. ISBN 9780521405997.
       • _____ (2010). "Beyond Markets and States: Polycentric Governance of Complex Economic Systems," American Economic Review, 100(3), pp. 641-72 Archived 2013-11-05 at the Wayback Machine.
  23. ^ Dixit, Avinash (1996). The Making of Economic Policy: A Transaction Cost Politics Perspective. MIT Press. Description and chapter-preview links. Review-excerpt link.
  24. ^ Beck, Thorsten et al. (2001). "New Tools in Comparative Political Economy: The Database of Political Institutions," World Bank Economic Review,15(1), pp. 165-176.
  25. ^ Bolton, Patrick, and Gérard Roland (1997). "The Breakup of Nations: A Political Economy Analysis," Quarterly Journal of Economics, 112(4), pp. 1057–1090.
  26. ^ Alesina, Alberto, and Roberto Perotti (1994). "The Political Economy of Growth: A Critical Survey of the Recent Literature," World Bank Economic Review, 8(3), pp. 351–371.
  27. ^ Keefer, Philip (2004). "What Does Political Economy Tell Us about Economic Development and Vice Versa?" Annual Review of Political Science, 7, pp. 247–72. PDF.
  28. ^ Perotti, Enrico (2014). "The Political Economy of Finance", in "Capitalism and Society" Vol. 9, No. 1, Article 1 [2]
  29. ^ "Chang, H. J. (2002). Breaking the Mould – An Institutionalist Political Economy Alternative to the Neo-Liberal Theory of the Market and State", in "Cambridge Journal of Economics", 26(5), [3]
  30. ^ Acemoglu, Daron, and James A. Robinson (2006). "Economic Backwardness in Political Perspective," American Political Science Review, 100(1), pp. 115–131.
  31. ^ • Mukand, Sharun W. (2008). "policy reform, political economy of," The New Palgrave Dictionary of Economics, 2nd Edition. Abstract.
       • Sturzenegger, Federico, and Mariano Tommasi (1998). The Polítical Economy of Reform, MIT Press. Description Archived 2012-10-11 at the Wayback Machine and chapter-preview links.
  32. ^ Roland, Gérard (2002), "The Political Economy of Transition," Journal of Economic Perspectives, 16(1), pp. 29–50.
       • _____ (2000). Transition and Economics: Politics, Markets, and Firms, MIT Press. Description and preview.
       • Manor, James (1999). The Political Economy of Democratic Decentralization, The World Bank. ISBN 9780821344705. Description.
  33. ^ Drazen, Allan (2000). Political Economy in Macroeconomics, Princeton. Description & ch. 1-preview link. Archived 2010-12-07 at the Wayback Machine, and review extract.
  34. ^ • Dietz, Simon, Jonathan Michie, and Christine Oughton (2011). Political Economy of the Environment An Interdisciplinary Approach, Routledge. Description and preview.
       • Banzhaf, H. Spencer, ed. (2012). The Political Economy of Environmental Justice Stanford U.P. Description and contents links.
       • Gleeson, Brendan, and Nicholas Low (1998). Justice, Society and Nature An Exploration of Political Ecology, Routledge. Description Archived 2013-05-10 at the Wayback Machine and preview.
       • John S. Dryzek, 2000. Rational Ecology: Environment and Political Economy, Blackburn Press. B&N description.
       • Barry, John 2001. "Justice, Nature and Political Economy," Economy and Society, 30(3), pp. 381–394.
       • Boyce, James K. (2002). The Political Economy of the Environment, Edward Elgar. Description.
  35. ^ • Zajac, Edward E. (1996). Political Economy of Fairness, MIT Press Description and chapter-preview links.
       • Thurow, Lester C. (1980). The Zero-sum Society: Distribution and the Possibilities For Economic Change, Penguin. Description and preview.
  36. ^ Persson, Torsten, and Guido Tabellini (2000). Political Economics: Explaining Economic Policy, MIT Press. Review extract, description and chapter-preview links.
       • Laffont, Jean-Jacques (2000). Incentives and Political Economy, Oxford. Description.
       • Acemoglu, Daron (2003). "Why Not a Political Coase Theorem? Social Conflict, Commitment, and Politics," Journal of Comparative Economics, 31(4), pp. 620–652.
  37. ^ Persson, Torsten, and Guido Tabellini (2003). The Economic Effects Of Constitutions, Munich Lectures in Economics. MIT Press. Description and preview, and review extract.
  38. ^ Mayer, Charles S. (1987). In Search of Stability: Explorations in Historical Political Economy, Cambridge University Press, Cambridge, pp.3–6. Description and scrollable preview. Cambridge.
  39. ^ cf: Baker, David (2006). "The political economy of fascism: Myth or reality, or myth and reality?" Archived 2011-06-23 at the Wayback Machine, New Political Economy, 11(2), pp. 227–250.
  40. ^ Cohen, Benjamin J. "The transatlantic divide: Why are American and British IPE so different?", Review of International Political Economy, Vol. 14, No. 2, May 2007.
  41. ^ McCoy, Drew R. "The Elusive Republic: Political Economy in Jeffersonian America", Chapel Hill, University of North Carolina.
  42. ^ Kennedy, David (2013). "Law and the Political Economy of the World" (PDF). Leiden Journal of International Law. Retrieved December 24, 2015.
  43. ^ Haskell, John D. (2015). Research Handbook on Political Economy and Law. Edward Elgar. ISBN 978 1 78100 534 7.
  44. ^ Capital in the Twenty-First Century, Harvard University Press, 2014, ISBN 978-0674430006
  45. ^ https://www.kcl.ac.uk/political-economy/about/index
  46. ^ https://www.poleconuk.net/
  47. ^ "political economy". Encyclopedia Britannica. Retrieved 2017-06-15.
  48. ^ Hirth, Kenneth G. 1996. Political Economy and Archaeology: Perspectives on Exchange and Production. Journal of Archaeological Research, 4(3):203–239.
  49. ^ May, Robert M.; Levin, Simon A.; Sugihara, George (February 21, 2008). "Ecology for bankers". Nature. 451 (451): 893–895. doi:10.1038/451893a. PMID 18288170.

References

  • Baran, Paul A. (1957). The Political Economy of Growth. Monthly Review Press, New York. Review extrract.
  • Commons, John R. (1934 [1986]). Institutional Economics: Its Place in Political Economy, Macmillan. Description and preview.
  • Leroux, Robert (2011), Political Economy and Liberalism in France : The Contributions of Frédéric Bastiat, London, Routledge.
  • Maggi, Giovanni, and Andrés Rodríguez-Clare (2007). "A Political-Economy Theory of Trade Agreements," American Economic Review, 97(4), pp. 1374-1406.
  • O'Hara, Phillip Anthony, ed. (1999). Encyclopedia of Political Economy, 2 v. Routledge. 2003 review links.
  • Pressman, Steven, Interactions in Political Economy: Malvern After Ten Years Routledge, 1996
  • Rausser, Gordon, Swinnen, Johan, and Zusman, Pinhas (2011). Political Power and Economic Policy. Cambridge: Cambridge U.P.
  • Winch, Donald (1996). Riches and Poverty : An Intellectual History of Political Economy in Britain, 1750–1834 Cambridge: Cambridge U.P.
  • Winch, Donald (1973). "The Emergence of Economics as a Science, 1750–1870." In: The Fontana Economic History of Europe, Vol. 3. London: Collins/Fontana.
  • Quadagno, Jill. “Aging and The Life Course: An Introduction to Social Gerontology / Edition 6.” Barnes & Noble, www.barnesandnoble.com/w/aging-and-the-life-course-jill-quadagno/1100262260.
  • F., David. “Utopia and the Critique of Political Economy.” Journal of Australian Political Economy, Australian Political Economy Movement, 1 Jan. 2017, www.questia.com/library/journal/1G1-501598977/utopia-and-the-critique-of-political-economy.

Journals

External links

A Contribution to the Critique of Political Economy

A Contribution to the Critique of Political Economy (German: Zur Kritik der Politischen Ökonomie) is a book by Karl Marx, first published in 1859. The book is mainly an analysis of capitalism and quantity theory of money, achieved by critiquing the writings of the leading theoretical exponents of capitalism at that time: these were the political economists, nowadays often referred to as the classical economists; Adam Smith (1723–90) and David Ricardo (1772–1823) are the foremost representatives of the genre.

Classical economics

Classical economics or classical political economy is a school of thought in economics that flourished, primarily in Britain, in the late 18th and early-to-mid 19th century. Its main thinkers are held to be Adam Smith, Jean-Baptiste Say, David Ricardo, Thomas Robert Malthus, and John Stuart Mill. These economists produced a theory of market economies as largely self-regulating systems, governed by natural laws of production and exchange (famously captured by Adam Smith's metaphor of the invisible hand).

Adam Smith's The Wealth of Nations in 1776 is usually considered to mark the beginning of classical economics. The fundamental message in Smith's book was that the wealth of any nation was determined not by the gold in the monarch's coffers, but by its national income. This income was in turn based on the labor of its inhabitants, organized efficiently by the division of labour and the use of accumulated capital, which became one of classical economics' central concepts.In terms of economic policy, the classical economists were pragmatic liberals, advocating the freedom of the market, though they saw a role for the state in providing for the common good. Smith acknowledged that there were areas where the market is not the best way to serve the common interest, and he took it as a given that the greater proportion of the costs supporting the common good should be borne by those best able to afford them. He warned repeatedly of the dangers of monopoly, and stressed the importance of competition. In terms of international trade, the classical economists were advocates of free trade, which distinguishes them from their mercantilist predecessors, who advocated protectionism.

The designation of Smith, Ricardo and some earlier economists as 'classical' is due to Karl Marx, to distinguish the 'greats' of economic theory from their 'vulgar' successors. There is some debate about what is covered by the term "classical economics", particularly when dealing with the period from 1830–75, and how classical economics relates to neoclassical economics.

Das Kapital

Das Kapital, also called Capital. A Critique of Political Economy (German: Das Kapital. Kritik der politischen Oekonomie, pronounced [das kapiˈtaːl kʁɪˈtiːk deːɐ poˈliːtɪʃən økonomˈiː]; 1867–1883) by Karl Marx is a foundational theoretical text in materialist philosophy, economics and politics. Marx aimed to reveal the economic patterns underpinning the capitalist mode of production in contrast to classical political economists such as Adam Smith, Jean-Baptiste Say, David Ricardo and John Stuart Mill. While Marx did not live to publish the planned second and third parts, they were both completed from his notes and published after his death by his colleague Friedrich Engels. Das Kapital is the most cited book in the social sciences published before 1950.

Economics

Economics () is the social science that studies the production, distribution, and consumption of goods and services.Economics focuses on the behaviour and interactions of economic agents and how economies work. Microeconomics analyzes basic elements in the economy, including individual agents and markets, their interactions, and the outcomes of interactions. Individual agents may include, for example, households, firms, buyers, and sellers. Macroeconomics analyzes the entire economy (meaning aggregated production, consumption, saving, and investment) and issues affecting it, including unemployment of resources (labour, capital, and land), inflation, economic growth, and the public policies that address these issues (monetary, fiscal, and other policies). See glossary of economics.

Other broad distinctions within economics include those between positive economics, describing "what is", and normative economics, advocating "what ought to be"; between economic theory and applied economics; between rational and behavioural economics; and between mainstream economics and heterodox economics.Economic analysis can be applied throughout society, in business, finance, health care, and government. Economic analysis is sometimes also applied to such diverse subjects as crime, education, the family, law, politics, religion, social institutions, war, science, and the environment.

Heterodox economics

Heterodoxy is a term that may be used in contrast with orthodoxy in schools of economic thought or methodologies, that may be beyond neoclassical economics. Heterodoxy is an umbrella term that can cover various schools of thought or theories. These might for example include institutional, evolutionary, Georgist, Austrian, feminist, social, post-Keynesian (not to be confused with New Keynesian), ecological, Marxian, socialist and anarchist economics, among others.Economics may be called orthodox or conventional economics by its critics. Alternatively, mainstream economics deals with the "rationality–individualism–equilibrium nexus" and heterodox economics is more "radical" in dealing with the "institutions–history–social structure nexus". Many economists dismiss heterodox economics as "fringe" and "irrelevant", with little or no influence on the vast majority of academic mainstream economists in the English-speaking world.

A recent review documented several prominent groups of heterodox economists since at least the 1990s as working together with a resulting increase in coherence across different constituents. Along these lines, the International Confederation of Associations for Pluralism in Economics (ICAPE) does not define "heterodox economics" and has avoided defining its scope. ICAPE defines its mission as "promoting pluralism in economics."

In defining a common ground in the "critical commentary," one writer described fellow heterodox economists as trying to do three things: (1) identify shared ideas that generate a pattern of heterodox critique across topics and chapters of introductory macro texts; (2) give special attention to ideas that link methodological differences to policy differences; and (3) characterize the common ground in ways that permit distinct paradigms to develop common differences with textbook economics in different ways.One study suggests four key factors as important to the study of economics by self-identified heterodox economists: history, natural systems, uncertainty, and power.

Historical school of economics

The historical school of economics was an approach to academic economics and to public administration that emerged in the 19th century in Germany, and held sway there until well into the 20th century. The professors involved compiled massive economic histories of Germany and Europe. Numerous Americans were their students. The school was opposed by theoretical economists. Prominent leaders included Gustav von Schmoller (1838–1917), and Max Weber (1864–1920) in Germany, and Joseph Schumpeter (1883–1950) in the United States.

International political economy

International political economy (IPE), also known as global political economy (GPE), refers to either economics or an interdisciplinary academic discipline that analyzes economics and international relations. When it is used to refer to the latter, it usually focuses on political economy and economics, although it may also draw on a few other distinct academic schools, notably political science, also sociology, history, and cultural studies. IPE is most closely linked to the fields of macroeconomics, international business, international development and development economics.

IPE scholars are at the center of the debate and research surrounding globalization, international trade, international finance, financial crises, microeconomics, macroeconomics, development economics, (poverty and the role of institutions in development), global markets, political risk, multi-state cooperation in solving trans-border economic problems, and the structural balance of power between and among states and institutions.

Journal of Political Economy

The Journal of Political Economy is a bimonthly peer-reviewed academic journal published by the University of Chicago Press. It covers both theoretical and empirical economics. It was established in 1892 by James Laurence Laughlin.Its current editor-in-chief is Harald Uhlig (University of Chicago).

Kevin Carson

Kevin Carson is an American social theorist and mutualist known for his left-libertarianism. He is a Senior Fellow and Karl Hess Chair in Social Theory at the Center for a Stateless Society. Carson's Studies in Mutualist Political Economy aims to revive interest in mutualism, synthesizing Austrian economics with the labor theory of value by incorporating both subjectivism and time preference. His work has been addressed by anarcho-capitalist economist Walter Block and his Center for a Stateless Society colleague, the philosopher Roderick T. Long.

Manufacturing Consent

Manufacturing Consent: The Political Economy of the Mass Media is a 1988 book by Edward S. Herman and Noam Chomsky, in which the authors propose that the mass communication media of the U.S. "are effective and powerful ideological institutions that carry out a system-supportive propaganda function, by reliance on market forces, internalized assumptions, and self-censorship, and without overt coercion", by means of the propaganda model of communication. The title derives from the phrase "the manufacture of consent," employed in the book Public Opinion (1922), by Walter Lippmann (1889–1974).The book was revised 20 years after its first publication to take account of developments such as the fall of the Soviet Union. There has been debate about how the Internet has changed the public’s access to information since 1988.

Marxian economics

Marxian economics, or the Marxian school of economics, is a heterodox school of economic thought. Its foundations can be traced back to the critique of classical political economy in the research by Karl Marx and Friedrich Engels. Marxian economics comprises several different theories and includes multiple schools of thought, which are sometimes opposed to each other, and in many cases Marxian analysis is used to complement or supplement other economic approaches. Because one does not necessarily have to be politically Marxist to be economically Marxian, the two adjectives coexist in usage rather than being synonymous. They share a semantic field while also allowing connotative and denotative differences.

Marxian economics concerns itself variously with the analysis of crisis in capitalism, the role and distribution of the surplus product and surplus value in various types of economic systems, the nature and origin of economic value, the impact of class and class struggle on economic and political processes, and the process of economic evolution.

Marxian economics, particularly in academia, is distinguished from Marxism as a political ideology as well as the normative aspects of Marxist thought, with the view that Marx's original approach to understanding economics and economic development is intellectually independent from Marx's own advocacy of revolutionary socialism. Marxian economists do not lean entirely upon the works of Marx and other widely known Marxists, but draw from a range of Marxist and non-Marxist sources.Although the Marxian school is considered heterodox, ideas that have come out of Marxian economics have contributed to mainstream understanding of the global economy; certain concepts of Marxian economics, especially those related to capital accumulation and the business cycle, such as creative destruction, have been fitted for use in capitalist systems.Marx's magnum opus on political economy was Das Kapital (Capital: A Critique of Political Economy) in three volumes, of which only the first volume was published in his lifetime (1867); the others were published by Friedrich Engels from Marx's notes. One of Marx's early works, Critique of Political Economy, was mostly incorporated into Das Kapital, especially the beginning of volume 1. Marx's notes made in preparation for writing Das Kapital were published in 1939 under the title Grundrisse.

Political Economy Research Institute

The Political Economy Research Institute (PERI) is an institute at the University of Massachusetts Amherst which, according to its mission statement, "...promotes human and ecological well-being through our original research.

Political economy in anthropology

Political Economy in anthropology is the application of the theories and methods of historical materialism to the traditional concerns of anthropology, including, but not limited to, non-capitalist societies. Political Economy introduced questions of history and colonialism to ahistorical anthropological theories of social structure and culture. Most anthropologists moved away from modes of production analysis typical of structural Marxism, and focused instead on the complex historical relations of class, culture and hegemony in regions undergoing complex colonial and capitalist transitions in the emerging world system.Political Economy was introduced in American anthropology primarily through the support of Julian Steward, a student of Kroeber. Steward’s research interests centered on “subsistence” — the dynamic interaction of man, environment, technology, social structure, and the organization of work. This emphasis on subsistence and production - as opposed to exchange - is what distinguishes the Political Economy approach. Steward's most theoretically productive years were from 1946-1953, while teaching at Columbia University. At this time, Columbia saw an influx of World War II veterans who were attending school thanks to the GI Bill. Steward quickly developed a coterie of students who would go on to develop Political Economy as a distinct approach in anthropology, including Sidney Mintz, Eric Wolf, Eleanor Leacock, Roy Rappaport, Stanley Diamond, Robert Manners, Morton Fried, Robert F. Murphy, and influenced other scholars such as Elman Service, Marvin Harris and June Nash. Many of these students participated in the Puerto Rico Project, a large-scale group research study that focused on modernization in Puerto Rico.Three main areas of interest rapidly developed. The first of these areas was concerned with the "pre-capitalist" societies that were subject to evolutionary "tribal" stereotypes. Sahlins' work on hunter-gatherers as the "original affluent society" did much to dissipate that image. The second area was concerned with the vast majority of the world's population at the time, the peasantry, many of whom were involved in complex revolutionary wars such as in Vietnam. The third area was on colonialism, imperialism, and the creation of the capitalist world-system.More recently, these political economists have more directly addressed issues of industrial (and post-industrial) capitalism around the world.

Private property

Private property is a legal designation for the ownership of property by non-governmental legal entities. Private property is distinguishable from public property, which is owned by a state entity; and from collective (or cooperative) property, which is owned by a group of non-governmental entities. Private property can be either personal property (consumption goods) or capital goods. Private property is a legal concept defined and enforced by a country's political system.

Ronen Palan

Ronen Palan (born 21 March 1957) is an Israeli-born economist and Professor of International Political Economy in the Department of International Politics at the City University London. He has many books and articles on the political economy of the state, globalisation and state strategies, and evolutionary approaches to the study of international relations. Ronen Palan was of the founding editors of the Review of International Political Economy. Palan's major empirical work is the area of offshore financial centres and tax havens. Palan has argued that offshore finance "is certainly not the sole cause for the decline of the nation-state, but it must be seen as an important contributing factor to the decline".In January 2016, Palan acted as an advisor to the BBC's documentary, Britain’s Trillion Pound Paradise – Inside Cayman.. In May 2017, Palan also featured in the documentary, "The Spider's Web: Britain's Second Empire" on the U.K.'s relationships with tax havens.As a student, Palan attended the London School of Economics, and subsequently worked at Newcastle University and the University of Sussex before joining Birmingham University in 2007. Palan has authored and edited a number of books, including Global Political Economy: Contemporary Theories (edited, Routledge, 2000), The Offshore World: Sovereign Markets, Virtual Places, and Nomad Millionaires (Cornell University Press, 2003), The Imagined Economies of Globalisation (with Angus Cameron, Sage, 2004) and Tax Havens: How Globalization Really Works (with Richard Murphy, Christian Chavagneux, Cornell University Press, 2010).Palan is married and has two sons.

Thomas Robert Malthus

Thomas Robert Malthus (; 13 February 1766 – 23 December 1834) was an English cleric and scholar, influential in the fields of political economy and demography.In his 1798 book An Essay on the Principle of Population, Malthus observed that an increase in a nation's food production improved the well-being of the populace, but the improvement was temporary because it led to population growth, which in turn restored the original per capita production level. In other words, humans had a propensity to utilize abundance for population growth rather than for maintaining a high standard of living, a view that has become known as the "Malthusian trap" or the "Malthusian spectre". Populations had a tendency to grow until the lower class suffered hardship, want and greater susceptibility to famine and disease, a view that is sometimes referred to as a Malthusian catastrophe. Malthus wrote in opposition to the popular view in 18th-century Europe that saw society as improving and in principle as perfectible. He saw population growth as being inevitable whenever conditions improved, thereby precluding real progress towards a utopian society: "The power of population is indefinitely greater than the power in the earth to produce subsistence for man". As an Anglican cleric, Malthus saw this situation as divinely imposed to teach virtuous behaviour. Malthus wrote:

That the increase of population is necessarily limited by the means of subsistence,That population does invariably increase when the means of subsistence increase, and,That the superior power of population is repressed by moral restraint, vice and misery.

Malthus criticized the Poor Laws for leading to inflation rather than improving the well-being of the poor. He supported taxes on grain imports (the Corn Laws), because food security was more important than maximizing wealth. His views became influential, and controversial, across economic, political, social and scientific thought. Pioneers of evolutionary biology read him, notably Charles Darwin and Alfred Russel Wallace. He remains a much-debated writer.

Malthus himself used only his middle name, Robert.

Use value

Use value (German: Gebrauchswert) or value in use is a concept in classical political economy and Marxian economics. It refers to the tangible features of a commodity (a tradeable object) which can satisfy some human requirement, want or need, or which serves a useful purpose. In Karl Marx's critique of political economy, any product has a labor-value and a use-value, and if it is traded as a commodity in markets, it additionally has an exchange value, most often expressed as a money-price.Marx acknowledges that commodities being traded also have a general utility, implied by the fact that people want them, but he argues that this by itself tells us nothing about the specific character of the economy in which they are produced and sold.

Virginia school of political economy

The Virginia School of political economy is a school of economic thought originating in universities of Virginia (University of Virginia, Virginia Tech, and George Mason University) in the 1950s and 1960s, mainly focusing on public choice theory, constitutional economics, and law and economics.

William Stanley Jevons

William Stanley Jevons FRS (; 1 September 1835 – 13 August 1882) was an English economist and logician.

Irving Fisher described Jevons's book A General Mathematical Theory of Political Economy (1862) as the start of the mathematical method in economics. It made the case that economics as a science concerned with quantities is necessarily mathematical. In so doing, it expounded upon the "final" (marginal) utility theory of value. Jevons's work, along with similar discoveries made by Carl Menger in Vienna (1871) and by Léon Walras in Switzerland (1874), marked the opening of a new period in the history of economic thought. Jevons's contribution to the marginal revolution in economics in the late 19th century established his reputation as a leading political economist and logician of the time.

Jevons broke off his studies of the natural sciences in London in 1854 to work as an assayer in Sydney, where he acquired an interest in political economy. Returning to the UK in 1859, he published General Mathematical Theory of Political Economy in 1862, outlining the marginal utility theory of value, and A Serious Fall in the Value of Gold in 1863. For Jevons, the utility or value to a consumer of an additional unit of a product is inversely related to the number of units of that product he already owns, at least beyond some critical quantity.

Jevons received public recognition for his work on The Coal Question (1865), in which he called attention to the gradual exhaustion of Britain's coal supplies and also put forth the view that increases in energy production efficiency leads to more, not less, consumption. This view is known today as the Jevons paradox, named after him. Due to this particular work, Jevons is regarded today as the first economist of some standing to develop an 'ecological' perspective on the economy. The most important of his works on logic and scientific methods is his Principles of Science (1874), as well as The Theory of Political Economy (1871) and The State in Relation to Labour (1882). Among his inventions was the logic piano, a mechanical computer.

Schools
Related fields and sub-fields
Basic concepts
Policies
Models
Macroeconomists
Lists
Terminology
Organizations
and policies
Political economy
Regional organizations
Exports by product
Primary
Interdisciplinary
Other categorizations

This page is based on a Wikipedia article written by authors (here).
Text is available under the CC BY-SA 3.0 license; additional terms may apply.
Images, videos and audio are available under their respective licenses.