What Is Political Economy

What is Political economy? * No widespread agreement of what; but understood in three ways- those who see PE as an interaction of existing disciplines, those who see it as a set of questions, and those who see it as a method of analysis: Interaction of existing disciplines: * Starting point is that as capitalism develops politics and econ becoming increasingly interdependent. * Not only interdependence of domestic pol and national econ but also international pol and global econ (4 disciplines) * Criticised by Marxists, because focuses on how the national state manages economic problems Radical/Heterdox IPE (those who see it as a question); * PE is an area of study, a set of questions, a series of assumptions- who has power? What’s the source of power? PE as a method: To understand society, you need to understand economics foundation, then you understand politics, ideas, and laws; “What is it about economic power that produces society”? Four approaches: * Political economics/and or politics of the economic policy-making (separate disciplines; influence of politics on the economy and of the economy on politics) * International political economy- Susan Strange (who gets what in the global context- politics, economics, security and social values) * Classical political economy- forerunner of modern social science (Smith WN 1776) * Critique of classical political economy- Karl Marx Political economics: Strict separation between the disciplines of politics and economics: * Politics- the art and science of government * Econ- rational utility maximising behaviour in conditions of scarcity * Field of pol economics studies role of politicians in making econ policy and the effect of econ performance on the electability of government. * Main contribution – theory of political business cycle - in run up to election govts favour policies which enhance popularity with voters * Politics of