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Political economy originally referred to the study of the economy of politics, and is still used in this sense by some economists.

In recent times it has been described also as a particular view of in the context of a human. There would be several competing schools whose definitions vary, but all would propose to describe the way political constraints affect the allocation of scarce resources - and frame the study of economics.

Classical political economy

The term political economy was first widely used in the 18th century by earlys such as the and. After refinement by (later reviewed by) and, it was universally used to describe what we now know as economics until around 1870 - so it properly describes classical economics:'s 1776 assumptions in "" laid a clear dividing line between economics proper and political economy: the state (following his) had to provide ",,, and a stable".

Although the definition of defense, infrastructure, justice and education have changed, this is still considered to be the best definition of the political economy of. Each of these functions can be said to be a collectively and legally-managed commons.

Neoclassical political economy

In 1870, the term economics was coined, and brought into common use by influential economists such as.

Marshall and most other economists used both terms as synonyms, with the term political economy gradually falling out of favour in the English speaking world during the twentieth century - partly due to its association with (see below). Use of the term underwent something of a revival during the 1960s when it was used increasingly by the radical economists of the Chicago School, to describe macroeconomic studies influenced by game-theory and rational-choice theory.

These, they believed, were fair descriptions of the way that mediates valuation of. Neoclassical economics avoids the general complexity of by assuming that these factors are defined by law, ethics, and customs that prevail in the economic. In effect, that political economy is just policy, and that economics is a science of the allocation of scarce resources, a definition which many see as too narrow, and have often challenged seriously. asks a pivotal question about the human origins in his essay "Is Fairness only about clear fitness signals?" It is a common theme among neoclassical economists that their study is a science, and does not depend on social or political relations but rather on human nature.

Marxist political economy - stability and fiat

However, a simultaneous track, extremely influential in and, studied class-relations and the relationship between and. strongly emphasized the role that plays in stabilizing or - imposing closure on transactions to favor a social class of power-holders. As the key concern of economics is enabling trade that helps an individual to survive without being alone against the forces of nature, this political economy has come to focus clearly on the role of government. But in recent years it has focused on civil society, ecology, families and other concerns. argue that in various forms is inherently destabilizing due to ecological or social damage - notably who argued in 1962 that it was "the most efficient" but also "doomed" because of its alienation of people from work.

Like other views of political economy, this analysis is concerned with the types or forms or styles of exist and how they relate via the media of - "" which may be backed by (as "), by commodity, by credit, or even by the of an. It does not, in general, accept "balanced growth" assumptions, is more concerned with externalized harms than two-player games, and assumes no rationality of economic choice. The assumption is that and as defined classically and neoclassically is not efficient in the broader political sense of helping the society allocate scarce resources.

This analysis has come to be known as in its political form.

Capitalism versus socialism

The two different sets of assumptions (neoclassical and Marxist) assume different things about stability of, but both grew up on classical assumptions, and neither challenged its basic - Marx's differs from Smith's only in asserting that labor is not a disposable commodity input.

The debates between these views have been titanic and helped spark the. Through most of the 20th century the views were felt to be somewhat irreconcilable. In modern terms, advocate for a higher valuation of and a general theory of, while advocate for a higher valuation of and a general theory of, in line with their Marxist and classical roots and the that prevails in each system.

The most extreme practitioners of the neoclassical economics tend to be the who advocate a totally liquid or or form of capitalism which permits trust, instructions, and infrastructure to find relative values in an open market of equal players. And, without limit, labor and social and natural capital as well.

Differences between economics and ecology

Critics of 'this' view hold that there is little equality between players due to historical inequities, e.g., and that has no voice in systems that are defined wholly by human commodity and contract relationships.

This is of course the difference between and its parallel in the non-human world - economics is intended and required to give humans an advantage over nature. However, we can't escape interdependence, as we are creatures who require air, water, food, and other natural services:

Adding an axiom employed by many that "economy is three fifths of ecology" -, emphasize that the commodity and services of an are poorly represented on this. Most consider thus undervalued.

Safety, fairness, closure

As the object of economic study, and a different theories of, have changed, so has the use of this term. Most generally, the term refers to the intersection of or relationship between and economics, and in this sense it is preferred by some other radical groups with widely differing groups such as,, and the.

As it assumes and thus justifies a systematic valuation of different types of, the term is regularly contested by various factions advocating different views of, of, and of. Its modern origins are traced to, 1817, and the extension of this and the competing analysis of, 1776, by into the concept of three - beginning a contest of "right" versus "left" views of nature, human, and tool value which continues to this very day.

Critique of economics

Some claim that the 20th century and its wars over economic systems and over property rights were entirely irrational due to shared failures of all three (classical, neoclassical, Marxist) systems. They seek a new political economy.

All three views, these critics argue, subordinate and by definition to some "progress" or "production" that is collectively and socially defined. And therefore imposed on the whole society. focus on the central role of nature and persons, portrayed as and, which are active and alive.

As in Marx's "means" versus "factors" distinction, these are viewed to subordinate, control or alter the other forms of in predictable ways - as the natural consequence of being alive with a body in a natural ecology. Views of life processes and what constitutes "moral necessity" within them is a field of its own -. A major driver of the critique of have been religious movements, who oppose among other things and the commodification of the lands of peoples who have long held them in common. These often argue that is undervalued, and that is a better way to maximize the utility.

Content of commons

All of this cast varying degrees of heat and light on the safety, fairness, and closure of transactions on the commons - politically managed resources, broadly shared. Advocates disagree over the importance of, land reform,, etc., but they tend to agree that overall global is reduced if there is no representation whatsoever for traditional societies, customs or ecologies.

For instance, most theories of would accept some degree of right to breath clean air or drink clean water or not have harms of pollution externalized on oneself by one's neighbors.

Attempts to represent such rights in a market system have led to negative to represent such things as the harms due to pollution. But these are not wholly functional nor in general satisfactory.

Proposed unsustainable positions of the three major theories

The applies the neoclassical political economy to "", Marxists see "" improving by joint action and education, while the ands have sought an outright alternative to the three main theories of political economy:

This has led to theories of, of,, and the negative. These rely on neoclassical assumptions with Marxist assumptions about stabilization, but fall short of being a new political economy in themselves. Some claim that a new, fourth, theory, is near at hand, as they find ways to integrate the and the which denies the rational-choice hypothesis.

The North-South debate and the right to live

However, some suggest that there would be no great trust in any of these academic or expert approaches.

There is a certain consensus, in the but not only, that the political balance of power between the advocates of all views above has historically strongly favored citizens of developed versus developing countries. This is often referred to as the or. Attempts to assign high valuations to scarce forms of capital in one country often lead to their arbitrage to another as or, in this view, further impoverishing the developing nations that open up to global markets.

Accordingly, the critiques the analysis of, claiming that "the IPCC was persuaded to include the results of a global cost-benefit analysis in its report". In this analysis every possible damage that might result from global warming, including human lives, must be given a dollar value. These values are calculated on the basis of asking people's "willingness to pay" to avoid the risk that damage. People in rich countries, it was assumed, would be willing to pay 15 times more than people in poor countries. In other words, the right to live could depend on respective income. The same ratio was applied to non-human life in each country, i.e forests, biodiversity etc.."

Risk of biased positions

This quote illustrates the basic conflict of any political economy - or indeed any justification for: the individuals arguing for it have their own lives, loyalties and localities, and associated bias that prevent a from which to assess the economic development process.

As views of,,,, and itself change, through what some call an, some people have argued that they "bubble up" to alter the framework of, thence and perhaps also to alter the basic ethics of the, e.g. as in the and.

In effect, the system is always biased, it is a question of how well bodies and ecologies survive it into the next generation. Some say that globalized economies are the only real choice. Others argue for regimes that keep the food and essential goods close to the consumer. These arguments have been the same throughout human history: centralization or decentralization?

Hypothesis for a global economy

It is investigated whether there could be any global political economy that all cultures would, could or should agree on. Some call the the first serious attempt to find one, based on experiences with. However, critics within the claim to prefer a more traditional fragmented national or that would continue linguistic and political traditions of host societies.

It seems likely and necessary that safety, fairness and closure issues as discussed in must come to some consensus if a 15x gap in valuation of developed vs. developing world lives is to be ultimately closed. Historically, people whose individual lives or life-sustaining natural ecoregions were undervalued in a particular political economy have tended to revolt and disrupt governance systems. The mainstream critique of a rational political economy, as writes in his book, is that:

The challenges we face converge, intertwine, and often remain largely beyond our understanding. Most of us suspect that the "experts" don't really know what's going on and that as a species we've released forces that are neither managed nor manageable.

Hypothesis for a local economy

The radical critiques, of course, vary and will continue to vary, as there is little agreement beyond some of the most basic of the terms above. Pending global agreement on terms in, and, it seems that contending to impose their views in a are the way that political economy issues will be settled among we humans.

An extreme view is thus that political economy does not exist, that the above is entirely subjective, and political economy cannot in practice be separated from - a common view among those pursuing, or extreme localism, wherein no commons would be acknowledged or managed globally.

External links

• Mill, contents, "The Principles of Political Economy"
• Ricardo, contents, "The Principles of Political Economy and Taxation", 1817
• "Reviving Local Economies", Wes Nickerson, 1996
• Thomas Homer-Dixon, "The Ingenuity Gap"
• IPEnet - International Political Economy network
• Journal of Political Economy
• Contributions to Political Economy

References

Adapted from Wikipedia article, "Political economy", http://www.wikipedia.org/w/wiki.phtml?title=Political_economy&oldid=161337 under the GNU Free Documentation License