Political Economy: Outlining a Field

Political economy has regained a central position among the academic subjects dealing with the polity and the economy. This development is not a mere reclaiming of intellectual traditions. It is also the expression of increasing awareness that the linkage between the economy and the polity is fundamental to the understanding of contemporary societies. This paper argues that the mutual relationship between the economy and the polity is rooted in the collective dimension of the provision and utilization of material resources. This collective dimension presupposes the coordination of human actions such as those entailed by the division of labour, which in turn requires multi-layered organizational arrangements and governance structures. The organization of this field depends on the way in which the objectives of different individuals and groups relate to one another, and on the constraints posed by the material sphere on the attainment of those objectives. Because the organization of the material sphere depends on the weights attached to the objectives of different individuals or groups, the provision and utilization of material resources are inherently political. At the same time, achievement of objectives requires complex arrangements concerning the material sphere, which poses internally structured constraints that also depend on the specific objectives being pursued. For example, the division of labour required for pursuing full employment may be different from that required for pursuing maximum growth. The objectives and constraints relevant to the material needs of the polity belong to multiple levels of analysis (micro, meso and macro) and relate to multiple levels of agency (say, individuals, productive sectors and states)