Political Economy Definition

Economic liberals, in particular, would limit the role of the state in the economy in order to let market forces decide political and social outcomes. While this global health crisis continues to evolve, it can be useful to look to past pandemics to better understand how to respond today. Britannica Explains In these videos, Britannica explains a variety of topics and answers frequently asked questions. His most famous work, “An Inquiry into the Nature and Causes of the Wealth of Nations” (or “The Wealth of Nations”) helped shape classical economic theory.

Political economists attempting to understand domestic macroeconomic policy often study the influence of political institutions (e.g., legislatures, executives, and judiciaries) and the implementation of public policy by bureaucratic agencies. The influence of political and societal actors (e.g., interest groups, political parties, churches, elections, and the media) and ideologies (e.g., democracy, fascism, or communism) also is gauged. Comparative analysis also considers the extent to which international political and economic conditions increasingly blur the line between domestic and foreign policies in different countries. For example, in many countries trade policy no longer reflects strictly domestic objectives but also takes into account the trade policies of other governments and the directives of international financial institutions.

This body of research led to Dr Monastiriotis’ appointment to the Minimum Wage Committee in 2018 and influenced directly the government decision to raise the MW in Greece by 10.8% in February 2019. The main concern of political economy is to determine the relationship between governments and individuals, and how public policy affects society. The term political economy refers to a branch of social sciences that focuses on relationships between individuals, governments, and public policy. It is also used to describe the policies set by governments that affect their nations’ economies.

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Cold War rivalry between the Soviet Union and the United States (1945–91). Analyses initially focused largely on international security but later came to include economic security and the role of market actors—including multinational corporations, international banks, cartels (e.g., OPEC), and international organizations (e.g., the IMF)—in national and international security strategies. International https://www.wikipedia.org/ grew in importance as a result of various dramatic international economic events, such as the collapse of the Bretton Woods international monetary system in 1971 and the oil crisis of 1973–74.