*Political economy*

__________-_

What is Political economy?

-Introduction

-Origin
-First use of Political economy was in 1615 by Antonie de Montchrestein in his book Treaties on
political economy (1615)

-Two greek words- Politea+ oikonomia. Where politea means Social organization and
Oikonomia means Household. All together it refers to “the laws of social organizations”

History
The contemporary political economy was formerly known as Economy in the 18th - mid 19th
century

Leading lights
* Adam Smith (1723-1790): Father of political economy. Adam Smith published "*The Wealth of
Nations" in 1776.* His work laid the foundation for classical economics and emphasized the role
of free markets, division of labor, and the concept of the invisible hand.

* David Ricardo (1722-1822): Introduced the theory of comparative advantage and analyzed
international trade, which explains the benefits of international trade. In his book "*Principles of
Political Economy and Taxation," published in 1817,* he argued that countries should specialize
in producing goods in which they have a comparative advantage and engage in trade to
maximize overall welfare.

* Karl Marx (1818-1883): Developed the framework of Marxism, 1 Critique of Capitalism: Marx's
most notable contribution is his comprehensive critique of capitalism. In his seminal work, "Das
Kapital," Marx analyzed the capitalist mode of production and exposed its inherent
contradictions and exploitative nature.

* He argued that under capitalism, workers create value through their labor, but capitalists
extract surplus value by paying workers less than the value they produce. This theory is central
to Marx's critique of capitalist exploitation.

* Historical Materialism: Marx introduced the concept of historical materialism, which is a

framework for understanding societal development and change. According to Marx, social and
economic systems evolve through a series of historical stages driven by class struggle. Using
the 6 stages of human development
* Class Struggle: Marx emphasized the importance of class struggle in shaping history and
driving social change. He argued that the capitalist system inherently creates conflicts between
the bourgeoisie (capitalist class) and the proletariat (working class). Marx believed that the
contradictions and antagonisms within capitalism would eventually lead to a proletarian
revolution, resulting in the establishment of a classless communist society.

* Dialectic materialism- a method of trying to understand reality using the 3 tenets -

1. Unity and conflict of opposite,
2. Law of Negation,
3. Law of quantity to quality

* John Maynard Keynes (1883) Keynesian economics, named after John Maynard Keynes,
emerged in response to the Great Depression of the 1930s. Keynes challenged classical
economic theory and argued for government intervention to address economic downturns.

* Claude Ake (1939-1996) Claude Ake, a prominent Nigerian political economist and a
Neomarxist, made significant contributions to the field of political economy, particularly in the
context of Africa. Ake's work focused on understanding the challenges of development,
governance, and democratization in African countries. His works include a political economy of
African (1981)

*Politics/ economy meaning *

Politics is the Authoritative allocation of value and can also be referred to as power/ state
While Economy is about value and creation of value. It can be referred to as wealth/ market
The relationship between politics and the economy refers to how political decisions, policies,
and institutions influence economic activities and outcomes. Political factors, such as
government regulations, taxation policies, trade agreements, and social welfare programs, can
significantly impact economic growth, income distribution, and market dynamics.
Adam smith- prudent management of the national wealth

Gilpin- interaction of market and powerful actors

JS Mills- a science that teaches a nation how to become rich

Perspectives

Political economy encompasses multiple perspectives and approaches to analyzing the

interplay between politics and the economy. Some of the prominent perspectives include

liberal / vulgar/ Bourgeoisie political economy,

Marxist/ Radical political economy, and political economy as a methodology.

These perspectives offer different lenses to understand the complex dynamics of power,
interests, and economic systems.
Liberal- (Bourgeoisie, vulgar) here political economy is seen as activity that has to do with
survival of the fittest and elimination of the weakest

Marxist- (Radical) here Political economy is seen as activity that shows how how the states
scarce resources are being managed using the instrument of class.

Method- here political economy is seen as the social science discipline that serve as a tool for
analysis or as a comprehensive and multi -disciplinary approach to understanding relationship
between individual and his society as well as the market and the state using diverse tools

Features

Political economy incorporates various features that distinguish it from traditional economics or
political science.

These features include

1. analyzing power relations

2. understanding economic and political institutions
3.. studying social and historical contexts
4. examining the influence of ideology and values on economic decision-making.

Importance

1. Understanding the Interplay: Political economy helps us understand the complex interplay
between politics and the economy. It provides insights into how political decisions and
institutions shape economic systems, and how economic forces, in turn, influence political
processes. This understanding is vital for effective policymaking and fostering sustainable
economic development.

2. Policy Analysis and Design: Political economy analysis informs policy analysis and design. It
helps policymakers and practitioners assess the potential consequences, trade-offs, and
unintended effects of different policies on various stakeholders. By considering the political and
economic context, policymakers can develop more effective and inclusive policies.

3. Exploring Inequality and Social Justice: Political economy sheds light on issues of economic
inequality and social justice. It examines how power relations, institutions, and policies
contribute to unequal distribution of resources and opportunities. By understanding these
dynamics, policymakers and researchers can develop strategies to address inequality and
promote social justice.
4. Economic Development and Growth: Political economy plays a crucial role in understanding
the factors that contribute to economic development and growth. By analyzing the interaction
between political institutions, policies, and economic systems, policymakers can identify
strategies to promote inclusive growth, enhance productivity, and reduce poverty.

5. Democracy and Governance: Political economy provides insights into the relationship
between democracy, governance, and economic outcomes. It examines how democratic
institutions, transparency, accountability, and citizen participation impact economic performance
and social well-being. This understanding is important for strengthening democratic governance
and ensuring responsible economic management.

Conclusion
----------------------------

5 perspectives/ theories
Mercantilism
Classical
Neoclassical
Marxist
Neo marxist

Political economy encompasses various perspectives and theories that seek to understand and
analyze the interaction between politics, society, and the economy. Here's a brief overview of
the perspectives you mentioned:

Mercantilism: Mercantilism is an economic theory that was prevalent during the 16th to 18th
centuries. It emphasizes the accumulation of wealth and power through trade. Mercantilists
believed in state intervention and protectionist policies to promote exports, restrict imports, and
maintain a favorable balance of trade. They viewed wealth as finite and aimed to increase a
nation's wealth through colonial expansion and control of resources.

Classical: Classical refers to the economic theories developed by economists such as Adam
Smith, David Ricardo, and John Stuart Mill in the 18th and 19th centuries. Classical economists
emphasized the role of free markets, division of labor, and the pursuit of self-interest in driving
economic growth. They argued for minimal government interference in the economy and
believed that markets would naturally reach equilibrium.

Neoclassical: Neoclassical is a mainstream economic theory developed in the late 19th and
early 20th centuries. It emphasizes market competition, individual rationality, and the efficiency
of free markets. Neoclassical economists believe that individuals and firms maximize their utility
or profits, and that markets reach equilibrium through the interaction of supply and demand.
They advocate for limited government intervention and emphasize the role of prices in allocating
resources. JM Keynes
Marxist: Marxist is based on the theories of Karl Marx and Friedrich Engels, developed in the
mid-19th century. It provides a critical analysis of capitalism, focusing on the exploitation of
labor and the class struggle between the bourgeoisie (capitalist class) and the proletariat
(working class). Marxists argue that capitalism inherently leads to social inequality and
instability. They advocate for the abolition of private ownership of the means of production and
the establishment of a socialist or communist society.

Neomarxist: Neomarxism is a contemporary school of thought that builds upon Marxist ideas but
incorporates additional perspectives. Neomarxists emphasize the importance of power relations,
social structures, and cultural factors in understanding economic systems. They often explore
concepts such as imperialism, hegemony, and the role of ideology in maintaining capitalist
systems. Neomarxists critique the concentration of economic power and advocate for social and
political transformation.
It's important to note that these perspectives represent different approaches to understanding
political economy and have varying interpretations and critiques of capitalism and economic
systems. Claude Ake, Bade Onimode

DIALECTICAL TRIAD, which consists of a *thesis* (an established idea or social order), an
*antithesis* (a contradictory idea or social order), and a *synthesis* (a new idea or social order
that emerges through the resolution of the conflict between thesis and antithesis). It is also
important to note that this New idea that emerges can also be made into a thesis by the
establishment of an anti thesis which will be contradicting this new idea. That is the dialectic
triad can also be seen as a circular process rather than linear

Political Economy Analysis (PEA) is an approach used to understand and analyze the
interactions between political and economic factors in a particular context. It seeks to examine
how politics and economics intersect, influence each other, and shape development outcomes,
policies, and decision-making processes.

4 level of analysis:

Global- world

Country- Nations (Nigeria, Ghana etc)

Sectoral- sectors within a nation (Financial, Transportation, Communication etc)

Project/ problem driven- Problems or issues in a nation (insecurity, terrorism, ethnic conflict etc)

PEA examines the distribution and exercise of power among different actors and groups, as well
as their interests and incentives. It looks at how these factors influence policy choices, resource
allocation, and decision-making processes. It looks at Agencies, class struggle, power relations
etc
three specific categories that are often discussed in the context of class analysis. These
categories are:
1. Comprador Bourgeoisie: The term "comprador bourgeoisie" is commonly used in the context
of colonial or neocolonial societies. It refers to a segment of the bourgeoisie that acts as
intermediaries between foreign capital and the domestic economy. Comprador bourgeoisie
typically collaborates with foreign investors, often representing the interests of multinational
corporations. They facilitate the extraction of resources, exploit local labor, and benefit from the
economic relationships established with foreign powers.
2. National Bourgeoisie: The national bourgeoisie refers to a segment of the bourgeoisie that is
tied to the nation-state and is primarily focused on domestic economic activities. This category
of bourgeoisie often seeks to protect and promote national economic interests, industries, and
markets. They may have close ties to the government and actively participate in domestic
industrialization and economic development.
3. Petty Bourgeoisie: The petty bourgeoisie, also known as the small bourgeoisie, refers to
individuals or small business owners who own and operate their own means of production but
have limited capital and often work independently or with a small number of employees. This
category includes small-scale entrepreneurs, self-employed professionals, small business
owners, and artisans. The petty bourgeoisie typically occupies a position between the working
class and the bourgeoisie and may face economic uncertainties and challenges.

1. Lumpen Proletariat: The lumpen proletariat refers to a marginalized and economically

dispossessed section of society. This category includes individuals who are unemployed,
underemployed, or engaged in informal and irregular work. The term "lumpen" comes from the
German word "Lumpen" meaning rags, suggesting a state of extreme poverty and social
degradation. The lumpen proletariat often faces social exclusion, lacks stable employment, and
may be involved in criminal activities, begging, or other forms of survival strategies. Marxists
generally viewed the lumpen proletariat as being outside the traditional class struggle and less
likely to engage in revolutionary movements due to their precarious position.
2. Peasant Proletariat: The peasant proletariat refers to rural workers or peasants who are
employed as agricultural laborers but do not own or control the land they work on. They are
often landless or have very small landholdings. Peasant proletarians typically face exploitation,
low wages, and limited access to resources. They may work on large estates or as hired labor
for wealthier landowners. In agrarian societies, the peasant proletariat played a significant role
in the struggle for land reform and peasant movements seeking improved working and living
conditions.

------------------

1. Necessary Labor/Product: Necessary labor refers to the amount of time and effort that
workers must expend to produce goods and services required for their own subsistence. It
represents the labor needed to reproduce their own livelihood. Necessary product refers to the
portion of the goods or services produced that is required for the sustenance of the workers
themselves.
2. Surplus Labor/Product: Surplus labor is the labor performed by workers beyond what is
necessary for their own subsistence. It refers to the additional time and effort that workers
contribute to the production process, which goes beyond the production of their own
necessities. Surplus product refers to the portion of the goods or services produced that
exceeds what is necessary for the survival of the workers.

3. Labor Power: Labor power is the capacity or ability of individuals to perform work. It is the
potential labor that workers possess and can offer for sale to employers. Labor power is a
commodity that workers exchange in the labor market in return for wages or a means of
subsistence.

4. Object of Labor: The object of labor refers to the material or physical things upon which labor
is performed to produce goods or services. It encompasses the raw materials, natural
resources, or inputs that are transformed through labor into a final product.

5. Means or Instrument of Labor: The means or instrument of labor refers to the tools,
machinery, equipment, and technology used in the production process. It includes the physical
and technical means that workers utilize to transform the object of labor into finished goods or
services.

6. Means of Production: The means of production encompass the broader concept that includes
both the means or instruments of labor and the object of labor. It refers to the physical and non-
human inputs and resources used in the production process, including tools, machinery,
equipment, land, natural resources, and infrastructure.

7. Productive Forces: Productive forces refer to the combination of labor power and the means
of production within a society. They encompass the physical and technical capacities available
for production, including the skills, knowledge, technology, and resources that contribute to the
production of goods and services.

8. Social Relations of Production: Social relations of production refer to the relationships and
interactions among individuals involved in the production process. It includes the ownership and
control of the means of production, the division of labor, the organization of work, and the
distribution of the produced goods and services. The social relations of production shape the
power dynamics and class relations within a society.

9. Economic System or Modes of Production: An economic system or mode of production refers

to the way in which the means of production and social relations of production are organized
within a society. It encompasses the specific economic arrangements, property relations, and
social structures that define how goods and services are produced, distributed, and consumed.
Examples of economic systems include capitalism, socialism, feudalism, and communism.

10. Socio-Economic Formation: A socio-economic formation, also known as a social formation,

refers to a specific configuration of social, economic, and political structures within a society at a
particular historical period. It includes the economic system, class relations, cultural norms,
political institutions, and other factors that shape the overall socio-economic order
---------------

The political economy of African crises is a complex and multifaceted. It involves examining the
interplay between political and economic factors that contribute to various crises in African
countries.

1. Colonial Legacy: Many African countries have experienced long histories of colonialism,
which have had lasting effects on their political, economic, and social structures. The legacy of
colonial rule, including arbitrary borders, extractive economic systems, and limited institutional
capacity, has influenced the challenges and vulnerabilities faced by African nations.

2. Governance and Political Instability: Weak governance, corruption, and political instability are
significant factors contributing to crises in many African countries. Authoritarian regimes, lack of
transparency, limited accountability, and political exclusion can undermine institutions, erode
public trust, and create an environment prone to conflict and economic mismanagement.

3. Economic Factors: Economic challenges, such as poverty, inequality, and limited economic
diversification, play a role in African crises. Overreliance on commodity exports, volatile global
commodity prices, inadequate infrastructure, and limited access to finance can hinder
sustainable development and contribute to economic instability.

4.External Factors: External influences, including global economic dynamics, geopolitical

interests, and international aid and trade policies, can impact African countries' vulnerability to
crises. Unequal trade relations, debt burdens, and conditionalities attached to international
financial assistance can shape the economic landscape and limit policy space.

5. Natural Resource Management: The management of natural resources, such as oil, gas,
minerals, and land, can be a source of both opportunity and challenges. Weak governance and
corruption in the extractive industries can lead to resource mismanagement, environmental
degradation, social tensions, and conflicts over resource control.

6. Socioeconomic Factors: Socioeconomic factors, including population growth, urbanization,

food insecurity, and inadequate access to basic services such as healthcare and education, can
contribute to crises. Inadequate social safety nets, inequality, and marginalization can
exacerbate social tensions and economic instability.

------------------/---/

productive forces (means of production + labour)

Means of production (object of labour + Instrument/ Means of labor)

Object of labour (Raw materials, land, woods etc.)

Means of labor (tools and instrument eg machine etc)

Labour (physical, psychological, mental and intellectual ability)

-------------------------

Communal mode of production- (hunter -gatherer society)

labor power- physical (hunting), mental and skill
Means of labor- spears and arrow
Object of labor- wood and land

Slavery mode of production-

Class: slaves and slave owners
labor power- physical, mental and skill
Means of labor- hoes, cutlass etc
Object of labor- wood, metal and land

The feudal mode of production- (Agrarian society)

Class: lords and serfs
labor power- physical, mental and skill
Means of labor- hoes, cutlass, plough etc
Object of labor- land

Capitalist mode of production- (industrial society)

Class: Bourgeoisie and proletariat
labor power- physical, mental, intellectual and skill
Means of labor- technologies, Factories
Object of labor- Raw materials and Natural resourses

Socialist mode of production-

Class: state managers and proletariat
labor power- physical, mental, intellectual and skill
Means of labor- technologies, Factories
Object of labor- Raw materials and Natural resourses

Communist mode of production-

Class: ???
labor power- physical, mental, intellectual and skill
Means of labor- technologies, Factories
Object of labor- Raw materials and Natural resourses

---------------

terms "base" and "superstructure" are used to describe the relationship between the economic
base of a society and its ideological, political, and cultural superstructure. However, if you're
looking for
---------------

base/ subsructure/ infrastructure

&

Superstructure