Political economy

Political economy is the branch of social science that studies the production and distribution of the material needs and wealth of human societies. It is not directly concerned with the technical side of production, but with the relations between people in the process of production and exchange. According to the Great Soviet Encyclopedia the term was coined by the French mercantilist A. de Montchrétien in his 1615 Treatise on Political Economy. For its early exponents, who also included William Petty (1623-1687) and Adam Smith (1723-1790), political economy was a branch of ethics. For Karl Marx (1818-1883), who developed political economy in an anti-capitalist direction, the ethical and social aspects of the subject were paramount. He saw political economy as being historically grounded, and dependent on class relations. With the growth of positivism in the 19th century, however, political economy, like sociology, came to be seen as a branch of science and its political content was downplayed. Largely as a reaction against Marx and the Ricardian socialists, who had turned political economy against its pro-capitalist founders, the "political" in "political economy" was dropped and pro-capitalists in this field now usually refer to it simply as "economics". The term "political economy" still tends to be preferred, however, by those who consider the social and historical part of the subject to be indispensable, and who in many cases regard pro-capitalist economic theory as being fraught with reification and false consciousness.

The early British political economists contributed much to the development of Hegel's views in that they showed the relation between human thinking and social relations and how these social relations developed through specific historical stages related to the progress of techniques of production.

After the completion of his earliest investigations, Marx concentrated the majority of his theoretical work on the critique of political economy because Marx saw that the work of the political economists most clearly exhibited the ideological forms which dominated bourgeois society: explaining the science of economics through the perspective of the large and small scale capitalist, not through the perspective of the working class.

The simple fact that production is social is repeatedly neglected by bourgeois economists who delight in making false abstractions, as when, for example, they construct from the behaviour of an imaginary Robinson Crusoe on a desert island economic theories which are assumed to be applicable to any and every economic system. This was equally true of the bourgeois economists in Marx’s day, and in criticism of them he wrote:

Man is a Zoon politikon [political animal] in the most literal sense: he is not only a social animal, but an animal that can be individualised only within society. Production by a solitary individual outside society – a rare event, which might occur when a civilised person who has already absorbed the dynamic social forces is accidentally cast into the wilderness – is just as preposterous as the development of speech without individuals who live together and talk to one another.

Another common error of bourgeois economists is their neglect of change and development. Marxist theory pays particular attention to social change and development and to changes in the laws of social development themselves. Political economy seeks to explain economic systems, that is, the relations in which men, and classes, stand to one another in the getting of their living; it is, in Lenin’s words, "the science dealing with the development of historical systems of social production".

It is necessary to find out not only how it works at one point of time, but also how it came into being, how and why it changes, how and why it decays, and how it must be replaced by a new economic system. In short, the object of studying political economy is to find out “the law of motion of modern society” (Marx, Capital, I, p xix) in order that we may hasten the end of capitalism and bring socialism.

Further reading

1. Political Economy: a beginner's course by Leontiev borrow the book at the Internet Archive for 14 days
2. Fundamentals Of Political Economy (Shanghai Textbook) get the book at the Internet Archive
3. Political Economy: A Marxist Textbook by John Eaton get the pdf of the book at LibGen