Perspectives on Political Economy Today

It is important to acknowledge that the emergence of economics as a social science which is separate from the study of politics is a relatively recent development. Not that long time ago, the subject matter of economics was studied under the rubric of political economy, itself an offspring of political philosophy. In our days, however, there is a resurgence of interest in a comprehensive study of economic and political phenomena.
 
One set of reasons behind this renewed awareness of the need for a political economy are issued by developments internal to the contemporary disciplines of economics and political science. Let us then mention some of these. First, the ruling methodology of economics is that of the theory of rational and social choice. However, at the inauguration of these theories they were meant to be applicable to the study of political phenomena as well - let us only recall Arrow's Social Choice and Individual Values. Can we save the vision of the founding fathers of formal analysis in the social sciences in the form of a unified theory underlying both economics and politics? Secondly, we may say that the field of public economics is essentially concerned with underwriting normative judgments about public policy decisions. Behind these normative judgments are elaborate considerations concerning the possibility of aggregating the desires of the participants of an economy, desires concerning social or public economic outcomes and concerning the conditions under which the public could agree with certain policy decisions. Now it has become increasingly clear that these considerations are to a large extent political in nature. Do we need to involve political principles into normative economic analysis as a consequence? As a final and related motivation behind the rebirth of interest in political economy we should mention the obvious fact that ‘real-life’ economic decision-makers have an understandable tendency to avoid the adoption of policies which could lead to a discontent that forces them out of their office. This jeopardy may then prompt them to do something else than what the best normative analysis advises them to do. 
 
Then we are compelled to study what effects certain political systems have on the efficiency of public policy making; thus we have to understand, for example, the relationship between the theory of representative democracies and applied economic theory as well.
 
This course proposes then to study contemporary political economy. We will take up many of the most important aspects of the subject and will emphasize their theoretical basis. At the same time, we will have recurrent and thorough examinations of the experience of transition in Central and Eastern Europe as well, discussing such problems as structural adjustment, monetary policy, welfare reform, political integration, and bank privatization.
 
We expect that researchers and teachers from several fields will join this course. Participants are welcome not only from departments of economics and political science, but also from sociology and philosophy departments. They can enjoy a truly interdisciplinary undertaking. In addition, participation in the course will facilitate the development of political economy curricula in the region.
 
From the Program
 
WEEK 1: Béla Greskovits: ‘Karl Polanyi and Albert Hirschman as Political Economists’ and ‘Adjustment Mechanisms in Eastern Europe and Latin America’; Róbert Gál: ‘The Political Economy of Corruption’; Tore Ellingsen: ‘Institutionalism in Political Economy’ and ‘The Problem of Political Integration’
 
WEEK 2: Loránd Ambrus-Lakatos: ‘Management, Responsibility, and Accountability’ and ‘Game Theory and Political Economy’; Karl Wärneryd: ‘Public Choice and Political Economy’; Alan Hamlin: ‘Economizing with Virtue’ and ‘The Incontinence of Representative Democracy’
 
WEEK 3: Gérard Roland: ‘The Political Economy of Transition’; John Earle: ‘Political Support of Economic Reform Measures’; Anna Leander: ‘The Changing Social Contract’; Juliet Johnson: ‘The Problem of Delegating Authority’ and ‘Can There be a Comparative Political Economy?’