Presumptions in Political Economy: Alternative Approaches for Assessing the Economic Role of the State
The Economic Role of the State, Forthcoming
31 Pages Posted: 15 Dec 2014 Last revised: 8 Mar 2015
Date Written: December 14, 2014
We conceive of political economy, historical and contemporary, as reflecting sometimes competing and other times complementary assessments of the appropriate role of the state in economic life grounded in alternative approaches to the paradox of government. We call these differing approaches and the conclusions they generate political-economic presumptions.
This introduction is devoted to, in broad and sweeping terms, describing the major presumptions that have characterized political economy since the field’s inception. Our chief division has three parts: what we call the “laissez-faire presumption,” which dominated political economy in the 18th and early 19th centuries; the “market-failure presumption,” which dominated political economy from the late 19th until the mid-20th century, and the “government-failure presumption,” which broke the domination of the market-failure presumption in political economy in the latter 20th century. Additionally, we consider a fourth political-economic presumption we call the “anarchy presumption.” Unlike the other presumptions we consider, the anarchy presumption is not an established political-economic approach. However, it offers an interesting and, we think, important alternative deserving of further consideration by contemporary political economists.
Keywords: Political Economy, Laissez-faire, Market Failure, Government Failure, presumption of anarchy
JEL Classification: B12; B13; B20; H10; Y20
Suggested Citation: Suggested Citation