The Autonomy of the Political within Political Economy

Advances in Austrian Economics, Vol 22, 2017.

GMU Working Paper in Economics No. 17-22

23 Pages Posted: 17 May 2017 Last revised: 11 Jun 2017

See all articles by Ion Sterpan

Ion Sterpan

George Mason University - Department of Economics

Richard E. Wagner

George Mason University - Department of Economics; George Mason University - Mercatus Center

Date Written: May 15, 2017

Abstract

Political economy is a term in wide use, and has been for centuries. Yet standard economic theory reduces politics to ethics or economics. This reduction is enabled by the presumption of closed choice data or given utility and cost functions. In this conceptual framework, the political vanishes into an activity of preference satisfaction according to a welfare function (ethics) or into trade (economics). To bring the political back to life within a theory of political economy requires that closed schemes of thought be replaced by open schemes. The ways in which individuals react to the indeterminacy of their subjective choice data, in innocuous small scale settings as well as in situations of dramatic exception to constitutional rules, separates them into leaders and followers. Followership creates an opportunity for political enterprise at the social level (enterprise in rules) and at the subjective level (enterprise in visions of options, and hence preferences). At both levels the political comes to the fore of political economy as an answer to the “challenge of the exception”. Much of our inspiration for this argument traces to the work of Friedrich Wieser, Carl Schmitt and Vincent Ostrom.

Keywords: human association; open vs. closed systems; leadership; power; autonomy of the political; political entrepreneurship; liberalism and authority; governance; federalism and polycentricity; Friedrich Wieser; Carl Schmitt; Vincent Ostrom

JEL Classification: B25, D23, D72, H77, L32

Suggested Citation

Sterpan, Ion and Wagner, Richard E., The Autonomy of the Political within Political Economy (May 15, 2017). Advances in Austrian Economics, Vol 22, 2017., GMU Working Paper in Economics No. 17-22, Available at SSRN: https://ssrn.com/abstract=2968652

Ion Sterpan (Contact Author)

George Mason University - Department of Economics ( email )

4400 University Drive
Fairfax, VA 22030
United States

HOME PAGE: http://ionsterpan.com

Richard E. Wagner

George Mason University - Department of Economics ( email )

4400 University Drive
334 Enterprise Hall
Fairfax, VA 22030
United States
(703) 993-1132 (Phone)

HOME PAGE: http://mason.gmu.edu/~rwagner/

George Mason University - Mercatus Center ( email )

3434 Washington Blvd., 4th Floor
Arlington, VA 22201
United States

HOME PAGE: http://ppe.mercatus.org/scholars/richard-wagner

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