Political economy revisited: structures and objectives at the systemic level

Political economy developed from profound transformations in economic and political life. The economic sphere extended from the management of individual units, such as households or the royal demesne, to a system defined as the collection of economic activities subject to sovereign authority, and characterized by widening webs of productive and social interdependencies across manifold units. In the political sphere, sovereign decisions came to be considered in the light of the material opportunities and constraints associated with productive interdependencies. Accordingly, the principle of economic life moved from the allocation principles of the household to system-level decision-making, guided by the correspondence between means and polity-level objectives and understood in the light of the material and social interdependences in the polity. The paper maintains that the relationship between economic structures and objectives at the systemic level should become again a central object of political economy. It goes on to argue that the development of structural economic analysis since the 20th century provides powerful analytical tools to investigate: (i) the systemic objectives that polities could pursue given their economic structure; (ii) the social aggregates that could form out of those which economic structure makes possible, and the particular objectives they could construe and pursue; and (iii) the constraints that economic structure imposes on the pursuit of all objectives, be they systemic or particular.