Political Economy Overview

Flashcards covering key concepts from the lecture on Political Economy.

Political Economy

The study of how economic systems are shaped by political power, social relations, and institutions.

State-Mercantilism

An early economic system characterized by state control and protectionism, focused on wealth accumulation through trade.

Voluntary Exchange

Economic transactions framed as voluntary interactions between individuals, in contrast to forced labor.

Classical Political Economy

A framework focused on the distribution of income among land (rent), labor (wages), and capital (profit).

Adam Smith

A classical economist known for the idea that self-interest drives economic behavior and that limited government should protect, not control, markets.

Comparative Advantage

A principle developed by David Ricardo, suggesting that countries benefit by specializing in goods they produce more efficiently.

Marx's Critique of Political Economy

Marx's argument that classical economists ignored issues of exploitation and class power in their analysis.

Neoclassical Economics

An economic approach that shifts focus from social classes to individuals and treats markets as neutral.

Keynesian Economics

An economic theory emphasizing the role of the state in managing markets and promoting stability during crises.

Commodity

A good or service produced for exchange in a market economy.

Use Value vs. Exchange Value

Use value refers to the practical usefulness of a commodity, while exchange value is determined by how much of another commodity it can be traded for.

Labor Theory of Value

Marx's principle that the value of a commodity is determined by the amount of socially necessary labor time required to produce it.

Surplus Value

The extra value created in the production process that is appropriated by capitalists, derived from the exploitation of labor.

Commodity Fetishism

The phenomenon where social relations appear as inherent properties of commodities, obscuring the exploitation embedded in production.

Money

A social construct arising from commodity exchange, serving as a medium of exchange, unit of account, and store of value.

Inflation Theories

Theories explaining inflation including monetarist, demand-pull, and cost-push factors.

Capitalist Production

The process not only of making goods but also of producing surplus value through the labor process.

Class Structure

A framework analyzing society based on relations to means of production, sources of income, and power dynamics.

Petty Bourgeoisie

Small business owners who both own and work, situated between capitalists and wage workers.

Reserve Army of Labor

The unemployed population that helps to discipline wages and provides labor during economic expansions.