Political Economy


Trevor Incerti, Assistant Professor of Political Economy
Paul Raekstad, Associate Professor of Political Theory

Note: All questions, requests or issues should be sent to:

Basic information

For administrative reasons this course has a different name and number for those of you who are not enrolled in the Political Science bachelor program. Content-wise there is no difference.

Political Economy

Introduction to Political Economy (for students who follow this course but NOT the political science bachelor)

Course Catalogue Number

73220020FY AND 7322m120FY

Credits

6 EC

Entry requirements

At least 42 EC from the first year of the bachelor’s degree program in Political Science at the UvA.

Instruction and exam language

Instruction: English
Examination: English or Dutch

Location and time

Monday 11.00 – 13.00 REC A 0.01
Wednesday 09.00 – 11.00 REC A 0.01

Video recording Lectures

Lectures will be recorded but will only be made available to students with a documented emergency or disability. If you have a valid reason for not being able to attend the lectures, please send a request for access to the recordings to .

Seminar groups

Students of the regular bachelor program follow ‘Academic Skills for Political Scientists III’ with some attention to Political Economy.

Readings/books

There is no textbook for this course. All readings will be posted on Canvas or accessible through UvA wifi/VPN.

All literature is available through Canvas, or available as a download from the journal website. For direct downloadable articles, the detailed session outline below gives you hyperlinks. You may have to log in through the university network to gain access, either on campus location or through VPN. Other texts will be made available through Canvas.

Author names in blue indicate that the author is a recipient of the Nobel Memorial Prize in Economic Sciences.

Course Objectives & Learning Outcomes

After completing this course, students will be able to:
1. Analyse political and social problems from the political economy perspective as a general line of thought within political science, where the mutual dependency between the political and economic domains plays a central role.
2. Understand the contemporary political-economic order as the product of historical developments in the global political economy and political-economic thought.
3. Place points of view in current political debates in the most important theoretical traditions of political economy.
4. Understand the role of the state in guiding and regulating the economy and the impact of government policies on economic outcomes.
5. Take a substantive position in key controversies in political economy and defend it in discussion with other students.

Course Content

The position of Political Economy (PE) within the Political Science programme is twofold. First, PE is the component of the discipline that studies government policy in relation to ‘the economy’, including delegated policy that is formed or implemented by supranational or international organisations such as the European Union or the World Trade Organisation. Secondly, PE can be understood as a cluster of theories about society and the political processes within it. Characteristic of these theories is that politics and economic power (having tangible and intangible assets) are inextricably linked. The politics and economic system of a society do not just influence each other; they are two sides of the same social order.

The list of examples that illustrate this relationship is long. For instance, democracy and trade have often grown alongside each other. In democracies, it has long been believed that voting behaviour is determined by material interests. Lobbyists from major companies, unions and other interest groups invest significant amounts of money and time attempting to influence government policy to their own advantage. European integration is driven by the perceived economic advantages of the European internal market. Shifts in power between major political players on the world stage, such as China and the US, are largely based on changing economic positions. Economic incentives both play a role in driving climate change and shape how we can design solutions to this crisis. In short: politics shapes the economy and the economy shapes politics. This insight plays a central role in PE: you can’t understand one without the other.

Classic political thinkers recognised the link between the economy and politics. The idea that you could study the economy outside of a historical political framework only came into being at the end of the 19th century. Before this, neither political science nor economics existed - Adam Smith, David Ricardo and Karl Marx were practitioners of what they themselves called political economy. In the decades before the First World War, separate social science disciplines such as economics, political science, and sociology were developed. However, many figureheads of these disciplines – Weber, Carr, Veblen, Keynes and Schumpeter – clearly follow in the tradition of their classical predecessors.

There are five elements to this course: (1) the history political economic thought and of modern capitalism as the dominant (but not the only) organisational form of economic activity, (2) the institutional foundations of capitalism and the relationship between democracy and capitalism (3) how the interplay between political institutions and economic rationality effect political behavior, economic outcomes, and economic organisation (4) examination of the global economic order (and recent backlash), and (5) examination of current policy challenges viewed from a political economy lens.

Teaching methods/learning formats

This course is lecture-based, with some topics also covered in ‘Academic Skills for Political Scientists.’ The lectures give an introduction and further explanation of the course material and readings, as well as further elaboration and application of those readings. There are two lectures per week (exceptions may apply). Students are expected to come well prepared to the lectures. This means that at least you have done all the reading for that lecture and reflected upon the readings. Reading after the lecture is strongly discouraged!

Students are strongly advised to actively participate and keep up with the readings. Every week there is a substantial reading requirement—do prepare well for this! The setup of the course is such that it is difficult to catch up once you fall behind.

Part of the lectures will be Q&A sessions. To generate your questions we will use the Perusall tool. You will read the literature in Perusall and ask questions in this tool. You can also interact with other students, and upvote or downvote comments and answers.

Manner & Form of Assessments

Assessment form Date, time, and location Weight
Active reading/ Perusall Every lecture (online) 15%
Mid-term exam (Multiple choice + short response) Friday 20th September 14:00-16.00 (IWO Red and Yellow) 35%
Final exam (Multiple choice + short response) Friday 18th October 14:00-17.00 (IWO Red and Blue) 50%

All students are awarded a grade, based on three forms of assessment: engagement with course reading materials and other students via Perusall; a midterm exam covering material presented prior to the midterm (which we be held at the exam location, more info at rooster.uva.nl); and a final exam covering all material (which we be held at the exam location, more info at rooster.uva.nl). The midterm and final exam may cover content that has been covered in the required readings and the lectures. The weights of the assessments for the final grade are listed below.

There will be a single resit covering both the midterm and final exams.

Details of each assignment and assessment can be found in the tabs below.

Perusall

We will be using Perusall as a tool to get a sense of which debates, theories, empirical findings, etc. from the readings students would like to discuss in lecture, and to actively engage with the course readings. Your comments should therefore reflect your take on the academic debate, your thoughts perhaps on how the debate could be pushed forward theoretically or empirically, and/or any questions you have about the readings. Don’t worry if you are uncertain about what to write; you will get the hang of it as you go along.

Perusall will be graded on a pass/fail basis, where providing at least one comment of at least 75 words and one interaction with another student per lecture represents a pass (your comment is worth 90% of your Perusall grade and your interaction with another student is worth 10%). Comments must be submitted prior to the start of lecture. You may skip providing Perusall comments for two lectures of your choosing with no grade penalty.

Midterm exam

The midterm exam is a closed-book, in-person exam that will consist of twenty multiple choice and two open-ended questions with two to four sub-questions each. The midterm exam covers all material presented prior to the midterm. In answering the open-ended questions, you should be specific, answer the questions completely, and try to engage (and refer to) the course literature as much as possible. As this is a closed book exam, you are not expected to know proper spelling of names or dates of publication. However, you are expected to be able to recall author names and/or titles of works that are referenced on the exam.

Final exam

The final exam is a closed-book, in-person exam that will consist of twenty multiple choice and four open-ended questions with two to four sub-questions each. The final exam covers all course material. In answering the open-ended questions, you should be specific, answer the questions completely, and try to engage (and refer to) the course literature as much as possible. As this is a closed book exam, you are not expected to know proper spelling of names or dates of publication. However, you are expected to be able to recall author names and/or titles of works that are referenced on the exam.

Inspection of exams/assignments, feedback

For the midterm and final exams, students will be able to review their answers and the assessment thereof. The date for this review will be announced later via canvas. No individual feedback will be given on exam grades, although grading rubrics will be made available after the exams.

Participation

Students are expected to do the readings before class and to come to class prepared to engage with the readings. Because of the interactive nature of this course, attendance and participation is required.

Be respectful to your peers by being on time and silencing your cell phone and other notifications. You are encouraged to participate in class discussion and share your thoughts.

Other matters

Social safety and inclusivity

We want students to be assured they have a positive environment and a safe basis for their studies. We hope you never experience an unsafe situation or undesirable behaviour at the UvA, but should this occur there are different individuals and institutions you can turn to. See https://student.uva.nl/en/content/az/social-safety/social-safety.html for more information.

I hope to foster a sense of community and consider this to be a place where you will be treated with respect and where you will treat others with respect. If you have a documented disability and need any accommodations, please let me know. All members of this class are expected to contribute to a respectful and welcoming environment for every other member of the class. To do so, it is important that we approach every class discussion with an open mind and a willingness to appreciate different experiences and perspectives, even when they do not align with our own. Every member of this class should feel empowered to offer their opinions in class but should be respectful to every other member of this class while doing so. I am committed to ensuring that every student feels heard in this classroom. Critiques of an intellectual nature are permitted, while ad hominem (personal) attacks are never permitted.

Academic integrity, plagiarism, and AI

The provisions of the Regulations Governing Fraud and Plagiarism for UvA Students apply in full. Access this regulation at https://student.uva.nl/en/content/az/plagiarism-and-fraud/plagiarism-and fraud.html.

Plagiarism can take many forms, including (but not limited to!):

  • Making use of or reproducing another person’s texts, data or ideas without complete and correct acknowledgement of the sources.
  • Presenting the structure or central body of ideas taken from third-party sources as one’s own work or ideas, even if a reference to other authors is included.
  • Submitting a text that has previously been submitted, or is similar to a text that has previously been submitted, in the context of assignments for other courses.
  • Reproducing the work of fellow students and passing it off as one’s own.

If you have not read these regulations before, please do so! Note that plagiarism is very serious. In case of alleged plagiarism and/or fraud the teachers will inform the examination committee immediately. In general: DON’T EVEN THINK ABOUT IT.

Please note that, unless the course instructor has explicitly given permission to use AI in an assignment, any use of ChatGPT or other AI-tools is considered to be fraudulent. Some students have recently been suspended temporarily from the university for using ChatGPT. So, if you violate these rules, you are not only limiting your opportunities to improve your analytical and writing skills, but you are taking a huge risk at the same time. Moreover, please be aware that AI-detection software is improving rapidly. The Examination Board may evaluate old assignments in the future with new and improved AI-detection tools. So, even if you think you got away with it now, you may suffer the consequences later.

Program outline and readings

Please note: the program, including the readings, may be updated during the course. Any updates/changes will be mentioned during the lectures, and notifications are posted on canvas. Any changes made are mentioned on the last page of this course manual.

Lecture 1: What is political economy?

Instructor: dr. Trevor Incerti

Is political economy the interaction between politics and economics or the microeconomy of politics? How do different disciplines view political economy and how has the study of political economy changed over time? What logics and assumptions underpin political economic theories, and how are these theories empirically tested?

Required readings:

  • Weingast, B.R. and Wittman, D. “The Reach of Political Economy” in The Oxford Handbook of Political Economy. Read pages 3-6.
  • Frieden, J. (2020). “The political economy of economic policy.” Finance & Development, 57(2).
  • Tirole, J. (2018). Economics for the common good. Princeton University Press. Read Introduction pages 1- 5 (on Canvas).

Suggested readings:

  • Read the introduction to Barma, N. H., & Vogel, S. K. (2021). The political economy reader: Contending perspectives and contemporary debates. Routledge.
  • Stilwell, F. 2012. Political Economy: The Contest of economic ideas. 3th edition. Sydney: Oxford University Press. pp. 2-9. Available through canvas
  • Smith, N. (2019). “Economists Need to Add a Little History to Their Tool Kit” online in Bloomberg opinion. Also available on Canvas
  • Strange, S. (1988). “Prologue: Some Desert Island Stories”, in States and Markets. Londen: Pinter, pp. 1-6. Available through canvas
  • Lake, D.A., “International Political Economy: A Maturing Interdiscipline”, in The Oxford Handbook of Political Economy.

Lecture 2: Classical political economy

Instructor: dr. Paul Raekstad

Required readings:

  • Stilwell, F. (2012). Political Economy. The Contest of Economy Ideas. 3th edition. Sydney: Oxford University Press. pp. 51-64. Available through Canvas
  • Kennedy, G. (2009). Adam Smith and the invisible hand: From metaphor to myth. Econ Journal Watch, 6(2), 239.

Suggested readings:

  • Samuels, WJ. 1977. The Political Economy of Adam Smith. In Ethics Vol. 87, No. 3 (Apr.), pp. 189-207 An excellent explanation of Smith and his work
  • Polanyi, K. 1944. The Great Transformation.
  • Heilbroner, R. (1953). The Worldly Philosophers, chapter 4 (Malthus and Ricardo), (available online).

Lecture 3: Marxist political economy

Instructor: dr. Paul Raekstad

The paper by Robinson is an example of a modern and clearly Marxist inspired analysis of the Global Political Economy. When reading it pay particular attention to how he builds on some of the core elements of Marx and his work.

Required readings:

  • Stilwell, F. (2012). Political Economy: The contest of economic ideas. 3rd edition. Sydney: Oxford University Press. pp. 98-125.
  • Robinson, W. I. (2019). Global capitalist crisis and twenty-first century fascism: Beyond the Trump hype. Science & Society, 83(2), 155-183.

Suggested readings:

  • Heinrich, M. 2012. An Introduction to the Three Volumes of Karl Marx’s Capital. New York: Monthly Review press.

Lecture 4: Keynesianism and the liberal paradigm

Instructor: dr. Trevor Incerti

What is Keynesian economics, and how does Keynesianism influence macroeconomic policymaking today? What is neoliberalism, what are its philosophical and theoretical origins, and how have views about neoliberalism among economists, policymakers, and international organizations changed over time? Are Keynesian and/or neoliberal economic policies empirically supported?

Required readings:

  • Heilbroner, R.L. (1953). “The Heresies of John Maynard Keynes,” in The Worldly Philosophers, 249-287 (On Canvas).
  • Jahan, S., Mahmud, A. S., & Papageorgiou, C. (2014). What is Keynesian economics? Finance & Development, 51(3), 53-54.
  • Friedman, M. (1962) Capitalism and Freedom. University of Chicago Press. Read Chapter 1 (on Canvas).
  • Ostry, J., Loungani, P., and Furceri, D. (2016). “Neoliberalism: Oversold?”, in Finance & Development.

Suggested readings:

  • Blinder, A. S. (2008). Keynesian economics. The concise encyclopedia of economics, 2(008).
  • Naidu, S, Rodrik, D., and Zucman, G. (2020). “Economics after Neoliberalism: Introducing the EfIP Project.” AEA Papers and Proceedings, 110, 366-71.

Lecture 5: Institutionalism and institutions in historical perspective

Instructor: dr. Trevor Incerti

What are institutions, and what is the purpose of institutions? As you read, think about whether institutions constrain the actions of rational economic agents, or if rational economic agents reshape institutions in their interests.

Required readings:

  • North, D.C. (1990). “An introduction to institutions and institutional change.” In Institutions, Institutional Change and Economic Performance, 3-10.
  • Hall, P. A., & Taylor, R. C. (1996). “Political science and the three new institutionalisms.” Political Studies, 44(5), 936-957.

Suggested readings:

  • North, D.C. and Weingast, B.R., 1989. Constitutions and commitment: the evolution of institutions governing public choice in seventeenth-century England. The Journal of Economic History, 49(4), pp.803-832.
  • North, D.C. (1991). “Institutions.” Journal of Economic Perspectives (5)1, 97-112.
  • Aoki, M. (2007). Endogenizing institutions and institutional changes. Journal of Institutional Economics, 3(1), 1-31.
  • Shepsle, K.A., “Old Questions and New Answers about Institutions: The Riker Objection Revisited”, in The Oxford Handbook of Political Economy.

Lecture 6: Democracy and Economic Development

Instructor: dr. Trevor Incerti

This session will focus on two core questions in the political economy of development: (1) what economic conditions are most likely to give rise to democracy? (2) Is a democratic system of government more conducive to economic growth? Think about the conditions under which democracy may help or hinder economic development. Are all wealthy and advanced developed economies economically open, stable, capitalist democracies? Was this true historically? What about today? Were all wealthy countries democracies during their development?

Required readings:

  • Ansell, B., and Samuels, D. (2010). “Inequality and democratization: A contractarian approach.” Comparative Political Studies 43(12), 1543-1574.
  • Acemoglu, D., Naidu, S., Restrepo, P., & Robinson, J. A. (2019). Democracy does cause growth. Journal of Political Economy, 127(1), 47-100. Read pages 48-59 and 96-97 only.
  • Hall, P. A. and D.W. Soskice. (2001). Varieties of capitalism: The institutional foundations of comparative advantage. Oxford: Oxford University Press. Introduction, pp 1-44

Suggested readings:

  • Iversen, T., “Capitalism and Democracy”, in The Oxford Handbook of Political Economy.
  • Haber, S., “Authoritarian Government”, in The Oxford Handbook of Political Economy.
  • Acemoglu, D., and Robinson, J. A. “Paths of Economic and Political Development”, in The Oxford Handbook of Political Economy.

Lecture 7: Inequality and Redistribution

Instructor: dr. Paul Raekstad

Required readings:

  • Piketty, T. (2014). Capital in the Twenty-first Century. Harvard University Press.
  • Glaeser, E.L., “Inequality”, in The Oxford Handbook of Political Economy (2008)
  • Introduction A History of Crisis. Video, available online at: https://voxeu.org/content/history-credit

Suggested readings:

  • Robinson, W. I. (2017). Capitalism in the twenty-first century: Global Inequality, Piketty, and the transnational capitalist class. In Twenty-first century inequality & capitalism: Piketty, Marx and beyond (pp. 238-254). Brill.
  • Scheve, K., & Stasavage, D. (2010). The conscription of wealth: mass warfare and the demand for progressive taxation. International Organization, 64(4), 529-561.
  • Kiser, E., & Karceski, S. M. (2017). Political economy of taxation. Annual Review of Political Science, 20, 75-92.

Lecture 8: Political competition, rent seeking, and regulation

Instructor: dr. Trevor Incerti

How are individual “agents” expected to behave in society, how do they interact with others, and what implications does this have for society-wide economic outcomes? Why are collective actions like voting and protest “irrational” according to these models? Why is it more likely that small groups with high stakes are more likely to act collectively than large groups with diffuse interests, and what implications does this have for economic organization, institutional structures, and regulation?

Required readings:

  • Read the introduction (pp. 1-3) to: Olson, M. (1971) The Logic of Collective Action: Public Goods and the Theory of Groups. Vol. 124. Harvard University Press (On Canvas).
  • Ostrom, E. (2009). A General Framework for Analyzing Sustainability of Social-Ecological Systems. Science, 325(5939), 419–422. *
  • Carrigan, C., & Coglianese, C. (2011). The politics of regulation: From new institutionalism to new governance. Annual Review of Political Science, 14, 107-129.

Suggested readings:

  • Ostrom, E. (2009). “Beyond Markets and states: Polycentric Governance of complex economic systems.” Nobel Prize Lecture. *
  • Watch Elinor Ostrom’s Nobel Prize in Economics Lecture*
  • Olson, M. (1982). Rise and Decline of Nations (Yale University Press), ch. 2 “The Logic” pp. 17-36
  • Ostrom, E. (2000). Collective action and the evolution of social norms. The Journal of Economic Perspectives, 14(3), 137-158. *
  • De Figueiredo, J.M. and Richter, B.K., 2014. Advancing the empirical research on lobbying. Annual Review of Political Science, 17, pp.163-185.
  • Svensson, J. Eight Questions About Corruption. The Journal of Economic Perspectives.
  • Stigler, G. (1971). “The Theory of Economic Regulation.” Bell Journal of Economics and Management vol.2/1 (Spring), pp. 3-21. *
  • Dal Bó, E., 2006. Regulatory capture: A review. Oxford Review of Economic Policy, 22(2), pp.203-225.
  • Bombardini, M. and Trebbi, F., 2020. Empirical models of lobbying. Annual Review of Economics, 12, pp.391-413.
  • Kalla, J.L. and Broockman, D.E., 2016. Campaign contributions facilitate access to congressional officials: A randomized field experiment. American Journal of Political Science, 60(3), pp.545-558.

Lecture 9: International trade and international finance

Instructor: dr. Trevor Incerti

Required readings:

  • Rogowski, R., “Trade, Immigration, and Cross‐Border Investment”, in The Oxford Handbook of Political Economy.
  • Milner, H. V. (1999). The political economy of international trade. Annual Review of Political Science, 2(1), 91-114.
  • Frieden, J. (2016). The governance of international finance. Annual Review of Political Science, 19, 33-48.

Suggested readings:

  • Mishra, P. “The Rise of China and the Fall of the ‘Free Trade’ Myth”. The New York Times, 7 February 2018.
  • Schwartz: Chapter 10, “International Money, Capital Flows, and Domestic Politics”
  • Adsera, A., & Boix, C. (2002). Trade, democracy, and the size of the public sector: The political underpinnings of openness. International Organization, 56(2), 229-262.
  • Schwartz: Chapter 13, “Trade and the rise and fall of Globalization 2.0”
  • Kim, I. S., & Osgood, I. (2019). Firms in trade and trade politics. Annual Review of Political Science, 22, 399-417.
  • Schwartz: Chapters 6-9
  • Pages 5-10. Broz and Frieden. “The Political Economy of Exchange Rates.” In The Oxford Handbook of Political Economy.
  • Eichengreen, B., ‘European Integration’, in The Oxford Handbook of Political Economy.

Lecture 10: Globalisation and its backlash

Instructor: dr. Trevor Incerti

What is the economic and political logic behind the rapid globalization of the 20th century, as well the recent backlash to globalization seen in many countries?

Required readings:

  • Trubowitz, P., & Burgoon, B. (2023). Geopolitics and democracy: the Western liberal order from foundation to fracture. Oxford University Press. (read the Chapter 1, “The Solvency Gap”, on Canvas)
  • Walter, S. (2021). The backlash against globalization. Annual Review of Political Science, 24, 421-442.

Suggested readings:

  • Rodrik, D. (2011). The globalization paradox: democracy and the future of the world economy. WW Norton & Company.
  • Scheiring G, Serrano-Alarcón M, Moise A, McNamara C, Stuckler D (2024). The Populist Backlash Against Globalization: A Meta-Analysis of the Causal Evidence. British Journal of Political Science 1–25.
  • Bisbee, James, and B. Peter Rosendorff (2024). “Anti-Globalization Sentiment: Exposure and Immobility.” American Journal of Political Science.

Lecture 11: Industrial policy and economic security

Instructor: dr. Trevor Incerti

What is industrial policy? Is the rapid economic development of some countries attributable to successful industrial policy? What are the economic, political, and security justifications for industrial policy? Why was industrial policy dormant for decades, and why has it seen a recent revival?

Required readings:

  • Stiglitz, JE (1996). Some lessons from the East Asian miracle. The World Bank Research Observer, 11.2, 151-177.
  • “Many countries are seeing a revival of industrial policy.” The Economist (2022).
  • Cohen, P., Bradsher K., & Tankersly, J. (2024). “How China pulled so far ahead on industrial policy.” The New York Times.

Suggested readings:
* Wong, F. & Tucker, T. (2023). A Tale of Two Industrial Policies: How America and Europe Can Turn Trade Tensions Into Climate Progress. Foreign Affairs. * “Many countries are seeing a revival of industrial policy.” The Economist (2022). * “New industrial policies will make the world more unequal.” The Economist (2023). * Criscuolo, C., Martin, R., Overman, H. G., & Van Reenen, J. (2019). Some causal effects of an industrial policy. American Economic Review, 109(1), 48-85.

Lecture 12: Energy and climate change

Instructor: dr. Paul Raekstad

Required readings:

  • Young, K A. 2024. Abolishing Fossil Fuels: Lessons from Movements That Won. Oakland, CA: PM Press, Introduction.
  • J. B. Foster, B. Clark, and R. York, The Ecological Rift: Capitalism’s War on the Earth, Ch. 5. R.
  • Hahnel, Green Economics: Confronting the Ecological Crisis, Ch. 4.

Suggested readings:

  • Christophers, B., (2024), The Price is Wrong: Why Capitalism Won’t Save the Planet. London: Verso.
  • Meckling, J., Lipscy, P.Y., Finnegan, J.J. and Metz, F., 2022. Why nations lead or lag in energy transitions. Science, 378 (6615), pp.31-33.