Political Economy

The political economy (VWL, in former times also political economy or economic-political sciences) is a subsection of the economic science. It examines problems, which result from the fundamental phenomenon of the scarceness of goods. The scarceness requires economizing the restaurant subjects. This area of conflict models the VWL both einzelwirtschaftlich and overall all economic

Tools and topics of the VWL

Tools of the VWL

Mathematical models play a substantial role in the VWL, since they require clear proof and clearly defined acceptance and usually not too ambiguous or “softly” interpretable results lead. The general economical beginnings can be represented however with simple arithmetic and the shifting of curves, without one, must bring along deeper mathematical knowledge. The Austrian school represents even the view that each model, which goes beyond simple logic is even unsuitable not only redundantly, but for economic analyses. In the last years, an increasing tendency points itself to work.

Subsections of the VWL

  • which is concerned with the relations of individual restaurant subjects such as households and enterprises. It examines with its einzelwirtschaftliche connections.
  • which regards the economy on an aggregated level in the general context. It examines with its overall economic connections. This can happen approximately on the level of a country, a community of states like the European Union or also the world economy altogether. Examples of investigation articles would be the overall economic income, occupation, inflation, etc.

In the last twenty years, there were attempts again and again to tooth these two basic directions with one another. Today macro-economic analyses are developed frequently on micro-economic connections (technical term: “micro-founds”).

  • This is concerned with the quantitative, usually, empirical investigation of the restaurant happening. Here mathematical methods of the statistics and stochastics are used.
  • A comparatively recent Forschungsgebiet represents the experimental economic research, in which the theoretical behavior acceptance of the is experimentally examined.

Fields and topics in the VWL

In the political economy entire and einzelwirtschaftliche connections and processes are examined. Basic questions are trade, resource allocation, the causes of the prosperity, the organization of production, the distribution of the prosperity in a society, causes of economic crises as well as the topics finances, taxes, work and unemployment, right, poverty, environmental protection and many different used thereby.

  • General

Market — General equilibrium theory — Market equilibrium — Supply and demand — Price — Use function — Factor of production — Production function — Development economics –Public finances — Public goods — external effects — Network effects — national adjustment

  • Special

Job market — Education economics — Family economics — Health economics — — Regional economics — Traffic economics — Environmental economics — Innovation economics overall economic consumption — Overall economic investments — Fiscal policy — Monetary policy — Price level — Rate of exchange development — Economic situation theory — Economic growth — Unemployment and/or overall economic occupation

  • International trade relations

Goods-economical and monetary external trade theory — Tariff theory — Commercial policy — Balance of payments — International institutions — Economic integration

  • Methodology

Decision theory — — Experimental economics — — Game theory — Wirtschaftsgeografie — Restaurant economics — Economic policy

History of the political economy

Working on fundamental economic questions of theoretical nature after a general view in mercantilism were begun. A genuine academic debate did not give it at this time naturally yet. Thomas Mun was one of the earliest economic authors and wrote bspw. over commercial balance sheets of two countries. Also, Jean Baptiste Colbert was one of these earliest authors, it concerned itself with state interventions into the economy.

Three important early theoretical authors were above all William Petty, John Law and John curl, the first theoretical findings over bspw. Money circulation and money and/or notes (Assignaten) published.

After the merkantilistischen and physiokratischen epoch developed with Adam Smith, David Ricardo, Jean Baptiste Say and other authors the classical political economy.

Above all Smiths’ work “at Inquiry into the Nature and Causes OF the Wealth OF nation “is today important basic work of the national economy theory. In this, it already summarizes (also of others) developed theories and formulates a structure of economic connections. Smiths’ most important contribution is the concept of the “invisible hand”, which represents the interaction of supply and demand on a free market.

Ricardo developed the concept of the division of labor and the comparative cost advantages of two countries and described, why trade positively affects the economy and the Faktorallokation of two countries. As a first German economist Friedrich cunning can be marked with its Hauptwerk the national system of the political economics of 1841. It borders itself from the English classical period in its theory of the domestic market and its theory of the productive forces. It is considered as a father of the customs union and the building of railways. Starting from beginning 19. Century wrote several restaurant economics relatively independently important works over the monopoly theory (Cournot and Dupuit) or area planning and location planning (Johann Heinrich of Also Karl Marx belonged into this epoch, although one states, Marx developed further only Ricardo and not cunning (Schumpeter stated, Marx had thought “the errors Ricardos to end”).

With running out 19. Three of each other independent schools the marginal utility theory, which caused the so-called marginalistic revolution, developed for a century: The Austrian school by Carl Menger, which to Cambridge School of William Stanley Jevons and the Lausanne school around Leon whale-race. All three schools developed the theories further of the marginal utility and the general equilibrium. However substantial bases of the marginal utility theory were developed already approximately 20 years before (around 1850) by the German economist Hermann Heinrich Gossen, which however until far after its death unknown remained. Only larger attention found Gossen after its death.

The three neoclassical schools brought a multiplicity out of important economists, who coined/shaped the economic theory up to the Second World War crucially: The Austrian school still consisted beside Carl Menger of Eugen of Bawerk, Friedrich of Wieser, Joseph Schumpeter and Ludwig von Mises. To Cambridge, the School belongs beside Jevons the outstanding English economist Alfreds Mars-resound, who as the first used the term “Economics” instead of “Political economy” and which economic theory transferred thus term-moderately into its own science. Further belonged to the Cambridge School Francis Edgeworth, Arthur Cecil Pigou and John May pool of broadcasting corporations Keynes. Among the Lausanne school, which was coining/shaping for a stronger mathematical arrangement of the economic theory, ranks beside whale-races above all Vilfredo Pareto, Eugenius Slutsky and Irving Fisher, the probably most important US-American economist in the first half 20. Century. Among the Lausanne school can be ranked also still Heinrich of Stackelberg as well as Paul Samuelson.

The neoclassical and the keynesianische theory have at present the strongest influence on the scientific theory formation, monetarism and the Neoliberalismus affect at present most strongly the economic policy. The current different views to the economic policy leave themselves at the best by the annual appraisals of the board of experts for the investigation of the overall economic development (15 November) and the working group alternative economic policy (1. May) pursue.

The outsider positions debits and free economics are two thinking schools, which are hardly taught in the training.

People pictures in the VWL

In the political economy frequently with the model acceptance, homo oeconomicus one works to maximize after which humans rationally act, in order for his well-being under the given status of information. This model seems for many investigations sufficiently, since the irrational preferences of the individual individuals in the sum adjust themselves.

Newer research models extend increasingly the acceptance and refer irrational behavior into their models for further discussion of the behavior economics also, so e.g. in the game theory. Some researchers already received the Wirtschaftsnobelpreis for these beginnings lent. The moreover one newer economic people pictures consider opportunistisches behavior (opportunism, Williamson), under what self-interested thinking paired with cunning and the limits of the human due to limited cognitive capacities is understood (bounded rationality, Simon). Thus such human characteristics are considered in the new

Over it going out developments like those of the so-called REMM (resourceful, evaluating, maximizing one, Meckling) refer besides the adaptability of humans into the view also. Helmut Woll showed that economics knows a variety of different people’s pictures.

Admitted political economists

  • 18. Century

Francois Quesnay *1694 – first economic cycle theory Adam Smith * 1723 – “invisible hand”, classical period Jan Baptiste Say * 1767 – Say theorem, classical period David Ricardo * 1772 – theory of the comparative advantages, classical period

  • 19. Century

John Stuart Mill * 1806 – liberal philosopher, social reformer, classical economist Friedrich cunning first German economist Luigi Bodio * 1840 – publishers of the Statistique international caissesEugen of BawerkAntoine Augustine CournotHermann Heinrich GossenWilliam Stanley Jevons – founders of the Cambridge SchoolKarl Marx * 1818 and Friedrich Engels * 1820 – socialismCarl Menger – founders of the Austrian school Marie ESPRIT whale-race * to 1834 – founders of the Lausanne school, equilibrium in the total analysis, NeoklassikGustav of Schmoller association for SocialpolitikFriedrich of Wieser

  • 20. Century

Kenneth Arrow – measure for the measurement of the risk aversion, together with John Pratt, therefore also admits as Arrow/Pratt measureGeorge A. Akerlof – Adverse selection with information asymmetry, sour cucumber problem (Lemons problem)Gary Stanley Becker – application of the to all areas of life, NeoklassikNikolai Iwanowitsch Bucharin – Marxist economic systemKarl books – history of the restaurant formsRonald Harry Coase – The nature OF the firm (existence of transaction costs), the Coase theorem, founder of the newMilton Friedman – founders of the monetarismJohn Kenneth Galbraith – competitive policy, The Concept OF Countervailing powerTo Silvio associate – founders of free economics – the natural economic system by open land and free moneyThe diminished stateFriedrich August von Hayek – the condition of the liberty, (spontaneous order, non–centralization barness of the knowledge)John Richard Hicks – compensation test, together with Nicholas KaldorMichael Jensen – (Agency theory)Lord John May pool of broadcasting corporations Keynes – founder of the Keynesianismus, inquire-oriented economic policyWassily Leontief – development of the input-output analysisLenin – model of the planned economyRobert E. Lucas – development of the theory of rational expectationsMerton H. Miller – the Modigliani Miller theorem compiled for UnternehmensfinanzierungFranco Modigliani – dito. Robert Mundell – development of economic situation models and theoretical work to currency communities Franz Oppenheimer – joint founders of the social free-market economy, GenossenschaftswesenVilfredo Pareto – founders of the Pareto optimumArthur Cecil Pigou – Internalisierung of external effects, e.g. environmental pollution (Pigou tax)Paul A. Samuelson – advancement of the “general analytic and methodologischen level of the economic science” (from the reason for the award of the Nobelpreises)Joseph Alois Schumpeter – theory of the economic development, economic situation theory Pure hard rare – concept of the part-play-perfect equilibriumAmartya Sen -Robert Solow – growth theory (Solow model)Piero Sraffa – theory of the product value, criticism of the marginal utility theory George Stigler – Chicago School OF Antitrust, showed empirically that modern market managing are subject to far more intense competition than its critics to admit wantOlive Williamson – Markets and HierarchiesThe Economic institution OF Capitalism, (theory of the company)

Organizations, federations, and associations

  • Association for Socialpolitik
  • Working group alternative economic policy
  • Federal association of German people and operation managers
  • Professional association for restaurant economics and studying economic science

See also

  • Portal: Economics
  • List of economists
  • of the economic science
  • German Zentralbibliothek for economic science


  • N. Gregory Mankiw: Fundamentals of the political economy. Poeschel publishing house, Stuttgart 2001 ISBN 3-7910-1853-1 (explains complex connections in easily understandable language and gives a detailed entrance to the subject, 868 sides)
  • Paul A. Samuelson, William D. north house: Political economy. ISBN 3-636-03033-7 (a well-known standard work)
  • Ulrich van Suntum: The invisible hand. Springer publishing house, Berlin Heidelberg New York 2000 ISBN 3540252355 (overview-providing entrance into the political economy, particularly also for interested specialized foreigner suitably)
  • Gilberto Granados/Erik Gurgsdies: Economics – a systematic overview of the Grundprobleme developed market managing by the example of the Federal Republic of Germany. Particularly suitable for interested laymen. Dietz 1999, ISBN 3-8012-0270-4
  • Yokes Schumann: History of the economic theory. In: The restaurant study (WISU), 19. Jg., number 10 (October 1990), P. 586-592.