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THREE IDEOLOGIES

1.Economic nationalism

Was called mercantilism, assumes and advocates the primacy of politics over economics. It is a doctrine of a state building and asserts that the market should be subordinate to the pursuit of state interest. Political factors do, or should, determine economic relations.

All nationalist ascribe to the primacy of the state, of national

security and of military power in the organization and functioning of the

international system.

Benign Mercantilism (defensive position): those Who consider the safeguarding of national economic interest as the minimum essential to the security and survival o the state.

Malevolent mercantilism : (aggressive) Those who regard the international economy as an arena for the imperialist expansion and national aggrandizement.

Economic nationalism arises from the tendency of markets to concentrate wealth and to stablish dependency or power relations between the strong and the weak economies. In the defensive form they try to protect economy against external

forces. Most commonly used in the less developed economies that have to take under control protectionism, to safeguard his interest. And in the malevolent form, nationalism is the way to economic wealfare.

They see international commerce as a conflictual and insecure relation, as a consequence that economic interdependence is never symmetrical. Emphasize national self-sufficiency rather than economic interdependence.

Relative gain is more important than mutual gain. That’s why nationalist constantly

try to change the rules or regimes governing international economic relations in

order to benefit themselves disproportionaly to others. Desire for power and interdependence.

States have political and economical interest that are not always fair to everybody.

2. Liberalism

Separation of economics from politics. Economic committed to Free

Markets. Minimal State Intervention. Individual equality and Liberty

Liberalism is defined for organizing and managing a Market Economy in order to achieve maximum efficiency, economic growth and individual welfare.

Creation of Markets, Money and Economic Institutions in order to facilitate exchange, improve their well being and satisfy human wants.

The terms of exchange are determined by considerations of supply and demand. Voluntary exchange - both parties benefit. Behavior is believed to be governed by a set of Economic Laws

It tells how to achieve particular objectives at the least cost under certain constraints

3. Marxism

A socialist Society is both the necessary and desirable end of historical development

The origin, evolution and eventual demise of the capitalist mode of production are, according to Marx ,

governed by three inevitable economic Laws.

Law of disproportionality: The anarchy of the Market causes periodic depression and economic fluctuation

Law of accumulation of Capital: Competition forces the capitalists to increase their efficiency and capital investment or risk extinction

Law of the Falling of profit : Export of Capital and Manufactured goods and the import of cheap Food

The Causes of its downfall were economic; Capitalism would fail for economic reasons as the proletarian revolted against its impoverishment.

The state is the servant of the dominant economic class. International system and foreign policy determined by the structure of the domestic economy. The regimes governing trade, investment, and other international economic relations affect the distribution of wealth among groups and states

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KEYNESIAN POLITICAL ECONOMY (britis '20-'70)

Critique the claim that an unregulated (classical aproach) market will fully exploit society´s productive potential. Prices and demand. the failure is that individual producers may fail to sell because what they have to sell is not wanted by those with the purchasing power to buy it.

Keynes encourage us to reconsider he relation of politics to markets. He´s against the idea of the invisible hand. Capitalist will not make a full use of the resources available to them, thats why they need a government regulation. Society only cares about basic goods they dont have enough money for other thins, thats why classical economy doesn´t work.

Government should try to stimulate demand in the economy. In the context of the great recession and the stock crash of 1929, Roosvelt made some regulation to help and it worked. 1933. we need government policy at assuring a stable process of reproduction and adecuate levels of employment.

The government role: borrowing from issues bonds, by individuals or firms. Spending on goods from private secto,and Taxes revenues from firms and consumers.

interfere in fiscal policy: revenue taxes

monetary policy: flow and price of money (interest rate)

Instead, he promotes the circular flow : Revenue dertermines spending, which determines demand, which stimulates production, which generates revenue.

its a link between income and employment. demand induces both production and investment on the part of the firms.

The act of saving removes renue from the circular flow and that disrupts the flow. people must save just for investment not to acumulate.

Investment in working capital: something current,finished products.

investment in fixed capital: for future demand, equipment etc, long term planing.

Keynes says that workers don´t have the capacity to influence employments in their pleasure.

Points:

crisis dont have to be violent (like marxist)

acumulation of money, not capital.

economy is circular. assure full employment to keep the flow circle

markets can fail, are more able to be in inestability

employments have to have a suffient wage/salary, so they can save and invest.