Three Ideologies of Political Economy

Category: Liberalism, Marxism
Last Updated: 27 Jul 2020
Pages: 4 Views: 571

Global power is understood to be both economic and political, which are interrelated in a complex manner. Thus the International Political Economy (IPE) has become a discipline within the social sciences that analyzes international relations in combination with political economy. IPE is considered flexible and contains epistemologies that are subject of robust debate. At the core of the debate are the three main philosophical ideologies (Realism, Liberalism and Marxism) which create conflicts revolving around the role and significance of the market in the organization of society and economic affairs.

This paper will analyze these three philosophical ideologies and explain how the advocates of these ideologies would assess the phenomenon of global integration. Realism, Liberalism and Marxism differ significantly in relation to the IPE. The realist view of IPE is that the economic activities are subordinate to the goal of state building and the interests of the state. They are concerned about the primacy of the state, national security and military power for functioning of the international system. Therefore realists find it important to safeguard the national economy for the security and survival of the state.

The realism is the ideology that drove the economy in the early modern era. During the sixteenth, seventeenth and eighteenth centuries, nation-states relied on industrialization to increase their power in the international arena. The industrialization had a spillover effects throughout the economy which led to overall development. In addition, the industrialization also provided nation-states with the best military equipment which was necessary for national security. The Liberalism ideology of economy on the other hand is committed to free markets and minimal state intervention.

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Liberals rely on price mechanism because they believe it is the most efficacious means for organizing domestic and international economic relations. Additionally, they believe that a market economy is the best way to achieve maximum efficiency, economic growth and individual welfare. The liberal named Becker believes that “a market economy is governed principally by the law of demand” (Gulpin, p 29). Becker explains that this law holds that people will buy more of a good if the relative price falls and less if it rises; people will also tend to buy more of a good as their relative income rises and less as it falls.

Thus the government intervention is not necessary to maneuver the market unless a market failure exists. And, in terms of IPE, they believe that there is no necessary connection between the process of economic growth and political developments such as war and imperialism. Therefore “these political evils affect and may be affected by economic activities, but they are essentially caused by political and not by economic factor” (Gulpin, p 30). The Marxism ideology of economy arose in reaction the Realism and Liberalism in the middle of the 19th century with the central idea that the economy drives politics.

The political conflict arises from struggle among classes over the distribution of wealth. Thus they believe that political conflict will cease with the elimination of market and of a society of classes. The Marxist view believes that only robust application of strong public power can check innate tendencies for private power to benefit elites at the expense of population at large. The Marxism ideology of economy has been used to group together an array of different approaches which sometimes have very little in common with Marx’s focus on class.

Marxism favors strong protection from market forces by means of high tariffs and other controls. They prefer centrally directed trade with ideologically similar trading partners – which are considered a command economy as opposed to market economy. Currently Russia and China is believed to have adopted Marxism as their official economic ideology, but have reshaped it when necessary to serve their own national interests. Currently we live in a profound time of history where globalization is changing the international system in an unprecedented speed.

The number of nation-states is increasing along with their economic interdependence among each other. In this time of global integration economic realism may seem to have disappeared but frequently exists in less developed economies or in those advance economies that have began to decline. In situation like these “governments pursue protectionist and related policies to protect their nascent or declining industries and to safeguard domestic interests” (Gulpin, p 33).

In contrast to realism, liberalism is the most widely adopted economic ideology in the modern world. Liberals believe that trade and economic intercourse are a source of peaceful relations among nations because the mutual benefits of trade and expanding interdependence among national economies will tend to foster cooperative relations. The Marxists believes adoption of global integration and market economy will not help nations-states to sustain economic and political power.

Lenin argued that “the inherent contradiction of capitalism is that it develops the world and plants the political seeds of its own destruction as it defuses technology, industry, and military power” (Gulpin, p 40). Marxists also believe that it creates foreign competitors with lower wages and standards of living who can out-compete the previously dominant economy on the battlefield of world market. Although these three ideologies of IPE are significantly different from each other they are very much alive at the end of twentieth century.

They define the conflicting perspectives that individuals have with regard to the implications of the market system for domestic and international society. In the past, these three ideologies have divided the humanity. But in the present we want to unite the humanity. I believe the liberalism ideology of economy is probably the only way to unite the humanity as it lifts people out of poverty, connects people from different geographies and most importantly gives people a similar identity – a global citizen.

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Three Ideologies of Political Economy. (2018, Sep 22). Retrieved from

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