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The Personal is the Political
•Who makes economic decisions?
•What is the current political economic context in
which those decisions are made?
•What are the principal political economic
challenges we face?
• Study ‘economics’ would offer guidelines for
‘making money’?
• Sometimes disappointed to find that it is about
how the economic system works rather than how
the system can be worked!
• People are likely to make more astute business
and financial decisions if they know about the
economic, social and political forces shaping the
business and financial environment.
• Taking a personal perspective helps focus
attention on how individuals are affected by
broader political economic forces.
• It provides a way of understanding the connections
between the individual’s economic circumstances
and the functioning of the economy as a whole.
• It also makes the link between ‘micro’ personal
choices and ‘macro’ social choices.
Economic Decisions
• In our day-today lives involve many economic
decisions. Most of these are small-scale and shortterm and of no apparent significance beyond our
immediate family and friends. But in the aggregate,
they shape the economic environment which we
• Some such decisions, showing various social and
economic roles, are described below.
As students
• invest in our economic future and pursue personal
• How much education we undertake and how many
qualifications we acquire are likely to have a bearing
on our future economic opportunities.
• These are important strategic choices about
investment in ‘human capital’.
As consumers
• Daily decisions about which of the baffling array of
products we will spend our disposable income.
• Also decisions about how prepared we are to forgo
the immediate gratification of consumption in order to
accumulate personal savings.
As workers
• Face with constrained choices about the jobs we
seek and the hours we work.
• Make periodic strategic decisions, individually or
collectively, about the stance to take in negotiations
with our employers about wages and conditions of
As business decision-makers
• Make strategic decisions about employment and
wages payments.
• Periodically review the methods for producing goods
and services, decide how much they will invest in new
production facilities, decide on the prices for their
products and review sales promotion practices.
As speculators
• Continually review their portfolio of assets, deciding
what to buy and sell according to their judgements
about future price movements and the possibility of
making capital gains.
As bank managers
• Decide about making loans to their clients
• Make decisions about interest rates offered to
depositors and charged to borrowers
• The margins between these borrowing and lending
rates are the principal source of banks’ profits, and
they are kept under continual review.
As government ministers
• Especially those in key departments like Treasury and
Finance, make frequent adjustments to economic
• In response to changing economic conditions in
national and global markets, and to political pressures
to modify their policy settings.
An environment of economic uncertainty
• Technology are transforming the way goods and
services are produced and, the way information is
transmitted; barriers to economic intercourse
imposed by the ‘tyranny of distance’ and national
boundaries are being eroded; growing economic
power of transnational corporations (see table below).
• The nature of work is changing; persistent
unemployment; more women are in the waged
workforce, but the allocation of household tasks
has not changed.
• The proportion of older people in the population continues
to grow; issues about intergenerational income transfers;
the capacity of governments to manage those processes
seems to be regularly threatened by the difficulties of
maintaining systems of taxation to generate the necessary
• Increased income inequalities both within and among
nations; the slowdown in economic growth rates in the
wealthier nations; imbalances of trade and debt between
rich and poor countries highlight the long-established
problem of economic inequality.
Three trilogies
It is taxonomic in character– emphasising
classification rather than explanation. It draws
attention to some broad social choices and to
some tensions that arise at the interfaces between
various types of economic arrangement.
1. Institutions:
market, state, community
• Draws attention to the different ways in which economic
activity can be organised.
• Goods and services may be produced for exchange in
the market. The state usually becomes the economic
manager. Production and distribution could occur directly
in the community to serve community needs.
• The balance between public and private sectors of the
economy, voluntary and government welfare provision,
and the extent to which social life is structured by market
2. Spatial scales:
global, national, local
• Spatial scales at which economic activities can be
organised and coordinated.
• How these three spatial scales are articulated and how
best to strike a balance between them are key issues.
• From a political perspective, these concerns manifest in
the challenges to national sovereignty, the development of
global cities and regionalist responses.
• From an analytical perspective, this means that the spatial
dimension is an important aspect of political economy.
3. Systems:
economic, social, ecological
• Economic activities depend on certain social and
ecological preconditions– e.g., the availability of
labour and natural resources– and they have
major social and environmental consequences.
• The tensions affect distributional equity,
ecological sustainability, and the quality of life.
Final thoughts
• As individuals, we all participate in the political economic
drama. It helps to know what is going on and what our
options are, individually and collectively.
• We must try to understand the economic institutions and the
structures of political economic power that shape our lives,
for better or worse.
• We have to understand the forces driving the economic
changes and shaping the political priorities and possibilities.
• More than that, we have to identify what can be done to
produce political economic futures more in keeping with our
individual and collective needs and aspirations.