Political Influence in Transition Economies: Firm Level Evidence
POL 540 Journal 7
1. POL 540 GLOBAL POLITICAL SYSTEMS
Distribution of Power within economic systems
How power and wealth is accessed
Phillip Mitchell
11/15/2015
This journal describes how political economy is structured inside political systems to provide the
most effective and efficient conditions for states to create markets that are equitable and just in
nature to make sure optimal opportunity of prosperity is shared among all men not just a few
inside political systems to accurately measure economic benefits and transactional goods.
Toward the end I conclude by illustrating that political institutions and economic structures
determine how policy formation and effective social structures in the form of political
institutions can produce stability and order of political-economic systems to make them more
equitable and proficient in distributing the means of production and scarce resources.
2. Political economy is a discipline inside political that reflects how markets and states are
studied to understand their meaning and purpose inside political systems. This form of study is
called an interaction of states and markets to determine how wealth is distributed in the form of
land, labor, and capital (O’Neil, 2010, p. 323). In addition, this interaction serves as a
relationship to determine how political and economic institutions are created to form outcomes in
the form of transactional goods or utility costs to determine the proper way to distribute power
and wealth inside political systems (O’Neil, 2010, p. 323). Distribution of power determines how
scarce resources are structured and processed based on the establishment of market behavior and
structure in the form of state relations where capital and other assets are traded and bargained to
produce operational benefits which determine how wealth, status size and other state power are
measured inside political systems (Gilpin, 2015, p. 212, 213).
Establishment of behavior inside political systems is important because it creates the
foundation for statesman to determine how to balance the multiple personalities of power. Power
in this sense is the form of military, economic, and psychological to determine their relative size
and power position inside political systems (Gilpin, 2015, p. 214). This equilibrium structure
determines how interests and state attributes are perceived creating a decentralized form of
hierarchy to determine how international relations and other state behavior is achieved to
determine how state control and other actions of men are distributed throughout political systems
determining how mutually rewards can be afforded by statesman (Gilpin, 2015, p. 214). This
decentralized form of hierarchy determines how the science of wealth and power can coexist
creating the mutation of political economy and its different kind of economic relations that can
be harmonious, conflictual, and equitable in determining how statesman balance the attributes of
power to determine state influence over other states (Gilpin, R., 2015, p. 215). Each economic
3. system has its own unique traits it brings to help statesman (in the form policymakers, heads of
states, heads of governments, legislative bodies, supranational institutions, parliaments, and other
political institutions) determine how economic relations are structured.
Economic relations among statesman and states take three different forms to determine
how political economy is formed. These economic relations are as follows: Liberalism, Marxism,
and Mercantilism, which determine how harmony and conflict are measured in the sense of
power to determine how statesmen exist inside the decentralized structure of political economy
(Gilpin, 2015, p. 215). Liberalism is a harmonized structure of political attitude that prioritizes
individual political and economic freedom over a limited state role inside a society (O’Neil,
2010, p. 321). This harmonized political attitude (in the form of liberalism) serves as the
“autonomous spheres of activities” to determine how economic relations should be structured
inside a political system, meaning that with the limited state role inside a society the market will
provide the benefits of invisible hand to all men inside the political system to determine achieved
and social statuses while producing non-zero-sum game where everyone will benefit producing
imperfect unequal economic gains for everyone in terms of developing a decent standard of
living for all (Gilpin, 2015, p. 216-217).
Economic activity is the center of political economy. This unfortunate truth determines
how wealth and power are measured inside political systems. For example, Mercantilism places
emphasis on creating a political-economic system that channels national economic power to
paramount how the domestic economy is viewed to serve as instrument of policy to serve the
needs of the state (O’Neil, 2010, p. 322). This form of national economic power or mercantilism
focuses on the distribution of employment, industry, and military power among nation-states to
determine how economic relations are structured to determine the regime of political economy
4. (Gilpin, 2015, p. 216, 217). As for Marxism, or democratic socialism places emphasis on
freedom and equality are balanced in a political-economic system to determine how social
expenditures and programs are managed throughout the economy (O’Neil, 2010, p. 324). This
emphasis on a balanced framework of freedom and equality for all determines how the
distribution of wealth is structured to produce strong vibrant social classes that create conflictual
activities within political systems to determine which system is better to serve the general will or
national interest of all inside political systems (Gilpin, 2015, p. 216, 217).
This national interest or general will takes shape in the form of state policy to determine
the best method of distribution for distributing power and wealth inside political systems.
Economic interests can be distributed in three ways: in the form of Marxists or basic actors
dictate how economic classes are structured, mercantilists in the form of real actors are nation-
states who determine the national interest of foreign policy, or by liberalists who believe that
economic elites, and other few sub-groups of society make up the structure of power for survival
to create functioning political systems (Gilpin, 2015, p. 216). Each economic theory determines
how political change should exist within a political system. For instance, liberalism determines
how economic growth labor is allocated inside a political system to determine how goods and
services will be enlarged to produce political order and market functionality, while Marxism
tends to argue that the means of production (labor) should determine how political relations and
economic activity should be structured to create the most efficient sociopolitical system (Gilpin,
2015, p. 217, 218). Finally, Mercantilism argues that an economic system works best when
politics is the primary factor determining how wealth is articulated inside a society, which
creates a strategic interest over other states in the form of hegemony to determine how security,
5. industrial development, and other economic dynamics are ordered inside political systems and
international affairs (Gilpin, 2015, p. 218, 219).
Political economy is determined by relative and absolute gains. This means that in terms
of analyzing political economy absolute gains share the view that gains are distributed
throughout a political system in the long-run to determine how economic regimes are structured
to create stability and order in advancing power and wealth (Gilpin, 2015, p. 219, 220). Relative
gains are different in the sense that relative of power of nation-states (state size and status)
determine their relative positions in creating sustainable economic regimes to produce order and
stability in determining how power and wealth are created and maintained over the life of a
regime making it difficult to measure survival and other attributes of states (Gilpin, 2015, p. 220-
225).These different types of gains determine how political economy is structured to produce the
utmost opportunity for wealth to be created by utilizing land, labor, and capital to determine how
economic and political relations should function inside political systems to measure which
system provides the most strength and influence in determining the right structure of power to
efficiently and accurate measure political economy.
As noted, political economy determines how policy choices are implemented by
statesman to measure economic activity. This simply truth determines how policy preferences
are formed and political institutions are structured to determine the right investment, trade, and
exchange rate policies to measure how efficient political systems are in structuring wealth and
power to create functional order and stability (Hiscox, 2015, p. 227-235). In turn, this means that
policymakers inside political institutions (such as Congress, Parliament, Heads of States, Heads
of Governments) will produce effective policies to reflect the proper attitudes of political
economy to make trade, foreign investment, and exchange rates competitive and fair to
6. determine the proper value of each to determine how open governments are in producing
effective state relations and economic policies that create bi-and multi-lateral relations where
strong economic policies produce long-term regimes and rules to help make statesman successful
in determining how economic structures are managed inside political systems to produce wealth
and power (Hiscox, 2015, p. 227-235). In essence, policymakers inside political institutions
structure the rules of political economy to determine political status, influence, power, and other
plurality rule in determining how political parties are structured within political economies
(Hiscox, 2015, p. 234, 235). This form of plurality rule determines the effective representation
and balance of economic elites, politicians, statesman, citizenry interests of men, and other
factions inside political systems to produce a national interest that allows everyone to benefit
equally from political-economic systems not just a select few that are policy elites.
In conclusion, economic structures should determine how economic relations are
distributed throughout political systems. This view was argued by Marx and Engels who
envisioned a political system that focused on equality for all at the expense of developing
safeguards to protect all classes within a political system from external market forces that
represent unequal gains of wealth inside political systems (Marx and Engels, 2015). This means
that a true measure of political economy would reflect attributes of true socialism in which
power and wealth are distributed among each social class equally creating the protections and
safeguards necessary to produce an efficient means of production to produce the utmost
opportunity for success to be measured for all inside a political system (Marx and Engels, 2015).
In essence, (good) socialism or reform liberalism (direct governmental intervention and
distribution of wealth and economic status inside political institutions and social structures)
would be the best method to articulate in creating stability and order inside political and
7. economic systems, allowing political economy to reward the talents of all men, not just a few
regardless of their status, income, or education level could coexist inside a political system to
effective, efficiently, and accurately represent all elements of a society in creating a more
prosperous future for all in creating policy choices that reflect the needs of everyone and not just
the elite inside the political system to determine how balance and influence is structured. In sum,
this means that the economic elites would have to give up some of their influence or power in
terms of crafting economic policy to create a newly structured political-economic equilibrium
that produces policy preferences for all social classes and caste systems in structuring the right
political system to afford opportunity and wealth distribution for all in creating greater influence
of social class views inside policy formation structures, which is what the Soviet Empire did not
understand in its last days before it fell.
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Hiscox, M.J. (2015). Perspectives of Political Economy: The Domestic Sources of
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