Political Economy Defined Political Economy is the application of economic principles to the analysis of political decision making Self-interest -in the marketplace, this often leads to efficiency; different implications in" political market Maximization -one goal may be to maximize social welfare2 Political Economy Defined • Political Economy is the application of economic principles to the analysis of political decision making. – Self-interest – in the marketplace, this often leads to efficiency; different implications in “political market.” – Maximization – one goal may be to maximize social welfare