Exercises 1. Q1: What does the term “scope” refer to in the citation?

Q1: What does the term “scope” refer to in the citation?

(a) field of study

(b) the methodology

(c) the subjects/units of analysis

(d) territory

Q2: Which of the following expressions can best describe the content of the citation above (according to the textbook)?

(a) new political economics

(b) economic imperialism

(c) classical political economy

(d) political imperialism

Q3: What exactly does the term “economic imperialism” mean?

(a) it refers to a political approach (rational calculation) to economics which means that economy is simply an environment, a context within which the behaviour of the social actor can be (and has to be) analysed.

(b) it refers to an economic approach (irrational calculation) to politics which means that politics is simply an environment, a context within which the behaviour of social and economic principles can be (and has to be) analysed.

(c) it refers to a political approach (irrational calculation) to economics which means that economy is simply an environment, a context within which the behaviour of social scientists can be (and has to be) analysed.

(d) it refers to an economic approach (rational calculation) to politics which means that politics is simply an environment, a world, a context within which the behaviour of the social actor can be (and has to be) analysed.

Q4: Which of the following can be studied by applying an economic approach according to economic imperialists?

(a) the behaviour of a lawyer

(b) the behaviour of a mother

(c) the behaviour of a plumber

(d) the behaviour of a consumer

Q5: According to the citation, economics is…

(a) one field of the social sciences

(b) a methodology which should be transplanted into any other field of the social sciences

(c) a theory that should be kept at bay

(d) a universal approach to the understanding of human behaviour

B)

In the following, you will find several statements. Decide whether these statements are true or false.

Q1: The citation of Gary Becker reveals that he belongs to the group of economic imperialists. True

Q2: The citation clearly defines what the methodology and subject area of classical political economy is. False

Q3: The excerpt is exactly what scholars at the Chicago School think about the nature of political economy. True

Q4: Political economy for Gary Becker means a significant broadening of the scope that economists study. True

Q5: Economics cannot be universally applied because human beings are different. False

C)

Q1: Which stream of political economy could provide the proper answer to such a question?

(a) classical political economy

(b) classical economics

(c) new political economy

(d) neoclassical economics

Q2: Why can new political economy address the question above?

(a) Because it assumes that individuals – inclusive of statesmen – are selfish.

(b) Because it assumes that institutions have been adopted in order to achieve a better allocation of resources.

(c) Because new political economy assumes that humans follow their own interests irrespective of the negative consequences.

(d) Because new political economy concentrates on exactly the effective functioning of the political regime and the voting system.

Q3: Among other things, what do we mean by “reasonable men”?

(a) rational people

(b) sensitive people

(c) insensitive males

(d) rational males

Q4: Why is it reasonable to assume that public policies may have harmful consequences?

(a) Selfish, rational men are interested in maximising their own welfare.

(b) Selfish, rational men are hardly interested in maximising the welfare of their society.

(c) Selfish but irrational men are not interested in maximising the welfare of their society.

(d) Selfish but irrational men adopt policies that maximise only their own welfare.

Q5: How should we modify the above question (Q4) if the aim is to adjust it to the need of the neoinstitutionalists?

(a) Why should reasonable men adopt private policies that have harmful consequences for the societies they govern?

(b) Why should reasonable men adopt private institutions that have harmful consequences for the societies they govern?

(c) Why should reasonable men adopt institutions that have harmful consequences for the societies they govern?

(d) Why should reasonable institutions be adopted by public deficits in order to have harmful consequences for the societies they govern?

(D) Please read the following (i) expressions and (ii) statements and decide which of the three neoclassical-based political economy streams they belong to: public choice, new institutionalism or new political economy. (Note: it may be the case that the given expression belongs to more than one stream.)

(i)

Q1: Effective institutions NEW INSTITUTIONALISM

Q2: Rent-seeking activity NEW POLITICAL ECONOMY and PUBLIC CHOICE

Q3: Obstructions to trade NEW POLITICAL ECONOMY

Q4: Rational choice ALL THREE

Q5: Government failures (for more detail see Chapter 3) PUBLIC CHOICE

Q6: Methodological individualism (for more detail see Chapter 3) ALL THREE

Q7: Political organisations (such as the voting system) PUBLIC CHOICE

Q8: Economic institutions NEW INSTITUTIONALISM

Q9: Neoclassical economics (for more detail see Chapter 3) ALL THREE

Q10: Bureaucrats NEW POLITICAL ECONOMY (PUBLIC CHOICE)

(ii)

Q1: The subject matter is the same as that of political science. PUBLIC CHOICE

Q2: A strong normative commitment to unfettered markets. PUBLIC CHOICE

Q3: Economic institutions are the consequence of intentional actions pursued by rational individuals. NEW INSTITUTIONALISM

Q4: Employing public resources to achieve private goals. NEW POLITICAL ECONOMY

Q5: Besides the widely applied methods of economics, the means of other social sciences such as history and sociology have also been incorporated. NONE

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