Economics 258

Intermediate Political Economy

Bucknell University

Spring 2002

Prof. Geoff Schneider

Office Phone: 577-3446

Office: 171 Coleman Hall

Office Hours: M W F 11-12, T 2-3

and by appointment.

Email address: gschnedr@bucknell.edu

Web page: http://www.facstaff.bucknell.edu/gschnedr

• Prerequisite: Economics 103 or permission of the instructor.
• This is a writing-intensive course that counts as a W2 course at Bucknell.

Course Description

The purpose of this course is to study some alternative ways of thinking about economics and the economy. The basic premise of the course is that our current capitalist economic system has many flaws, and these flaws are not addressed adequately by mainstream economics. Mainstream (or neoclassical) economics focuses on prices, markets, allocative efficiency, and modeling the economy. Many mainstream economists prefer organizing economic activity via a largely unregulated market system based on self-interested behavior and private property. But mainstream economists have little to say about many of the crucial economic issues of today: social disruption, commodification, increasing inequality, longer work weeks, globalization, technological change, unethical corporate behavior, overconsumption, the destruction of the environment, discrimination, and the instability of financial markets. Meanwhile radical economists, using the ideas of Marx and Veblen (among others), have much of value to say about these topics. In essence, radical economists set out to answer a different set of questions, questions that go to the heart of the negative side of our global capitalist system.

In this course, we will examine how the works of Marx, Veblen, and contemporary political economists differ from those of neoclassical economists, both in terms of theoretical approach and in terms of the questions that are addressed and the solutions that are proposed. As such, this course satisfies the Political Economy requirement for the economics major.

The course is divided into four sections. During the first part of the course, we will investigate Marxist political economy, reading selections from Marx's writings as well as some contemporary works of Marxist political economy, including works that explore the Social Structures of Accumulation of US capitalism. The second part of the course will deal with applications of Marxist political economy to current issues, including the living wage, social classes, the environment, the role of markets, and the financial sector. The third part of the course will investigate Institutionalist Political Economy and the ideas of Thorstein Veblen, along with a contemporary work in the Institutionalist tradition by Juliet Schor. The final section of the course will lay out some alternatives to capitalism that are advocated by political economists.

Texts:

1) Baiman et al. Political Economy and Contemporary Capitalism (PECC). Armonk: M. E. Sharpe, 2000.

2) Zweig, Michael. The Working Class Majority: America’s Best Kept Secret. Ithaca: Cornell University Press, 2000.

3) Barbara Ehrenreich. Nickel and Dimed. Metropolitan Books, 2001.

4) Veblen, Thorstein. The Theory of the Leisure Class. New York: Dover (1994).

5) Schor, Juliet B. The Overworked American. Basic Books (HarperCollins) (1991).

6) Email Readings: I will be sending you topical readings throughout the semester. You will need to check your email Monday and Wednesday and read the material I send to you.

7) E-reserve Readings: There are a number of readings on e-reserve at the library home page.

Grading:

Examinations	45%
Class Participation	10%
Readings Journal	20%
Term Paper	25%

Examinations (45%): There will be two take-home exams. Exam #1 is worth 20% of your grade, and exam #2, which covers more material, is worth 25% of your grade. The best way to prepare for the exams is to do a good job on the readings journals, so that you can refer back to them when you answer the exam questions. The exams will be testing your ability to apply the theories we have to studied to various issues and your ability to engage in a sophisticated critical analysis of the material.

Class Participation (10%): This course is an exercise in collaborative inquiry, in which we all delve into the subject of political economy. Thus class discussions are a crucial component of the course, and I expect every student to read all assignments on time, come to class, and participate actively in discussions. Your participation grade will be based on attendance and on the quality of your in-class comments about the readings.

Readings Journal (20%): There are 25 course meetings that require you to read from the books listed above or from an article on electronic reserve. Each day that you are assigned readings, you should prepare a short (at least ½ page, typed, single spaced) analysis of the readings, in which you evaluate the author's main points and express your own opinion. To allow you some leeway, you may miss up to 5 journal entries without penalty (so I am expecting a total of 20 journal entries over the entire semester). Your journal grade will improve if your comments are particularly insightful or creative. You are encouraged to express your own opinion, and you will not be graded on the opinion you express, only on the quality of your analysis. Journals are due at the beginning of each class. No late journals will be accepted. Early in the semester I will ask for specific things in your journals. As the semester progresses I will allow you greater latitude.

Term Paper (25%): Each student will undertake an independent research project and write an 8 page term paper on that research project. Your term paper is due at the end of classes, but I strongly recommend that you complete your term paper well before that time. The term paper will be done in several stages, including the development of a list of sources and a rough draft.

Course Calendar:

Th Jan. 17	Introduction
Readings: Syllabus. Film: Money For Nothing: Behind the Business of Pop Music.
Section I: Marxist Political Economy and Social Structures of Accumulation In this section of the course we will start by exploring how political economy is distinct from neoclassical (mainstream) economics. Then we will take up the key ideas of Karl Marx, which form the foundation of the radical approach to political economy. Subsequently, we will study Social Structures of Accumulation, which is a contemporary application of Marxist ideas to the US economy. The purpose of this first section is to get you to understand the theoretical core of Marxist political economy. The first take home exam will test your ability to understand and apply these theories. The best way to prepare for the exam is to work through the readings carefully and to develop your ideas in your journal entries.
T Jan. 22	The Political Economy Approach to Economics J1
Readings: 1) Bowles & Edwards, Ch. 2, “A Three-Dimensional Approach to Economics” (e-reserve). 12 pages 2) Cassidy, “The Decline of Economics” (e-reserve). 7 pages 3) PECC, Ch. 3, “The Methodology of Radical Political Economics.” 4) Hightower, “How Ya Doin’?” (e-reserve). 3 pages
Th Jan. 24	The Father of Radical Political Economics: Karl Marx J2
Readings: 1) Hobsbawm, “Introduction to the Communist Manifesto” (e-reserve). 2) Marx & Engels, The Communist Manifesto, Sections I, II and IV (e-reserve). 3) Sackrey & Schneider, “The Marxist System” (e-reserve), Part I only.
T Jan. 29	Surplus Value and Social Structures of Accumulation J3
Readings: 1) Sackrey & Schneider, “The Marxist System,” Part II (e-reserve). 2) Bowles and Edwards, Ch. 7, “American Capitalism: Accumulation and Change” (e-reserve).
Th Jan. 31	American Capitalism J4
Readings: 1) Bowles and Edwards, Ch. 18, “American Capitalism: Long-Term Growth and Stagnation” (e-reserve). 2) Bowles and Edwards, Ch. 17, “Limits of Democratic Control of the Capitalist Economy” (e-reserve).
T Feb. 5	Are Our Corporations Fat and Mean? J5
Readings: 1) Gordon, “Underpaid workers, bloated corporations” (e-reserve). 2) Hightower, “Getting A Leg Up on Corporations” (e-reserve). 3) PECC, Ch. 8, Moseley, “The Rate of Profit and Stagnation in the US Economy.”
Th Feb. 7	Alienation J6
Readings: 1) Marx, “Estranged Labor” (e-reserve). 2) Ehrenreich, Introduction and Ch. 1.
T Feb. 12	Social Class J7
Readings: 1) Ehrenreich, Ch. 2. 2) PECC, Ch. 5 and Ch. 6.
Th Feb. 14	Inequality and Class Struggle J8
Readings: 1) PECC, Ch. 12 and Ch. 14. 2) Ehrenreich, Ch. 3.
T Feb. 19	Why Unions Matter J9
Readings: 1) Yates, “Why Unions Matter,” (e-reserve). 2) PECC, Ch. 16. 3) Ehrenreich, “Evaluation.”
Th Feb. 21	Exam Due at the beginning of class
Film: Constructing Public Opinion: How Politicians and the Media Misrepresent the Public
Section II: Applications of Marxist Political Economy In this section of the course, we will use the theoretical tools developed in the first part of the course and apply them various contemporary issues, including class structure, the environment, financial markets, and feminist political economy. As we explore these issues, you should be thinking about a term paper topic.
T Feb. 26	The Class Structure of the United States J10
Readings: 1) Zweig, Introduction and Ch. 1-2.
Th Feb. 28	The Importance of Class Analysis; The Underclass J11
Readings: 1) Zweig, Ch. 3-4.
T Mar. 5	Values, Power and Class J12
Readings: 1) Zweig, Ch. 5-6. 2) Madrick, “Living Wages are Practical” (e-reserve).
Th Mar. 7	Globalization, Democracy and Class J13
Readings: 1) Zweig, Ch. 7-9. 2) Krugman-Pollin debate on the living wage (e-reserve).
Spring Break, March 9-17
T Mar. 19	Capitalism, Mainstream Economics, and the Environment J14
Readings: 1) John Bellamy Foster, The Vulnerable Planet, Ch. 6-7 (e-reserve).
Th Mar. 21	Financial Markets: How They Work and For Whom J15
Readings: 1) Kuttner, Ch. 5, “Money Markets and the Corporation” (e-reserve). 2) Henwood, “Wall Street: Class Racket” (e-reserve). 3) PECC Ch. 20.
T Mar. 26	Feminist Political Economy J16
Readings: 1) PECC Ch. 4, 7, 13, 32. 2) Schneider and Shackelford, “10 Principles of Feminist Economics” (e-reserve).
Th Mar. 28	The Welfare State J17
Readings: 1) PECC Ch. 29, 30, 33, and 35.
Section III: Institutionalist Political Economy In this section of the course, we will explore the ideas of Thorstein Veblen and the Institutionalist School of economics that he founded. Make sure that you keep track of the similarities and differences between Marxist and Institutionalist political economy as we explore these ideas.
T Apr. 2	An American Radical: Veblen and Evolutionary, Institutional Economics J18
Readings: 1) Knoedler, “Thorstein Veblen” (e-reserve). 2) Veblen, Ch. 1.
Th Apr. 4	Veblen, Consumerism and Overwork J19
Readings: 1) Veblen, Ch. 2. 2) Schor, Ch. 1-2. 3) Collins et al, “The Wage Gap Underlies the Wealth Gap” (e-reserve).
T Apr. 9	Why Are Americans Working Longer Hours For Less Pay? J20
Readings: 1) Schor, Ch 3-4. 2) Veblen Ch. 3. 3) Baxandall & Breslow, “Does Inequality Cause Overwork?” (e-reserve).
Th Apr. 11	Wasteful and Destructive Capitalism: The Sales Effort
Readings: 1) Schor, “Introduction to The Overspent American.” Film: “Advertising and the End of the World.” Draft of your term paper is due on Friday, April 12^th by 5PM.
T Apr. 16	The Insidious Cycle of Work-and-Spend J21
Readings: 1) Schor, Ch. 5. 2) Veblen, Ch. 4-5.
Th Apr. 18	Pecuniary Culture: Can It Be Stopped? J22
Readings: 1) Veblen, Ch. 6-7. 2) Schor, Ch. 6.
T Apr. 23	The Nature of Capitalism and Capitalists J23
Readings: 1) Veblen, Ch. 8-10.
Section IV: Alternatives to Capitalism Since political economists are quite critical of capitalism, a useful way to end the semester is by studying the alternative methods of economic organization that political economists favor. We will investigate alternatives to capitalism at the macroeconomic level in terms of the organization of the entire economy and at the microeconomic level in terms of the organization of firms and communities.
Th Apr. 25	Democratic Socialism and Social Democracies J24
Readings: Choose One of the following two readings: 1) Schneider, “The Middle Way: Swedish Social Democracy” (e-reserve). 2) Visser and Hemerijck, A Dutch Miracle, Ch. 1-2 (e-reserve).
T Apr. 30	A New Model of Business Enterprise: Mondragon J25
Readings: 1) MacLeod, From Mondragon to America, Ch. 1-2 (e-reserve). 2) MacLeod, “Mondragon, A New Model,” (e-mail). 3) Schumacher, “Buddhist Economics” (e-reserve).
Term Paper Due Date: Wednesday, May 1st at 5PM.
To Be Announced	Take Home Final Exam