"Political economy" studies the interplay between politics and economic processes. It examines how governmental policies, institutions, and power dynamics influence economic performance and resource distribution. Political economy considers both macro and microeconomic factors, exploring how political decisions impact economic outcomes and vice versa. This field analyzes various aspects such as trade, regulation, and labor relations within different contexts, including capitalism and socialism. By understanding the connections between political and economic systems, political economy provides insights into policy effectiveness and societal development, addressing issues like inequality and sustainability.