ABSTRACT
This introduction presents an overview of key concepts discussed in the subsequent chapters of this book. The book establishes the intellectual and historical context of the political economic approach. It discusses how a capitalist economy would be organized if it were in economic equilibrium, and examines the reasons why such an equilibrium cannot be sustained, and the theoretical implications that stem therefrom. It also discusses the emergence of political economy in the first part of the nineteenth century, the very different nature of neoclassical economics that followed it, and the subsequent revival of interest in a revamped analytical political economy during the last twenty-five years. The book presents a model of general spatial equilibrium, one in which there is full competition among capitalists, implying the profit rates are equalized across all sectors. It reviews both fundamental Marxist and neo-Ricardian theories of differential rent.
