ABSTRACT
Economic conflicts are resolved in the political system, where policies are shaped by party politics, legislative processes, and the push and pull of different interest groups and the votes and money behind them. The academic field of political economy differs from the fields of public finance and public economics, both of which focus on policy analysis instead of politics. Federal policies also owe some of their complexity to other features of America’s political system, like federalism or the separation of legislative and executive powers. Political parties also enhance governance by allowing voters to hold politicians collectively accountable. When Barack Obama and congressional Democrats pushed for those provisions many of those same Republicans came out against the reform, having calculated that opposition was a better political posture vis-a-vis the Democrats. The chapter also presents an overview of the key concepts discussed in this book.
