Microeconomic short essay Neoclassical economy VS Political economy.

You will not need to write more than 3 pages double-spaced.

-Explain the concept of the economic surplus and how different political economic systems shape the nature of class relations (capitalists/workers; slave owners/slaves; serfs/feudal landlords) and thus the ways in which the surplus is extracted. Note: the economic surplus in political economy is not the same as the producer and consumer surpluses in neoclassical economics (as discussed in the Hall and Lieberman textbook).

Key words: surplus profit, employee compensation, replacement and capital goods raw matiral used up, necessary product, total product

-How would you distinguish the neoclassical perspective from the political economy one (Understanding Capitalism chapters 2 and 3)? Summarize what you consider are three or four important differences between the two traditions from Table 3.1 in Bowles et al.

Political economic system key words: slavery, feudalism, capitalism

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