The Greek writers considered both the sciences one and called Economics as Political Economy.
Economics was called Political Economy by the Greeks and was defined by them as the art of providing revenue for the state.”
In modern times, the political scientists and economists have become almost one and are bent upon doing good to human society.
“The new outlook of the welfare State”. Says Professor B. K. Gokhale, “brings together political thinkers, administrators and economists, who plan in collaboration with the larger interests of the State.
The welfare of the people in a state would not be raised if economic principles are divorced from political principles and if economic activities are not regulated by the State.”
In addition to this production and distribution are greatly influenced by the scheme of the government. Economic problems are solved by the State with which Political Science deals in detail. The economic order is closely connected with the political order.
Political order cannot run without the assistance of economic order and the smooth running of economic order is not possible without the assistance of political order. The intimate affinity between political order and economic order comes into light when we study labour legislations, tariff laws, trade, currency and exchange problems.
“The production and distribution of wealth”, says Dr. Garner, “are to some extent determined by the existing forms of government.” “All economic activities are carried within the State on conditions laid down by the State in laws and prevailing theories of state or government functions profoundly affect the economic life of a country.” Political movements are profoundly influenced by economic causes.” says Professor Gilchrist, “economic life is conditioned by political institutions and ideas.”
Influence of Economics on Political Science:
Though the twentieth century economists regard Economics as a separate social science quite distinct from Political Science, it does not mean that there is no intimacy between both the sciences. As a matter of fact, in twentieth century the dawn of the welfare stale has made the inter-dependence of Political Science and Economics more clear than any other concept.
The problems of the modern state are mainly economic problems. If we study ancient history, we shall come to know that the economic conditions had influenced the political affairs. In ancient times when man was passing through Hunting and Pastoral Age, the question of organizing the state or forming the government did not arise because man used to wander from one place to another.
When he entered the age of civilized and cultured life, he started tilling the land and started living in a particular part of the land. By and by the state and the government came into being. But at that time only those people who possessed land ruled supreme.
During the time of Industrial Revolution in Europe, industrialists and capitalists ruled supreme. Now-a-days we can see the influence of a capitalists in the capitalistic countries. The capitalists give wealth to the ruling party and after that they influence the policies of the government in their own way.
Karl Marx has very frankly asserted that economic relationships offer principal key to political relation-ship. The root cause of the French Revolution was economic disparity and this affected the government in a very great measure.
The concepts of Individualism, Communism and Socialism are primarily based on economic principles. But they have brought about revolutionary change in the politics of the government. In nineteenth century, Industrial Revolution led to the manufacture of big machines and to the increase in production. This is the reason why European countries had to find out new market to supply their product. In this way colonialism came into being. Later on colonialists started ruling over those countries.
Joseph Chamberlane, the late Prime Minster of England, once beautifully remarked in this connection, “We shall find our markets in the new countries and shall develop old markets, hence it becomes our duty and a necessity to defend our present empire.” Bismarck, the German Prime Minister from 1866 to 1890, had pointed out, “We were in need of commercial centres more than those new states.”
Adopting the policy of Bismarck the Germans preferred colonies in Africa and later on ruled them. Trade in foreign countries can be successful only when we rule over those countries. The English came to India as traders but later on trade interests compelled them to establish their kingdom in India.
Nazism in Germany and Fascism in Italy came into being due to certain economic causes. The root cause of modern India-China conflict is economic. China cannot tolerate our economic progress and wants to capture our markets in South-East Asia and Africa. Besides, it wants to root out capitalism from India and wishes to spread Communism.
This led to India-China conflict. The root cause of First Great War and the Second World War, which influenced the politics of almost all the countries of the world were economic. Economic conditions influence the foreign policy of all the countries of the world. The Second World War is the glaring example.
After the Second World War, most of the countries of Western Europe and Greece had to seek American economic aid and this is the reason why their foreign policies were much influenced by the foreign policy of America. In the past American Economic Imperialism was very popular in some countries of the world and it considerably influenced the world politics.
Influence of Political Science on Economics:
If economic conditions influence the world politics, world politics also influence the economy of the world. The policies of the government of a country considerably influence the economic conditions of that country. Taxation policy of the government, Import and Export policy, Exchange rates, banking system, Post and Telegraph facilities, Permit and Rationing system. Transportation of goods, Customs Duty, etc., influence the economy of the nation.
The government controls production, distribution, consumption and finance etc. The government runs its industries and imposes heavy surcharge on foreign goods so that indigenous goods sell cheap and sell like hot cakes.
In this way national money will not go to foreign countries. The government controls currency and coinage and the exchange of money. The government resolves the differences between the labour and the employers. If the government of a particular country is socialistic, its policy of private property and capital will be different from that of capitalistic country.
The nationalization policy of a particular country considerably affects the economy of that country. Like-wise, the government adopts various measures to check the rising prices and takes various steps for increasing production. After Partition in 1947, Indian Government chalked out many plans and took many important steps in various fields.
Our government took many important steps and adopted various measures for increasing the agricultural production. It constructed dams, floated loans on easy terms and gave impetus to co-operative farming. For increasing the industrial production, our government ran a number of factories, mills and installed many plants.
In the modern times with the growth of behaviouralism, the importance of economics has increased considerably because political scientists are making attempts in the application of models borrowed from economics which have been widely accepted. Secondly, a large number of political scientists are recording their findings in statistical terms. Therefore Otto Davis, an economist, has introduced a term political econometrics.