The new political economy approach does not treat a political ideology as a framework that must be analyzed. Rather, it is studied as a set of actions and beliefs. It seeks to make explicit assumptions that lead to political debates about societal preferences.There are three main types of economies: free market, command, and mixed. The chart below compares free-market and command economies; mixed economies are a combination of the two. Individuals and businesses make their own economic decisions. The state's central government makes all of the country's economic decisions.It's an approach that stresses the importance of historical processes, structural forces and institutions in shaping economic outcomes. PE also acknowledges the role values play in influencing what economists choose to study, how they conduct their investigations, and the policy implications of their research.Political economy is a social science that studies production, trade, and their relationship with the law and the government. It is the study of how economic theories affect different socio-economic systems such as socialism. CapitalismIn an economy, socialism.