The logic behind the emergence of an economic power paradigm

Economics requires basic assumptions that are linked to basic methodology. In other words, basic assumptions can best reflect the philosophy and methodology of economics, which is the logical starting point or theoretical premise that an economic system relies on. The assumption of economic man is a fundamental assumption in economic theory and the basis of the Western market economy framework. Without this assumption, there would be no market economy theory and market economy system.

Any type of economic analysis should be based on the behavior of subjects of economic activities. The design and arrangement of an economic system rely on assumptions about the nature of these subjects. Therefore, according to the assumption that economic power is everywhere in the economy, we propose the notion of “power economic man,” based on the assumption of economic man, to reflect economic activities in the real world. Human economic activities are relational activities among different economic subjects. The pursuit of profit maximization is achieved only through production, exchanges, consumption, and distribution. The pursuit of profit maximization is a claim on nature but also a claim on distribution. We believe that economic power is the ability of an economic subject to affect others to achieve their goals under the condition of having sufficient productive resources at their command. The concept of economic power is a relational concept. An individual has no power alone. Only in the exchange process can the mutual influence of power be reflected. The premises of human economic activities are exchange and labor division. The need to work with others, as well as the influence of an individual’s power over others, emerges in the process of exchange and labor division. In the following sections, we discuss the content and rationality of power economic man from the perspective of the development and logical path of economic man assumptions.

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