The evolving art of political economy analysis: Unlocking its practical potential through a more interactive approach.

Overview • Development practice entails operating in increasingly complex and uncertain contexts to build and sustain relationships between stakeholders who often have sharp differences in commitment, capacity and outlook. Increasingly, political economy analysis (PEA) is being used by development agencies to respond to this challenge. • However, the potential of PEA to inform more radical reform has yet to be realised in full. Doing so entails converting detailed analysis into concrete action at the same time as being more open about the political economy of how development agencies and practitioners themselves operate. • This paper sets out a framework to address this challenge. This means shifting from an ‘intervention’ to an ‘interaction’ model of action that builds on the micro-politics of Machiavelli as much as the macropolitics of Marx. It entails using PEA in ways that are more problem specific, reflexive and agile.