This learning product reviews the extentto which political economy analysis (PEA) is used to improvethe design of development policy operations (DPOs) and howeffective it has been. Although the World Bank’s mandateexplicitly precludes it from engaging in politics, anunderstanding of the political economy is critical for theorganization’s effectiveness. A political economyperspective broadens the World Bank’s operationalconsiderations beyond technical analysis to the significanceof power relations and the national political processes.This study mostly builds on evaluative findings fromprevious IEG work, including ICRRs, PPARs of long-termprogrammatic series (Tanzania, Vietnam, Uganda, and GhanaPRSCs). Supplementary evaluative evidence was gatheredthrough a portfolio review of randomly selected DPOs,internal PEA reports, and Systematic Country Diagnosticreports (SCDs) relevant for DPOs. The study found that PEAcan improve the design of DPOs by identifying implementationrisks and mitigating action; there are different ways tomake use of PEA; PEA can inform specific design elements,and that PEA can be used in self-evaluations to betteranalyze factors affecting program effectiveness andcontribute to knowledge and improved design.