The post-modern political economy emerged in the late twentieth century exhibit five attributes: globalization, digitization, entanglement of modern and postmodern issues, de-differentiation and self-expression. These attributes gradually strip away the explanatory power of traditional theories of political economy. This paper argues that a theory of post-modern political economy should incorporate elements of interdisciplinary analysis, multi-level analysis, value judgment, policy reform, story-telling and new institutionalism. Seven practical steps of new institutional analysis are recommended to study issues of post-modern political economy. Based on this new approach, this paper exposes the weaknesses of the developmental state theory and proposes instead the developmental institution theory.