The paper primarily undertakes a historical interrogation of the ideological contest between capitalism and socialism, which has significantly shaped the emergence of various political economy concepts central to contemporary development discourse. Adopting a historical approach, the study traces and analyses the major trends characterising the long-standing ideological rivalry between liberalism and socialism, the two dominant orientations in the social sciences. It highlights how this ideological struggle has influenced policy formulation, governance systems, and economic structures across different societies. Based on the findings, the study recommends the need for a balanced, context-driven synthesis of both ideologies to inform inclusive development policies. It also calls for a re-evaluation of rigid ideological adherence in favour of pragmatic approaches that address current global inequalities, promote social justice, and support sustainable economic growth.