ECON 234 Final

Question 1

Ways the size of the economy can be measured

Answer 1

world product or output (value added of goods and services produced), expenditures (consumption, investment, government, net exports), national incomes (wages, rent, interest, profit), demographic indicators, economic indicators

Question 2

de jure vs. de facto

Answer 2

de jure: structures of power that are formally recognized in the law; de facto: structures of power followed in reality and in practice but are not officially sanctioned

Question 3

how governments encourage positive externalities

Answer 3

subsidizing goods and services that benefit third parties or give spillover benefits

Question 4

rent-seeking behavior

Answer 4

government uses resources and buys influence (e.g. through lobbying or corruption) to gain rent (e.g. profits and surplus) by reducing the welfare of others

Question 5

Reasons for the growth of population and income in the West

Answer 5

migration through conquest or settlement, international trade or capital movements, technological or institutional innovation

Question 6

Drivers of long-run economic growth

Answer 6

population and resources; commercialization, markets, and technology; class power and property relations; institutional change and property rights

Question 7

institutions

Answer 7

formal and informal rules and norms that determine the way that humans engage in political, economic, and social activity

Question 8

economic institutions

Answer 8

determine the ways and extent to which agents are able to engage in market activities, particularly rules about labor mobility and property ownership

Question 9

political institutions

Answer 9

regulate political power in society, its limits, how its allocated between agents, how it changes hands

Question 10

shirking

Answer 10

unproductivity or neglecting one’s responsibilities

Question 11

social institutions

Answer 11

any rules and norms that regulate social relationships like schools; encompasses both economic and political institutions

Question 12

legal institutions

Answer 12

rules that relate to the enforcement of contracts and rights

Question 13

formal vs. informal institutions

Answer 13

formal: rules and norms that are codified in some formal manner like in statutes, regulations, bills, acts, etc; informal: accepted norms in society and how rules are observed in practice

Question 14

private property

Answer 14

for a private individual, family, group, or corporate body; others excluded without the consent of those who hold the rights

Question 15

common property

Answer 15

more than one person with rights to a resource, business, activity etc.

Question 16

open access property

Answer 16

specific rights aren’t assigned to anyone and no one can be excluded; assumes lack of knowledge of other’s actions and inability to negotiate

Question 17

regulated common property

Answer 17

institutions established to manage entry and exit of participants, quotas, prices, etc.

Question 18

state ownership and/or control

Answer 18

state has exclusive rights to assign access to resources

Question 19

chattel property/slavery

Answer 19

tangible, movable personal property that is not attached to the land

Question 20

sub-infeudation

Answer 20

rulers granted land or “fiefs” to “vassals” like warriors, lords, and knights in exchange for service like military service

Question 21

extensive vs. intensive growth

Answer 21

extensive: expansion in the size of the aggregate economy (labor, capital, land); intensive: increased output per capita or productivity

Question 22

2 types of stock (Smith)

Answer 22

stock used for immediate consumption and revenue-producing stock (i.e. capital)

Question 23

How does capital yield revenue?

Answer 23

can be used in both producing and purchasing goods to be resold with a profit, or in improving land by purchasing machines and instruments of trade

Question 24

Fixed capital

Answer 24

machines and equipment that enhance labour productivity e.g. buildings, improvements of agricultural land, acquired and useful abilities of people

Question 25

growth accounting framework

Question 26

constant returns to scale

Answer 26

increasing input increases output by the same amount

Question 27

neutral technological change

Answer 27

the relative contribution of the factors of production to output is the same; technological changes affects them equally

Question 28

solow residual

Answer 28

contribution of technological progress to output growth can be determined by subtracting the contribution of the other factors of production

Question 29

forced labor

Answer 29

all work or service exacted from any person under the menace of penalty and which the person has not entered into of their own free will

Question 30

type of forced labor

Answer 30

slavery, bonded labor, trafficked people, child labor

Question 31

bonded labor

Answer 31

forced labor for repayment of debt

Question 32

trafficked people

Answer 32

movement through force, coercion, and deception in order to exploit

Question 33

child labor

Answer 33

worst forms include working as soldiers, domestic labor, commercial sex trade

Question 34

Indigenous

Answer 34

born or produced naturally in a land or region; native or belonging naturally

Question 35

Aboriginal

Answer 35

first or earliest as recorded by history; primitive; inhabiting or existing in a land from earliest times

Question 36

First Nations

Answer 36

Indigenous peoples of Canada considered collectively (excluding Meti and Inuit)

Question 37

mode of production (Marx)

Answer 37

method of producing the necessities of life such as food, health, housing; represented by the economic base of society and all institutions that reinforce it

Question 38

traditional

Answer 38

recognizes lands traditionally used or occupied by the Musqueam people or other First Nations

Question 39

ancestral

Answer 39

recognizes land that is handed down from generation to generation

Question 40

unceded

Answer 40

land that was not turned over to the Crown (government) by a treaty or other agreement