Exam 1 Flashcards
(168 cards)
1
Q
why are countries poor
A
there is no one reason why some countries are poor
-poverty is a very complex issue
2
Q
How many children die uneccesarily
A
every hour more than 1000 children die unecessarily
3
Q
what couses most childhood deaths
A
- Dysentery ( caused by bacterial, pasasitic, or protozoan infection
- ) pneumonia
4
Q
what happens once children become affected by dysentry or pneumonia
A
they cannot process nutrients leaving them culnerable to other infections
5
Q
what is GDP
A
GDP is is market value of all goods and services produced within a territory or country
6
Q
what does GDP stand for
A
gross domestic products
7
Q
what is GDP per capita
A
income per person
8
Q
how do you solve for GDP per capital
A
take your total GDP and divide it by your population
9
Q
what tool can be used to solve for GDP
A
- Market exchange rate
2. PPP ( purchasing power parity)
10
Q
What is PPP
A
purchasing power parity adjust for the difference in purchasing power between say the US and a poorer country
ex. usually a dollar has more purchasing power in a poor countri. US buy one. Mexico buy three
11
Q
what is GDP usually expressed at
A
GDP is usually expressed in US Dollars
12
Q
what can the market exchang rate be used for ?
A
to convert foreig currency into US dollars
13
Q
what is the downside of using the market exchange rate to solve for GDP
A
one rate is being applied to everthing as a hole.
-if you dont pick the correct rate then it is not accurate
14
Q
how do you caculate another countries GDP in US Dollars using the market exchange rate
A
- divide the sales price for both countries
- this means the ex 35 rupees equals one dollar
- take total GDP of the country and divide by Rate
15
Q
how do you calculate PPP adjusted GDP
A
- find the foreign quantities produced
- ) multiply quantities by US Prices
- ) add up the numbers
16
Q
who makes us the mojority of the worlds riches 1%
A
the united states
17
Q
How do we distinguish between developed countries
A
- the world bank scheme
* ranks the countries on GDP per capita
18
Q
describe the different ranks of the world bank scheme
A
- low income comuntries
- lower middle income countries
- upper middle income countries
- rich countries ( organizations for economic cooperational development)
19
Q
after what amount of money per year does it not increase happiness significantly
A
60,000
20
Q
what is HDI
A
answers the questions of how many people are healthy, reasonably wealty and wise ( education )
21
Q
whatdoes HDI take the weighted avrage of
A
- Health
- Life expectancy
- Education
22
Q
what has happened to the number of people living in absolute poverty
A
has remained the same
23
Q
what has happened to the number of people living in poverty
A
- it has gone down significantly
24
Q
what is the history of economic growth
A
- economic growth is a recent phenomenon
25
which is more popular to measure well being?
- GDP at PPP i more popular
| - GDP data more frequently available
26
when did growth really begin to take place
until about the 1750's 1800
27
why did europe growth so fast from 1750-1800 and after
the industrial revolution
28
what was the pre-galileo world
- aristotle belived that the earth was the center of the universe
29
what were the ideas of aristotle
- the earth did not move. celestial bodies circled the earth
- the earth could no progress or move -
30
when did the idea of progress start taking place
in the post galileo world
31
is it probably not possible for a country to what?
experience economic development without economic growth
32
how many people out of ten have electricity in their homes
8
33
what did plato belive
he claimed that history was always being repeted
- Had a 36000 year cycle
- ex. 36000 years of glory , 36000 years of decline
34
what was the idea of nitzche
- eternal recurence
- if time is infinate that everything wwas could happen has already happened so we must eternally be repeating everything in our livesm
35
what idea exist in most religions
the idea of cycel exist in most religions
| -there is no concept of progress ex. christianity, budhism
36
what did st. augustine propose
- he proposed the doctrine of original sin ( because your original parents sinned, everyone is a sinner)
- all religions agree that the apocolipse would end the world
37
what were the ideas of david hume
claimed that like humans all civilizations hay youth, maturity and old age
38
did charles darwin belive in progress
-charles talked about evolution not progress
39
what are the complex roots of economic development
1. Geography
2. evolution
3. history
4. crop patterns
5. agriculture
6. germs
40
what is the most important this for economies to have in order to prosper
- internation trade
41
what is an important factor when looking at trade
transportation cost
42
which form of transportation is the cheapest
- ocean/ river transportation
43
what are hydraulic civilizations
civilizations close to waterways did better
| -better access to cheaper trade thus they prospered
44
describe the statistics behind being close to water and and the GDP
- 17 % of total land mass is within 60 miles of oceans/ waterways
- 50 percent of the people living on this land hold over 67 percent of the worlds GDp
45
where aremost economic growth centers located
- most economic growth centers have been close to rivers and oceans
46
why is sub saharan africa so poor
lack of access to river or oceans
47
what is the defference between europe and Africa
- Africa- only 21 %has access to the ocean
| - europe which is 1/8 the size of Africa has 50% more coastline
48
what is transportation cost also dependent on
- dependent on proximity to major economic centers
49
what is growth clustering
occurs when one area becomes economically
| -africa has very few clusters
50
does africa have alot of rivers?
africa has very few rivers and it is a very large continent
51
why did jared diamond take a look at 13,000 years of human history
- because that was when the ice age ended
52
what does gared diamond say is the reason why eurasia develop rather than africa
-geography
53
what is the evolution of civilizations according to jared
-domesticatable animals & crops --> agriculture --> cities and civilizations --> guns
54
what did agriculture and domesticatable animals develop
germs
55
what are the five major domesticatable animals in the world today
1. sheap
2. goats
3. cows
4. pigs
5. horses
56
what the the total number of domesticatable animals that we have today
14
57
were the ancestors of domesticated animals spread eveny
no
| -none of the ancestors was indegenous to sub-saharan Africa
58
wat did not having domesticated animals do
was much harder to develop mass gricultures and form cities and civilizations
59
what accounts for 41 % of the total calories consumed in the world
1. wheat
| 2. rice
60
where is wheat native to
the fertile crescent around modern turkey and iraq
61
where is rice native to
china
62
what happens to agriculture in torrential rain
- torential rain in tropical regions washes away the nutrients from the soil
63
what happens to agriculture in temperate regions
mild frost is temperate regions is better because the water works like a drip system
64
what led to eurasia in particular to develop agriculture
- the uneven distribution of domesticatabl plants and animals
65
why did agriculture and other ideas spread faster in eurasia
because its major axis is east-west along a similar latitute meaning a similar climate
66
does having a north- south axis make the spread of ideas faster?
-no the north to south axis means different climates so things that thrive in the north might not thrive in the south
67
where do major infectiour diseases evolve from
animals
- small pox
- flu
- tuberculosis
- malaris
- lague
- measels
- cholera
68
what main disease killed the people of the new world
small pox
69
why did europeans have a more difficult time conquering asia and africa
malaria
70
summarize the diamond argument
1. east- west axis
2. ease of species preading
3. domesticated plants and animals
4. food surplus and storage
5. large stratified societies
6. technology --> guns , ocean- going ships
71
what is the difference btween italy and pakistan in regards to malaria ecology indice
because italy has better health policies
72
where is it easier to eradicate malaria
isolated islands
73
where is most of the world poverty
around the equator- due to heatness
74
what can have a damagin effect in poor countries
- higher temperates
- global warming increase gap between between rich and poor
- slower economic growth
75
what was the effect of the introduction of air conditioning
- it allowed people to continue working even in hot temperatus
- it is earlier to deal with the coldness ( cheaper to keep warm) that with hotness.
76
what is the relationship of latitude( distance from equator) and and GDP (incope per capita)
the further you are away from the equator the wealthier you are
77
what is the relationsihp between latitude and agricultural GDP per worker
the further you are away from the quator themore you make in the production of crops
78
what does cleaopatras nose theory argue
that chance plays abig role in hostorical outcomes
79
what does Carr ask
can such accidents determine history in a complete random fashion or can we predict an underlying force tgat shapes history
80
what did francis fukuyama belive
- francis fokuyama has his great cause which which is the inevitable predominance of liberal democracy and capital
- ex. the sum of millionsof human wishes if one thing does not bring change then another will
81
which tropical diseases had had the greatst impact on economic growth
malaria
82
what is a resource curse
in the long run the prescence of natural resources can impede economic growth
83
what was growth accompanied by
1. indistrialization
2. capitalism
3. urbanization
4. individualism
84
what were some characteristics of pangea
- all the continents were originally together
| - all countries were similar in terms of low income but then they moved apart
85
what was the originic of economic growth
the fertile crescent
86
how long ago did economic growth begin in the fertile crescent
250 years ago
87
what happened as income started growing
- industries developed
- industrial technology developed
- agrigultural technology developed
- people move from agricultureto society
- indistries started hiring people
- domestic and international trade became sign ificant
- people noticed that life was changing
- theories of growth began after growth started
88
what does agriculture need to do
Agriculture must create surplus to support
industrial workers. Industrial workers must
depend on food surplus from agriculture.
89
how can you create agricultural surplus
Agricultural surplus may be exported. So trade
| became a significant factor behind growth.
90
what can idustry do
can produce tools to increase surplus
| -so a mutual relationship developed
91
what was done with inustrial goods and agricultural surplus
Industrial goods and agricultural surplus may also be exported. So trade
became a significant factor behind growth.
92
what started forming as income started growing
classical theories of growth
93
describe how trade connects agriculture and industry
- industry muts buy agricultural products to feed the workers working in the industry
- augricultural workers must demand industrial products to make production worthwhile
- industry and agriculture must trade goods between sectors
- thus all three must work toghether to make economic development possible
94
describe the agriculture, trade and industry relationship
- agriculture must ceate surplus to support industrial workers
- workers must depend on on surplus from agriculture
- industry can produce toold to increase agricultural surplus
- -> amutually relationship developed
95
how do you achieve economic development
all three, agriculture, industrial and trade must work together to make economic deveopment possible
96
what are the three musketeers of development
1. agriculture
2. trade
3. industry
97
what were the three political disticts groups formed to suppor the three sector
1. Physiocrats
2. mercatalist
3. Marx
98
what did physiocrats believe
they thought that agriculture was the crutial determinant o fgrowth
99
what did mercantilist believe
-they thought trade was the primary force behind economic growth
100
what did marx believed
-places supremacy on industry
101
what spawned capitalism
it was spawned by industry ( marx)
102
what prevented international trade inittially
-high transportation cost
103
what happened as transportation cost started going down
-it was possible for agriulture and industry to develop in rural and urban places with thrade in between
104
what wa sone of the most important conduit for both agriculture and industry
-trade
105
where did economic growth seems to have almost always occured
in places close to rivers
106
did international trade existi before ocean shipping
-yes the silk route
107
when did international trade really thrive
hen alternative shipping points were developed on the sillk route
108
why did europe develop better than poorer countris
- longer coast lines
- better shipping
- europe had simultanous agricultural and indutrial revolution
109
where were countried developed along
the fertile crescent
110
describe the US shipping and trade
- the erie canal which linked albany to buffalo boosted trade
- the robert fulton clemont steamboat made shipping much easier
111
what brought properity through trade
command over water and steel ( rail lines)
112
what were some of the most important trades interntionally y
perume and spice because transportation was relatively cheap
- . ex. no spoilage
- easy to carry
113
what one of the earlierst motives for for international trade
the spice trades
114
what were the three spices that changed the world
1. nutmeg
2. mace
3. cloves
115
what island were the spices collected from
- the maluku islands near papua new guimea
116
what tool changed the world
the harrison clock
| -shipping beacme easier
117
who was zhng he
- cheng hes explorations made chinese trade possible
118
why didnt china prosper as much as europe if china was so good in land and ocean exploration
because china decided to close its borders and become a close economy
- become a near autarky ( self sufficinet)
119
during what centure did china did not presper
-during the 18th and 19th centuries
120
what did china ultimately claim for why they were closing its borders (1792)
- china claimed that they were better at everything
| - -> because of this they avoided immediate colonization but chinas decline started after 1792
121
when did chinas progress begin
in the 1980s once they opened up for trade again
122
how ong did china had to wait to ship goods to the rest of the world
600 years
123
what did physiocrats belive was the source for all growth
mother nature
124
what did physiocrafts belive the formula for surplus was
since input and output units are the same
output-input = surplus
-more surplus = more growth
125
who did physiocraft belive the governemnt should support
farmers
- indutry mearly transformed products it did not create products
- they though indutry was sterile
126
who was the most facour physiocrat
francois quesnay
127
are the physiocrats correct
-no at one point engalnd prospered ith only 3% of wealth from agriculture
128
what did mercatilist believe
they thought trade, spcifically exports created wealth
129
how did european merchants look at international
| trade
they looked at international trade as a source of PERSONAL wealth
- more exportrs equal more gold for the merchants
- exports are good and imports are bad
130
what is the ultimate claim of mercantilism
-trade is a zero-sum game where exporters win and importers loose
131
what is the dowside to export surplus
-more gold circulates inside the exporting country --> prises rises --> exports fall --> export surplus falls
132
who was one of the most influencial economist of industry
marx
133
what did marx believe
be though capitalim is immensly better than feaudalism
134
according to mark what was capitalism synonym to
industrialization
135
what did hunting and gathering societies turned to as described by marx
feaudal societies
136
describe the primitive communism to feaudalism
- hunting and gathering societies collapsed as agriculture became more important. land ownership became important
- land ownership led to exploitative feaudalism
-under feaudalism land owners became important
- Feudalism created a rent-seeking system that
did not encourage free entry and free exit.
137
introduction of capitalism
- - cities and industries started developing
- capitalist wanted workers
- landlords had to let their workers move to factoris
- conflict between feadalism and capitalim
- capitalist made profit by increasing output
138
what is the difference between faudalism and capitalist
- feaudalism - rnt seeking society
| - capitalism - profit- seaking society
139
what did marx think would eventually happen to capitalism
-it would evnetually collapse because there would be severe demand shortages ( recessions) and capitalism would give rise to socialism and communism
140
what is marxian long view of history
1. hunting and gathering society
2. feaudalism
3. capitalism
4. socialism
5. communism
141
what is the prime mover in the marxian growth model
labor
142
what does labor add in the marxian model
value
143
what does the variable of V stand for the marz analytical framework
- value of labor power
- variable
- time needed to sutain worker plus time to make product
144
what does the variable of C stand for the marz analytical framework
- C is a constant since according to marx machinery mearly transferred it value to output
145
what does the variable of W stand for in the marz analytical framework
- the total value of production
146
what does the variable of S stand for the marz analytical framework
- surplus value
| - teh difference between what the worker is paid and the number of hours the worker actually works
147
what creates the value of surplus
-it is created by labor power
148
what is the value of any production
W=C + V + S
149
wht is the formula for the net value ofproduction
Y=V+S
150
according to hodgson what is the profit rate if t is the turnover rate
S/( K + T(C+V)
151
When would a company achieve maximum profit
when V is close to zero ( worker gets paid very little) and turnover rate is really high
152
what is the formula for maximum profit
S/K = Y/K
153
according to marx what would happen as capitalism progresses
capitalism will increase capital and intensive production will happen and Y/K will cal
154
what do modern economy currently use instead of the max labor theory of value
-marshallian marginalist principles
155
what is one of the fundamental ways in which people behave under capilasim
only economic means, not feaudal violence was used to achieve ones goals
156
what was smiths theory of growth
smith invisible hand of the market created prosperity
157
what was smiths main idea
productive labor creates value
158
described adam smiths theory of growth
- productive labor can specialize and increase productivity
- productio - broken down into mutiple processes ( specialization )
- specialization and division of labor increases efficiency
159
what are the two conditions for smith theory of growth
- one must have a large enough market
- large countries with large internal markets will perform well
- small coutnries with with access to international markets will also perform well
160
what was the prime mover in smiths model
-technology which depended on market size
161
what did smith divide labor into
productive ( manufacutring, labor, produced something) and unproductive labor ( not tangible such as singing)
162
describe the schematic model of growth for smith
1. labor ( productive and unproductive)
2. division of labor
3. better technology
4. higher GDP
163
Compare marx and smith
for marx: maximum profit was Y/K
| For Smith: profit determined by extent of market Y/K will rise as market expands and technology becomes better
164
what is smiths theory of moral sentiments
it shows that our moral ideas and actions are a product of our very nature as social creatures
165
what are some theories of why feaudalism collapsed - mcclelland
need for achievement
N-ach
-the degree to which someone is motivated to set and reach goals. People with a high n Ach are usually driven to succeed for internal reasons such as personal satisfaction rather than by external pressures.
ex- jews and saving
166
according to max webber what was capitalism defined as
Capitalism is defined
by an orientation toward economic activity
characterized by rational systematic pursuit of
economic gain by purely economic means.”
167
Why did max believe that protestants become good capitalist
people of teching of their pastir john valacin
168
what did robert barro and rachel McCleary find out
- economic growth correspons positively to the extend of believes but negatively to church attendance.
- believeing rathre than belonging
