~10 BIG ideas~ 1) Social Institutions can be _________ 2) US is ______-________ 3) Markets have _______. 4) Collective action problem are _________ and _______s make them worse. 5) Poverty and current levels of inequality are ____________. 6) Revolutions of ____ and _______ are still incomplete. 7) __________ in the US is relatively weak. 8) __________ and imperialism are not sustainable. 9) ____________ challenges, but does not defeat control of our economy. 10) We could do much BETTER!!
~What kind of society do we live in~ 1) High levels of _______ development. 2) Super rich/poor (pick one) 3) What type of capitalism, and explain it. 4) Is globalization growing or slowing? 5) Liberal democratic state 6) Heavily ________ 7) _________ hetrogeneous 8) _________ divided 9) gender inequality, but edroding ____ domination 10) Are we violent? 11) Are we religious?
giant corporations, weak working class organization, small state, high economic inequality
Capitallist Free-market econonmy (2 key concepts)
1) production for the exchange of commodities/ labor on markets 2) private property and private control of surplus and investment out of it Definition: A free market economy is an economy in which the allocation for resources is determined only by their supply and the demand for them. This is mainly a theoretical concept as every country, even capitalist ones, places some restrictions on the ownership and exchange of commodities.
~The US and Militaism~ 1) How much more do we spend than any other country 2) How does this effect our economy?
1) 10 times 2) economy is dependent on military spending, this is a non capitalist, non freemarket aspect of the economy
Violence in the US 1) prisons 2) death penalty
many more handgun murders 25% of world prisoners are ours only country to have death penalty besides Japan and Korea
What is a market?
Why is it so great? (2)
the social proccess through which exchanges of commodities takes place; manmade, way to organize products and value
-Markets are efficient, they positively affect individual freedom
What is capitalism
the economic system in which the means of production are owned by private persons, and operated for profit and where investments, distribution, income, production and pricing of goods and services are predominantly determined through the operation of a free market, rather than by central economic planning. Capitalism is usually considered to involve the right of individuals and corporations to trade, incorporate, employ workers, and use money provided by central banks, in goods, services (including finance), labor and land. In theory, production and distribution in a capitalist system are governed by the free market rather than state regulation, with state action confined to defining and enforcing the basic rules of the market though the state may provide a few basic public goods and infrastructure.
The things you produce for exchange
Extension of the market into spheres previously not governed.
Ex: Making something into a market govened product (house cleaning, child care)
Retreat from market provision
-is the process of viewing utilities as an entitlement, rather than as a commodity that must be paid or traded for. In effect, a decommodified product removes itself from the market
Capitalism is not just a free market society, it has 2 other elements. 1) the means of production are owned _______, not by state or community 2) The labor used in production is obtained through _______ _____ _____ via the labor market
1) privately 2) voluntary market exchange
In Markets 1) consumers express ________ through ______ 2) individuals are given _________ of the good by buying it. 3) If supply differ from demand, the producer will likely _______. 4) Nobody is forced into market exchange, people want to participate
1) preferances, buying 2) exclusive control 3) adjust to the the point that supply and demand converge
once a person buys a product they have exclusive control of it
products given from outside the system
According to defenders of capitalits free market economy, pick which things the state should do out of this list: help poor through incomne support subsidize higher education law and order national defenses provide healthcare enforce contracts prevent "negatvie externalities" provide important public goods like roads and sanitation prevent global warming provide training for unemployed
Things the state shold do: law and order national defenses enforce contracts prevent negative externalities provide important public goods
a doctrine stressing individual freedom and limited government. This includes the importance of human rationality, individual property rights, natural rights, the protection of civil liberties, constitutional limitation of government, free markets, and individual freedom from restraint
laissez-faire economics will bring about a spontaneous order or invisible hand that benefits the society, though it does not necessarily oppose the state's provision of a few basic public goods.[
situation in which the limited resources of a firm are allocated in accordance with the wishes of consumers. An allocatively efficient economy produces an "optimal mix" of commodities.
negative and positive freedoms
Negative freedom means the lack of forces which prevent an individual from doing whatever they want; Positive freedom is the capacity of a person to determine the best course of action and the existence of opportunities for them to realise their full potential.
Negative- freedom from (no one can physically force you to do anything Positive- freedom to - do what you want
2 Reasons markets are BAD
They promote inequality by helping certain races and sexes
They corrode community by encouraging people to move away rather than help each other
2 Reasons markets are pareto-suboptimal
1- short time horizons and collective action problems lead to underinvesment in productive public goods 2-leads to waste, inequality, uncertainty
but markets can help research
doing the most with the least
optimal innovation, risk taking, growth
macro economic efficiency
smooth running of the system, make fullest possible use of productive inputs (keynes) low inflation, low unemployment
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