econ 2200 - Study Guide Test 1

econ 2200 - Study Guide Test 1 - ECON 2200-Moore Study...

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ECON 2200-Moore Study Guide for Test 1 Test #1 will be held in our regular classroom on Thursday, February 1. The test will cover the following sections of the syllabus: I. Introduction: Economic History, Cliometrics & the American Economy Walton & Rockoff, Chap 1 Varian, Hal, “American Companies Show an Edge in Putting Information to Work,” The New York Times , January 12, 2006. Sokoloff, Kenneth L., and Stanley L. Engerman, “History Lessons: Institutions, Factor Endowments, and Paths of Development in the New World,” The Journal of Economic Perspectives , Vol. 14, No. 3, (Summer, 2000), pp. 217-232. II. The Reunification Era: Southern Stagnation, Western Expansion & the Industrial Revolution (c. 1865- 1920) Agriculture and the Farm Protest Movement Walton & Rockoff, Chap 15 1. Describe the development of economic history as a field of study. Give some examples of early scholars whose research combined elements of history and economics. Karl Marx – “the history of society…is the history of class struggles” (1913), Simon Kuznets – won Nobel Prize in Economics in 1921 for method for defining and measuring the components of national income and product accounts 2. Why was Conrad and Meyer's 1958 publication considered a turning point in the study of economic history? What topic is addressed in their paper? Why was their treatment of this topic controversial, and how did their results differ from previous findings, including those of Phillips (1929)? Explain the asset-pricing model and the historical data used by Conrad and Meyer to obtain their results. Disproved Phillips, who claimed that slaves were becoming increasingly unprofitable b/c the price of slaves was rising while the price of cotton was stable. Their model showed that if the price of cotton was stable and the price of slaves were rising, then the only reason for this to happen was if the marginal product of a slave was also rising. Considered a turning point b/c it applied current economic models to historical data to explain behavior. Use asset-pricing model to estimate ROR on slaves, showed that P was rising due to increasing MP so slaves were not becoming unprofitable, disproved U. Phillips, calculates ROR using yield, costs, and risk, compares slavery’s ROR to alternative investments 3. What are the primary features of cliometrics? What is the focus of most cliometric research? Cliometrics is the “new economic history” – uses scientific method/hypothesis testing and applied facts(data) to explicit theory(model); Expanded range of topics; Focus is study and explanation of economic development( How to measure & How to explain) Uses scientific method, focus is study and explanation of economic development (measurement and explaining), attempts to measure the overall well-being of the people in a society, are people better or worse off than before? 4. Use the 5 propositions for economic reasoning from Economic Insight 1.1 to discuss/describe the
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econ 2200 - Study Guide Test 1 - ECON 2200-Moore Study...

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