HistoryNotesFeudalismtoMixedCapitalism - The following...

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The following history lessons are merely an introduction to the topics examined. For more information, refer to the sources. Then refer to the sources listed in the sources. Sources: Clark, Barry. (1998). Political Economy: A Comparative Approach , 2nd ed. Praeger; Westport, CT. Collander, David C (1998); Microeconomics , 4th ed.; Irwin McGraw-Hill; Boston Heilbroner, Robert. (1992) The Worldly Philosophers , 6th ed. Simon & Schuster, Inc.; New York. Heilbroner, Robert. (1996). Teachings from the Worldly Philosophy . W.W. Norton & Company; New York. Landreth, Harry and David Colander. (1994). History of Economic Thought , 3rd ed. Houghton Mifflin Company; Boston. Basic questions each society faces: 1. What goods will be produced? 2. Who will produce these goods? 3. For whom will these goods be produced or how will these goods be allocated? 1. Feudalism: An economic system in which traditions rule. Under feudalism, goods are allocated according to tradition. Why would this be the chosen method of allocation? Consider the following general characteristics: a. Communities were primarily self sufficient. Because transportation over any significant distances was difficult, trade between communities was not common or reliable. Therefore, what ever a community needed the community would have to produce. b. The technology available was primarily labor and land intensive. Production of the necessities of life required both the labor of most able body citizens but also good luck (i.e. good weather). c. Because teamwork was required to produce the necessities of life, people were taught that community was most important, not the individual. Why would this be the case? An individual could not easily both produce the necessities of life or defend what was produced. Therefore, community was necessary for the survival of each individual. d. Economic growth in this system was typically zero. Why? Recall that the factors of production are land, labor and capital. Land could only be acquired via warfare. Increasing labor does not generally improve a communities’ standard of living. [i.e. doubling population may double output, but per person output is the same]. Finally, capital was relatively scarce. So a community could not generally increase the quantity of its factors of production. What about technological change?
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This note was uploaded on 09/21/2011 for the course ECON 33974 taught by Professor Barbaraross during the Spring '09 term at Hawaii.

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HistoryNotesFeudalismtoMixedCapitalism - The following...

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