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Riley Moore test


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David Ricardo
Classical School 1772-1823 stockbroker and rich man in England claimed people exaggerated importance of events
1817- "principles of political economy and taxes"
David Ricardo
1797 people unable to...
exchange paper money for gold because of war between england and france
rent (ricardo's version)
is that portion of the produce of the earth, which is paid to the landlord for the original and indestructible powers of the soil.
law of diminishing returns
If one factor of production is fixed and increasing quantities of the other factors are combined with it, then the average physical output in relation to the fixed factor will eventually diminish. Alternatively it can be said that for each addition to the variable factor or factors the addition to total output declines
functional distribution of income
A concept that preoccupied Ricardo in which he analyzed the relative shares of a nations yearly output going to labor, land, and capital.
Labor [cost] theory of value
The view that the value of a commodity depends on the labor required to produce it.
real wages
Wages in terms of the goods and services the money wages will buy
corn laws
British regulations covering trade in grains, in force from 1436 to 1846. Heavy import duties were levied on grain imports for home consumption since the domestic price remained below a stipulated figure. Agitation against such regulations became particularly intense after 1837, and led to the repeal of the laws.
Marxian socialism
Based on the labor theory of value and theory of exploitation of the wage earners by the capitalists. Argued that capitalism faced class struggles and contradictions that inevitably would lead to its being overthrown and replaced by socialism. Private property in consumer goods is permitted, but the capital and land are publicly owned by the central government.
The stage of society that replaces socialism. The state will wither away when antagonistic classes disappear, and government over people will be replaced by administration over things such as large railroad systems.
Abjured the class struggle; denied that the state is necessarily an instrument of the wealthy class; and pinned its hopes on education, electioneering, and gaining control of government through the ballot. Government was to regulate monopolies, control working conditions in factories, take over some public utilities, and gradually extend its ownership of capital.
Anti-parliamentarian and anti-militarist. Believed that socialism deteriorates into bourgeois beliefs when it engages in political and parliamentary activity. Workers need one big union that through striking will overthrow capitalism. Differed from anarchism in that the former relied exclusively on revolutionary unionism and the general strike for the overthrow of government. However, both were for the abolition of private property and extinction of political government.
Guild socialism
Accepted the state as a necessary institution for expression of the general interests of citizens as consumers. The actual management of industries was to be entrusted to the employees (the producers), organized in their industrial guilds, rather than to the government. Still, the government was to develop overall economic policy for the whole community, not merely the workers.
Common Tenets of Socialism
1) They all rejected the classicist notion of the harmony of interests. 2) All opposed the idea of laissez-faire. 3) Rejected Say's Law of markets. 4) Denied the idea of humanity, upon which classical thought was built, instead believing in the perfectibility of people. 5) Each of the various socialist ideologies advocated collective action and public ownership of enterprise to improve conditions of the masses.
Whom Did Socialism Benefit or Seek to Benefit?
Moderate groups (Utopian, Christian, and Guild socialists) claimed to represent everyone's interest, with primary emphasis on the needs and interests of the workers.  Extreme socialist groups (Marxist, anarchist, and syndicalists) proclaimed class warfare against the rich. Their sole aim was to promote the interests of the working class.
How Was Socialism Valid, Useful, or Correct in its Time?
Workers had legitimate grievances against laissez-faire capitalism as it developed in its early decades.  Utopian socialism expressed the disturbed conscience of humanity.  Marxian socialism offered an involved theoretical dissection of society that exposed and exaggerated its alleged evils.  The status quo had not squarely faced the two problems of poverty and recurring business depressions, and the socialists did a service by concentrating their focus on these problems.  Socialism aided in promoting factory acts, sanitary reform, cooperative associations, workers compensation laws, unions, pensions, etc.
Which Tenets of Socialism Become Lasting Contributions?
1) Developed the foundation of contemporary socialist economic thought, which emphasized state ownership of the means of production with national planning and coordination. 2) Several policy recommendations that they advocated have now been implemented in capitalistic countries. Examples include: social security, workers compensation, unemployment compensation, minimum wage and overtime pay laws, etc. 3) Their emphasis and analysis of the growth of monopoly power, the problem of income distribution, and the reality of business cycles.
Utopian Socialist 1760-1825 French
Socialist 1772-1837 French
Socialist 1773-1842 Swiss Launched direct attack on classical economies
Robert Owen
Utopian Socialist 1771-1858 British
State Socialist 1811-1882 French
Christian Socialist 1819-1875 "christianize the socalists, socialize the christians"
Karl Marx
Marxian Socialism 1818-1883
German Historical School
Major Tenets of German Historical School
1. Evolutionary approach to economics 2. Emphasis on the positive role of government 3. Inductive/historical approach 4. Advocacy of conservative reform
Who Benefited? (german school)
1) Members of the school - they aligned themselves with government that at the time controlled most universities. Those that were marginalists were excluded from academic positions in Germany. 2) The government - school advocated and defended a nationalistic state. 3) Business, financial and landowner groups - the social reforms advocated by the school thwarted a general uprising of labor advocated by the radical socialists.
Was the School Valid? (socialism)
It was correct in its perspective that economists needed to familiarize themselves with changing history and changing environments, with economic and social evolution, to understand the present world. Inductive studies are required for this.  New theories and ideas had to be evoked to understand new situations and these new theories and ideas required careful testing by empirical data.
German School 1789-1846
German School 1817-1894
German School 1838-1917
Max Weber
German School 1864-1920

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