Study Guides (390,000)
CA (150,000)
UTSG (10,000)
POL101Y1 (200)
Final

Political Economy 101 Good for exam and essay


Department
Political Science
Course Code
POL101Y1
Professor
Jeffrey Kopstein
Study Guide
Final

This preview shows half of the first page. to view the full 3 pages of the document.
January 31, 2011
POL101Y1
“How the rest got rich” Political Economy 101
“…capitalism and bureaucracy have found each other and belong intimately together.” Max
Weber, 1911.
- Getting rich has less to do with people, more with economic systems.
17th Century Dutch Hegemony
- Decline of Spanish dominance end of 16th century
o Rise of the dutch in 17th century
- Multicultural
o Amsterdam was home to many different cultures
- Industrial innovation
o Before the era of steel.
o Windmills.
Energy was used to begin mechanized industrialization
- Modern finance
o First stock exchange
o First central bank that was willing to invest in industry.
o It was the first nation that could raise capital from public sources.
- Trade
o True multinational trading economy.
Market Principle
- Increase supply -> decrease price.
- Increase consumption
- Increase trade and market share.
Principles of the Market Economy
- Assuming demand is constant, consumption is a function of price the lower the price
the better (Buffalo)
- An increase in supply decreases price -> increase in consumption (Walmart)
- A decrease in supply increases price -> decrease in consumption (energy, gas, etc…)
Adam Smith, The Wealth of Nations (1776)
- Invisible hand of the market is the most crucial.
- Absolute (and comparative) advantage
- Specialization
- Productive efficiency
- Universal division of labour exports and imports.
o If you are good at making wine but not good at making textiles, then make wine.
- Most of the state regulations for the promotion of public prosperity are unnecessary, and
a nation in order to be transformed from the lowest state of barbarism [the rest] into a
You're Reading a Preview

Unlock to view full version