"Since the 1700s, increases in average living standards became a permanent feature of economic life in many countries. This was associated with the emergence of a new economic system called capitalism, in which private property, markets and firms play a major role. Under this new way of organizing the economy, advances in technology and specialization in products and tasks raised the amount that could be produced in a day’s work. This process, which we call the capitalist revolution, has been accompanied by growing threats to our natural environment, and by unprecedented global economic inequalities." (Core Econ, Chapter 1)
Today we will explore the idea of economic growth and both absolute and relative living standards. We will discuss ideas such as nominal GDP, real GDP, growth rates, and purchasing power parity as ways of measuring economic well-being. We will also begin to explore the causes of economic growth in addition to the barriers to it.
There is no work due today, as this is our first class.
You should have read the following section in Chapter 1 ("The Capitalist Revolution") of Core Econ: 1.3 The Economy and the Environment.
Watch these videos:
Read the following section in Chapter 1 ("The Capitalist Revolution") of Core Econ: 1.3 The Economy and the Environment
Read the following sections in Chapter 1 ("The Capitalist Revolution") of Core Econ:
Podcast: In this podcast Bruce Yandle of Clemson University and George Mason University's Mercatus Center looks at the tragedy of the commons and the various ways that people have avoided the overuse of resources that are held in common. Examples discussed include fisheries, roads, rivers and the air. Yandle talks with EconTalk host Russ Roberts about the historical use of norms, cooperative ventures such as incorporating a river, the common law, and top-down command-and-control regulation to reduce air and water pollution.