Show Me the Money! Lesson 6: Economics

Economy A way of organizing the: Production Distribution Consumption Of goods and services Economies came about after the advent of agriculture Food foragers had no need for an economy

Industrialism The economy increases in complexity after Industry begins I A Food Goods

Before Industry Which country was the wealthy country in the world in the 1600s? Why was this country the wealthiest? How did the factory system change all of this? Luddites – those who resisted the changes of industrialization

Post-Industry A transition has taken place in industrialized countries since the 1950s PI I A Food Goods Services

Post-Industry Means: Increased automation Deskilled labor Less job stability A decline of labor unions Less people employed with benefits Increased worker isolation and alienation A global division of labor Peasants are very much a part of this global economy

Modes of Exchange There are three modes of exchange and we each use them every day Market Exchange Transfer of goods and/or services based on a price set by supply and demand Money or trade can be used Markets are very old Places you would go to sell or buy goods Now you don’t have to leave your home to go to a market – Amazon.com

Modes of Exchange, Pt. II Redistribution A system where a material tribute (such as food) or tax is paid to a central authority The central authority can be a person like a chief or big man, or can be a government The tribute is used to support the central authority The remaining surplus is redistributed to the group as goods and services This also acts as a leveling mechanism to decrease the gap between rich and poor

Modes of Exchange, Pt. III Reciprocity An exchange between two people Generalized reciprocity Takes place between people who are close (kin or friends) No value kept track of, no immediate repayment required Balanced reciprocity Involves more social distance Requires an equal value and a set limit for repayment Negative reciprocity Someone tries to get something for nothing Creates social distance between people

Christmas Christmas in the modern US doesn’t emerge until the height of the Industrial Revolution Previous was an end of year celebration in England In 1770s, December 6th started to be celebrated by some in NYC A Christmas Carole widely spreads the holiday in the 1840s Fat and jolly Santa appears in the 1860s Lots of giving occurs during Christmas

Capitalism and Socialism S C Karl Marx Adam Smith Collective Ownership Private Ownership Group Individual Central Control Free Market (laissez faire)

Exam Review Questions What is the definition and application of the following modes of exchange? Market exchange? Redistribution? Reciprocity? What are the three types of reciprocity? How are they different from each other? What does Lee Cronk tell us about the Kula Ring in “Reciprocity and the Power of Giving”? What is it? Where does it take place? Who participates? What does the economy organize? Are peasants a part of the global capitalist system? Why or why not? What is the difference between capitalism and socialism?