1. Population-Consumption-Technology Week One General Info Rebecca

2. Thomas Robert Malthus 1766-1834 Author of An Essay on the Principle of Population Predicted population would always grow faster than food, dooming mankind to unending poverty & hardship

3. Thomas Carlyle 1795-1881 Historian and essayist (quoted several thousand times in the OED) 1849…and the Social Science—not a ‘gay science,’ but a rueful—which finds the secret of the universe in “supply-and-demand,” and reduces the duty of human governance to that of letting men alone, is also wonderful…..no, a dreary, desolate, and indeed quite abject and distressing; what we might call, by way of eminence, the dismal science.”

4. Population According to UN Population Division, 2002 Report, the world has 6.3 billion people. –China (106) –India (106)

5. Future trends? Depend on what? Since 1997, panel on “below-replacement fertility” From 2000 to 2002 report, lowered projection for 2050 from 9.3 to 8.9 billion (medium variant)

6. Impacts Mitigated by technology? –“everything that can be invented has been invented.” U.S. patent office director, 1899

7. Growth in any country Driven in long run by the implementation of ideas that are discovered throughout the world

8. Economic Growth Notorious black box Hard to account for with just one theory Sources of competitive strength never constant for long (Rosenberg, “How the West Grew Rich”) Ability to adapt a crucial talent. US has been successful because it has managed transitions from one source of advantage to another

9. The map of the world Times are indeed changing and theories produced then should be viewed with caution “Trust” by Francis Fukuyama notes some countries have a social relationship structure that can sort out markets better than others ( transparencies of operations)

10. From the perspective of a society Choices about linking inputs to outputs through production (allocation & distribution of mix of goods) Three fundamental questions: What will be produced How will it be produced For whom

11. What is possible? Doesn’t mean it will be done but could be done Can represent graphically or numerically Each possibility gains something but we also face opportunity cost Can illustrate with Production Possibilities Frontier (outermost curve, PPF)

12. Shape of PPF tells us something Linear or “bowed” Constant or increasing rate of opportunity cost Which is more “realistic”

13. David Ricardo Theory of Comparative Advantage –Not absolute advantage –Explanation for trade Among nations Exchange in markets between individuals

14. Types of Economies related but not the same as political structure Differentiated by the way society answers those fundamental questions Command—centralized authority is decision- maker “laissez faire” or market economy has individual economic agents making choices mixed

15. Focusing first on a market economy Individual economic units as decision- makers People in households Firms in business sector Interact in markets Inputs through production functions to outputs (goods/services)

16. What is a Market? A market is the collection of buyers and sellers that, through their actual or potential interactions, determine the price of a product or set of products.

17. Two types of goods Consumer Goods—who uses? Capital Goods—also an input! Time Matters

18. Market Outcome Supply and demand interact through the price signal to reach equilibrium (market price and associated quantity where neither a surplus nor shortage exists).