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39 Cards in this Set
- Front
- Back
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How did average real wages change beginning around 1970? (Capitalism)
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Wages didn't increase with production. |
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What, according to the video, is the main cause of the economic crisis of the past few years? (Capitalism) |
main thing is wages were staggered. |
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Why does Lindblom claim the market can be considered a prison? |
Corporate limits the options of policy makers. Businesses are different than people in that way. In order to get us to do things the gvt punishes. Ex. speed limits |
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What evidence and/or examples does Lindblom provide in support of his claim that the market is a prison? |
factory polluted. |
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What does he say is the "defining difference between a government official and a business entrepreneur"? (Lindblom) |
The difference is that one is directed and controlled through a system of commands and the other is directed and controlled by a system of inducements. |
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What is the significance for a unit on Government and the Economy of the farmer's dilemma about whom to shoot? |
can't blame an individual, its the economic structure. |
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What are the components of the definition of capitalism? |
based on private ownership of the means of production, wage labor, production for market. |
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What factors account for what the book calls the "dynamism of capitalism"? |
encouraging innovation, promoting efficiency, and increasing productivity. |
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What evidence does the book provide that "capitalist market systems are volatile? |
supply and demand are not coordinated. Investment, production, and consumption fail to maintain balance. |
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What does the book mean by "affluenza"? |
an unsustainable addiction to economic growth that threatens to strain and overwhelm the government. |
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What is an externality? Give an example of one |
when you pay the cost for something you don't benefit from. For example air pollution causing illness in which you pay doctor bills for. |
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What evidence does the book provide in support of its statements that: --"capitalism also comes into conflict with the public interest"? --that capitalism "justifies an inherently undemocratic form of production?" |
when profits incentives that divert business from meeting public needs - pharmaceutical companies. Employers have the right to hire and fire, set wages, and tell workers what to do because they own and control the means of production. |
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On p. 38 the book says that "the interests of citizens are opposed to business as much as they are aligned with it." What does the book mean by that statement? |
Interests are similar because they provide jobbs and ____ but they conflict because you want to be paid more. |
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On p. 38 in the first sentence of the last paragraph, the book talks about a paradox. What is this paradox and how, according to the book, do people in the US resolve this paradox? |
supporting capitalist values, such as individualism and minimum state interference. |
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In the last sentence of the first paragraph on p. 39 the book uses the term giveaways. To what does that term refer and why, according to the book, do they make sense for local communities but harmful to the US as a whole? |
giveaways or tac breaks make sense to loval communities but not the U.S. as a whole because it takes away money from the government. |
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What does the book mean by "the structural advantage of business"? |
business is the goose that lays the golden egg. Society depends on what only capitalists can deliver, and capitalists will deliver only if they can profit. |
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Why despite its structural advantage does business not always win? |
business must engage in policy that involve "a shifting set of adversaries, and volatile public preferences." Companies of ten compete with each other and have conflicting interests in policy. |
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What is an example of a policy about which there is likely to be a relatively little agreement among businesses? What is an example of a policy about which most businesses are likely to agree? |
tariffs little agreement. |
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What does the book say that it's wrong to say that the U.S. is a shareholder democracy? |
about half of all Americans don't own stock. |
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What factors give U.S. corporate capitalism what the book calls its "distinctive flavor"? |
small public sector, less regulation, unions are much weaker, much greater inequality. |
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Is income inequality in the U.S. greater that, about the same, or less than that in the industrialized countries of Western Europe? |
greater. |
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What evidence does the book provide in support of its claim that "the free market has always been a fiction"? |
markets cannot exist without a gvt to maintain order, enforce contracts, create currency, and provide a host of other public goods. |
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On page 68 near the top, the book talks of periodic swings (of a pendulum) in U.S. history? What do those swings involve? |
How much government participation in the Economy. |
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What, according to Keynes, was the major cause of the Great Depression? |
inadequate consumer demand. The economy was caught in a vicious circle in which mass unemployment reduced the demand for goods. |
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During what years did the Golden Age of Capitalism occur? Why is it called the Golden Age of Capitalism? What were the causes of the Golden Age of Capitalism? |
1950-1970 pent-up consumer demand fueled the post war economy. The combination of disposable income and pent-up demand led Americans to spend more freely. |
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What is stagflation? When did it occur? |
stagflation- an unprecedented situation in which rising unemployment and inflation occurred simultaneously. -1970's |
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What does the book mean by "market fundamentalism"? What are some of its characteristics? |
Government shouldn't be in business, stay out of markets. |
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What is supply-side economics? |
supply-side economics argue that the economy suffered from unsufficient investment capital, not in sufficient demand. |
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Why, according to our book were tax-cuts seen as having political as well as economic advantages to most Republicans? |
They saw tax cuts as a way to reward voters and bind them to a party. |
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Summarize the main trends in income distribution in the U.S. between 1950 and 2006. |
growing inequality. |
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According to the book, what caused the financial crisis that began in 2007-08? |
housing prices collapsed and the stock market tumbled because of money lending. |
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How, according to the textbook, did the financial crisis and Great Recession discredit market fundamentalism? |
markets are vulnerable to unwarranted outbreaks of confidence that lead to speculative bubbles and to crisis of confidence in which credit dries up. |
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What are the characteristics of the "deadlock of democracy" to which the book refers? How does this deadlock differ from the political situation during the Golden Age of Capitalism and from what the book calls the era of market fundamentalism? |
During Golden Age, gut should be involved in the economy. |
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In the U.S., government expenditures are approximately what % of GDP? How does the % compare with that in most of the world's other industrialized countries? |
30% it's less. Smaller welfare state so our government spends less money. |
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What is the difference between the federal deficit and the national debt? |
debt- how much gvt owes. federal deficit- difference between taxes and expenses per year. |
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What is fiscal policy? Who makes it? |
Fiscal policy manipulates the total amount of government revenue and spending to manage overall demand in the economy. |
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What are the main trends in the past 50 years in the composition of government tax revenues ? |
The contribution that corporate income taxes make to total federal revenues has declined even more precipitously. |
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What are the main characteristics of the social security tax? What is the significance of these characteristics? |
No floor on social security tax but there is a ceiling. |
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What, according to the book, is a progressive tax system? a regressive tax system? |
progressive tax- the higher your income, the higher your tax rate. regressive tax- FLAT + meaning that tax rates should |
