Economic Doctrines

Front 1

What distinguished the Real and Money price of a commodity?

Back 1

Real price is its command over labor.

Money Price is the amount that will purchase goods.

Front 2

What were the Corn Laws?

Back 2

Tariffs on imported grain. They effectively placed a minimum price on imported grain to England.

Front 3

What were the Poor Laws?

Back 3

Poverty and misery were a natural punishment for the failures of the lower class.

Front 4

Give (3) Important Influences that shaped the life and views of Adam Smith.

Back 4

1. The general intellectual climate

2. The Physiocrats

3. David Hume

Front 5

Name (4) Major Points in Adam Smith's "The Theory of Moral Sentiments"

Back 5

1. The moral forces which dismissed selfishness and binded people together to work in a better society.

2. Sympathy interests us in the fortune of others and makes their happiness necessary to us.

3. Grief and joy in others arouses similar emotions in ourselves.

4. Candidates for fortune too often abandon the paths of virtue

Front 6

In Wealth of Nations, what (3) ways does division of labor increase output?

Back 6

1. Workers develop increased dexterity in performing one task repeatedly.

2. Workers don't have to worry about moving from one job to the next.

3. Machinery can be invented to make tasks easier because the jobs have become more simplified.

Front 7

Malthus identified (2) types of checks to population growth. What are they? Examples of each.

Back 7

1. Preventative Checks: postpone marriage, birth control

2. Positive Checks: famine, misery, & plague

Front 8

What are the policy implications associated with Malthus' "unproductive consumption?"

Back 8

1. The corn laws need to be retained.

2. Tariffs on imported goods enrich the landlords & ultimately unproductive consumption.

3. In times of economic distress, government spending is encouraged.

4. Don't allow redistribution of wealth through high taxes.

Front 9

List (3) concepts associated with Ricardo's idea of "rent at the intensive margin of cultivation."

Back 9

1. Because of law of diminishing returns, rent rises with the cultivation of land.

2. Each additional unit of labor and capital will add less value than the previous unit.

3. High rents are explained by high grain prices.

Front 10

List (3) points describing Ricardo's ideas on exchange value and prices.

Back 10

1. For a commodity to have exchange value, it must have use value.

2. The exchange value is determined by the labor time necessary to produce it.

3. Wages do not affect exchange value--only profits.

Front 11

List (3) lasting contributions of Ricardo to economic analysis.

Back 11

1. Theory of Comparative Advantage

2. Employment of Marginal Analysis

3. Law of Diminishing Returns in Agriculture

Front 12

Describe John Stuart Mill's perspective on the wage fund.

Back 12

1. Wage depends mainly upon labor demand and supply.

2. Wage cannot be affected by anything but the relative amounts of capital and population.

3. Government cannot increase total wage payments by fixing a minimum wage above the equilibrium level.

Front 13

List at least (2) points made by John Stuart Mill regarding exchange.

Back 13

1. Value of a commodity is based on its power to purchase another commodity

2. Value of a commodity cannot rise higher than its estimated use value to the buyer

Front 14

List (3) contributions that John Stuart Mill made in the area of international economics.

Back 14

1. Public education

2. Regulation in child labor

3. Gov't should mediate conflicts between private parties

Front 15

List (5) of Malthus' contributions.

Back 15

1. Ideas wellreceived by wealthy landlords

2. Opposed the poorlaws

3. Over stated thesignificance of rents and spending by the landlords

4. Distinctionbetween productive and unproductive consumption was inaccurate

5. Theory of glutsshowed an awareness of the potential problem from a fall in aggregate demand

Front 16

For Adam Smith, what were 2/3 major government functions?

Back 16

1. To protect society from foreign attack

2. To establish the admin of justice

Front 17

Describe how "rent" was treated by Ricardo in his analysis of income distribution.

Back 17

1. Basic conflict exists between landlords and the rest of society

2. Higher rents will reduce the profit share of the national income