Economics: An Introduction to Traditional and Progressive Views

An Introduction to Traditional and Progressive Views

Howard J Sherman, E. K. Hunt, Reynold F. Nesiba, Phillip O'Hara, Barbara A. Wiens-Tuers

• Publisher: Routledge
• Year: 2015
• ISBN:
  9781317472360
• Edition: 7
• Topic: Business
• Subtopic: Business generale
• Index: Business

This classic text offers a broader intellectual foundation than traditional principles textbooks. It introduces students to both traditional economic views and their progressive critique. Revised, expanded, and updated for this new edition, the text puts the study of microeconomics, macroeconomics, and globalization in their historical context. While covering the same topics as a traditional text, it also offers a richer discussion of economic history and the history of economic thought, including the ideas of Karl Marx, Thorstein Veblen, and John Maynard Keynes. This allows students to see economics as a way of understanding the world - as a lens for social analysis - rather than, as immutable truth or ideal to which the world should be molded.This completely revised edition incorporates new chapters on microeconomics and macroeconomics, as well as more graphs to enhance the theoretical presentations. Unlike the previous editions, it includes many pedagogical tools to encourage student participation and learning. Each of the 56 chapters opens with Learning Objectives, and key terms appear in boldface within the text and are listed at the end of each chapter. Other end-of-chapter material includes Summary of Major Points, Analytical Questions, and References. An online Instructor's Manual is available to professors who adopt the text.

PART I

ECONOMICS OF HISTORY AND HISTORY OF ECONOMICS

PART I, SECTION 1

THE LONG ROAD TO CAPTITALISM

Chapter

1 Prehistoric Communal Institutions in the Middle East

2 Communal Equality to Slavery in the Middle East

3 Slavery to Feudalism in Western Europe

4 Feudalism and Paternalism in England

5 Feudalism to Capitalism in England

6 Mercantilism in England

7 Pre-Capitalism to Industrial Capitalism in the United States, 1776–1865

Appendix 7.1: Slavery in the United States

CHAPTER 1

Prehistoric Communal Institutions in the Middle East

This chapter begins the story of the evolution of the earliest humans and their societies. It describes the key characteristics and advances of prehistoric communities. This chapter also introduces and explains how the four categories of technology, economic institutions, social institutions, and ideology provide a useful framework for examining human societies. The interaction of the four categories in prehistoric communal societies explains why those societies survived and also explains why these societies did not change for an incredibly long time.

LEARNING OBJECTIVES

After reading this chapter you should be able to:

• Comprehend* the genesis of human beings and early societies.

• List and explain the four basic institutions of human society.

• Describe the six ways in which the four basic institutions of society interacted in prehistoric society.

THE VERY BEGINNING

Our sun and planets evolved over an enormous amount of time. The earth was originally uninhabitable by life as we know it. Over billions of years the earth eventually developed an environment in which we can survive. The geological changes in the earth are revealed in its layers of rocks. For example, some rocks show plant fossils from a million years ago or reveal violent volcanic eruptions.

When the environment permitted, life evolved in spots where all the necessary elements happened to be together. Life evolved from the simplest virus-like creatures that lived at least three billion years ago. Charles Darwin showed how nature selects from the existing individuals the ones best suited for survival under particular conditions. Eventually this type of individual has the highest reproduction rate, and over a long period of time that fact leads to changes in the species. This process of change is called natural selection. Thus new species evolved, including human beings.

At the time our first hominid ancestors (of the genus homo) evolved on grassy plains, they made simple tools and weapons from pieces of wood or stone or bone. Remnants of early humans are dated to six or seven million years ago, but the exact time is still controversial. Those with better brains could use tools and weapons more effectively, thus improving their chance of survival. This process led to slow enlargement of the brain. Hominids with a larger brain could improve the use of tools. An erect stance allowed early human beings to hold tools while running farther, increasing their survival chances. A new species of Homo sapiens (our present species) became dominant over 100,000 years ago. Eventually, the older species disappeared. There is much debate among scientists whether Homo sapiens wiped out the older types of hominids, interbred with them, or if they just died out.

The earliest societies developed by Homo sapiens endured through most of the last hundred thousand years. How do we know anything about societies that existed tens of thousands of years ago? Many societies of the past three to four thousand years had the ability to write down their languages, so scholars can translate their documents and learn a great deal about them. But earlier societies were prehistoric (meaning before written history) and had no written language. Two kinds of evidence are available on the earliest human societies. First of all, archaeologists dug up the earliest dwellings and graves containing weapons, tools, and ornaments, as well as skeletons. From this evidence, archaeologists deduce an amazing amount of information about how early humans lived.

Second, in the past two centuries anthropologists studied existing societies that resemble the prehistoric societies, though the numbers of such societies have steadily declined. One problem in using this kind of evidence is that we cannot say for sure whether existing societies that resemble the prehistoric ones behave exactly the way prehistoric ones did. Moreover, the evidence is contaminated because these societies were in contact with more advanced societies. If no one else, the anthropologist herself has contacted the communal society and therefore changed it. Nevertheless, in the past two centuries anthropologists accumulated an immense amount of reliable information on the earliest type of society.

THE FEATURES OF PREHISTORIC COMMUNAL SOCIETY

To understand prehistoric societies and how they changed, it is useful to examine the four key institutions of a society. Institutions are sets of customs, laws and norms that influence, enable or constrain human behavior. The four main categories of institutional structures of any society are technology, economic institutions, social institutions, and ideology.

What is meant by technology? We think of technology today as modern gadgets and machines, but it means far more than that. Technology is the way that human beings produce goods and services. Technology is based on the knowledge of how to do things, the available skills of the labor force or workers, the amount of production by each type of present equipment, and the quality of land and natural resources available. The technology of the early communal societies was based on knowledge about simple stone, bone, or wood tool making and was used for hunting, fishing, and the gathering fruits and vegetables. Since prehistoric societies lived off of hunting and gathering food, small groups had to roam over a large amount of land to find their food supply. The total labor force of each group was small, estimated at five to thirty-five people.

Table 1.1
Four Features of Early Communal Society

Technology	Earliest stone tools; hunting and gathering
Economic Institutions	Common ownership by extended family
Social Institutions	Group consensus
Ideology	Community togetherness and equality

An economy is the process through which a society provisions itself with the goods and services that it needs to survive and grow. Economic institutions are sets of relations between people doing economic activities and the ways that people interact in the economy. An economic institution is not a “thing” or a “place.” The main prehistoric economic institution was an extended family of brothers and sisters, cousins, aunts, uncles, parents and grandparents. There was a division of labor between men and women and a division of labor between young and old. Men, usually as a group, did most of the fishing and hunting. Women, usually as a group, gathered fruits, nuts, and vegetables. The division of labor between genders, however, was far from absolute because the men probably often gathered fruits and vegetables, while women probably hunted small animals. These two collective groups delivered their food to the whole band and the whole band consumed the food. This little collective group was isolated and seldom interacted with other groups.

Such family-based collective or communal societies have been present for 90 to 95 percent of human existence. No one word describes all aspects of family-based societies, but the term “communal” emphasizes the collective nature of their economic institutions. Since everyone worked together and everyone consumed the product, the prehistoric communes had no use for the market. Thus, the communes were non-market societies. (Remember, of course, that such early, family-based communes had little or nothing in common with the utopian groups called communes in the nineteenth and twentieth centuries.)

Social institutions are defined as all the non-economic ways that people interact, such as the political process, the family, or religious organizations. The earliest institutions were very simple. There was no separate government and most decisions were made collectively. There were no separate, organized religious institutions. Instead, the whole community took part in various ceremonies. There was no separate education system. Education consisted of learning from your parents and the rest of the band by following their example. There were no separate media. News was spread by everyone around the campfire.

Ideology is defined to mean a more or less coherent system of ideas about how society works and how we should behave within a given society. We may believe that an ideology is good, like democracy, or bad, like the idea of burning witches. Everybody has an ideology or ideas about how things work. Ideology is simply a particular viewpoint that integrates many of one’s ideas. The early communal social ideas (or ideology) reflected their life and environment. If the earliest groups behaved like similar small bands of people discovered in the nineteenth and twentieth centuries, then they valued cooperation among all individuals in the band. They also had a set of superstitious beliefs which were centered on animals and natural forces such as lightning.

The four features of communal society are summarized in Table 1.1.

Studying the four key institutions of early communal society raises many intriguing questions. When one asks how the four institutions fit together in the social whole that was prehistoric communal society, the tale becomes even more exciting!

Figure 1.1 Four Basic Features of Society

HOW THE FOUR BASIC FEATURES OF SOCIETY INTERACTED

At first glance, there seem to be hundreds of unrelated aspects to a society. In order to understand how society functions, the seemingly unrelated aspects must be looked at within a framework. The four categories—technology, economic institutions, social institutions, and ideology—will be our framework for understanding society as a whole. The four categories are not independent of each other. Rather, it will be seen that each of the four is determined by the other three. For example, technology provided quite reliable birth control devices. This new technology changed our ideas about sex. Thus technology can affect ideology.

A simple schematic picture of these interactions is presented in Figure 1.1.

Figure 1.1 illustrates six interactions:

1. Economic institutions with technology.

2. Social institutions with economic institutions.

3. Social institutions with technology.

4. Social institutions with ideology.

5. Technology with ideology.

6. Economic institutions with ideology.

We will explore how the interactions play a vital role in understanding the early communal society. The description of economic activity and productivity, the amount of output produced by each input, in this chapter relies on the archaeological evidence from the Middle East approximately one hundred thousand to ten thousand years ago. In addition, we know from studying small simple societies that every group devoted some time to leisure activities and recreation. More leisure time is found in early societies that lived in easier environments, such as a fertile Pacific island with a pleasant climate year round.

ECONOMIC INSTITUTIONS AND TECHNOLOGY

The technology of the prehistoric communal society was based on land for hunting and gathering, a small labor force and production based mostly on simple stone, bone, and wooden tools. Communal economic institutions were described as nothing but an extended family acting collectively. How did the communal institutions interact with the simple tools they used?

Each band of people was forced to form a communal group to protect themselves from large carnivores as well as to hunt large animals such as the mammoth. An individual who left the communal group usually died quickly. With the simple technology using bone, stone, and wooden tools, the prehistoric communal society was able to hunt animals, gather plant resources, and make leather and fiber implements, clothing, and shelters. Because technology was at such a simple level, if everyone worked together all day there was only enough food, clothing, and shelter produced for everyday survival. In other words, productivity was relatively low. For this reason, no one could specialize in any one trade since that would have reduced the production of needed supplies below immediate, daily needs.

Through peer pressure, the economic institution of the family encouraged work at a reasonable pace, but it did not encourage people to do anything differently than the family had always done. Because there were no specialists, no one focused his or her thoughts on how to improve tool-making technology. In fact, the prehistoric communal people did not dream that their tools could be radically improved. When the family is just above the starvation level, it cannot take chances with new ways of doing things that might result in death by starvation for most of the family. For all of these reasons, technological progress was very, very slow. In tens of thousands of years, there was very little improvement.

One consequence of the low technological level was that if there was a...

Table of contents

• Cover
• Half Title
• Title Page
• Copyright Page
• Dedication
• Table of Contents
• Foreword
• Preface
• Acknowledgments
• Part I. Economics of History and History of Economics
• Part II. Microeconomics: Prices, Profits, and Poverty
• Part III. Macroeconomics: Growth and Stability
• Part IV. International and Global Policy
• Glossary
• References
• Index