economic history

Question 1

SA pre-industrial times

Answer 1

no modern structures
various ethnic groups
small communities
Shared responsibilities in community
egalitartian social structure
spirituality
customs, traditions, storytelling, rituals
writing not developed

Question 2

great bantu migration

Answer 2

(beginning in West Africa) beginning to reach southern A:
- Competition for grazing land & water could lead to skirmishes between groups, encouraging further migration
- Bantu migrants introduced new agricultural practices, ironworking technology & social structures.

Question 3

europe pre industrial

Answer 3

traditional economic system
rigid
economic growth did not exist
rural,agricultural
extreme poverty
poor transport, dirt roads
limited social mobility
low living standards
no cushion against economic shocks (famine,war,disease)
Low life expectancy driven by high infant mortality
Poor undetrstanding of hygiene & medicine
Superstition
Barter as means of exchange

Question 4

industrial revolution

Answer 4

2nd half of 18th century
series of technical advances
steam power
people moving to work in facories&cities

Question 5

social structure pre-revolution

Answer 5

hierarchical
land owners & peasants

Great divide between aristocracy & peasantry
Aristocrats (minority) lived in castles/large manors
Peasants forced to work hard, small single room houses w/ barn w animals attached
Poorly ventilated
Lord of manor- significant power- distribute land to followers in exchange for share of crops/ their labour on his land.
Peasants either free or villein (tenant entirely subject to a lord to whom he paid dues and services in return for land) or mix
Lord of manor would in turn owe service to his social superior, “knight’s fee” or provision of men/arms for superior’s wars

Question 6

social structure after revolution

Answer 6

large income inequalities-conflicts
working class and bourgeoisie/capitalists
Distinct working class and growing middle class (bourgeoisie) of factory owners, merchants and professionals emerged
Decline of land owners, wealth became more concentrated among industrialists

Economic divide between wealthy industrialists and working class
Industrialists reaped profits from enterprises, able to expand and accumulate wealth
Workers (essential to growth of enterprise) trapped in low wage positions
Widening gap between rich and poor - social unrest
Strikes and protests as workers sought to challenge status quo

Question 7

social mobility

Answer 7

the mobility to move up in life (education etc)
If you were born a peasant, you would expect to die a peasant.
Apprenticeship to a trade was a way to change one status (tho a risky one)

Question 8

working conditions in revolution

Answer 8

harsh
long hours
low wages
child labour
dangerous,unhealthy working conditions (ventilation, toxic fumes,machinery)
no protective worker ;egislation
machines replaced skilled artisans w/ low paid machine operators (Luddite riots)

Question 9

conditions in cities in revolution

Answer 9

air pollution
contaminated water
cholera , typhoid

Question 10

thomas malthus

Answer 10

cities struggled to adapt to rapid influx of new inhabitants
If wages rose, workers would have more children that survived the first few years of life and population would increase
Population rising faster than food production, eventually famine would arise.
Keeping wages low would curb the natural growth of population

Question 11

revolution improvements

Answer 11

Labour laws
trade unions allowed pressured owners for higher wages/better working condition

resulted in increase in ave. living standards but great inequality

Question 12

hockey stick growth

Answer 12

rapid growth in standard of living

Question 13

GDP

Answer 13

gross domestic product per capita
Higher- better standard of living
Lower- lower standard of living

- used to indicate average levels of production. 
- Value of all final goods and services produced in a country in a year.
- Nominal GDP can increase if increase in quantity of goods & services OR increase in prices they are sold at 
- Real GDP → remove impact of price changes when looking at quantity increases, measure of growth that is already corrected for changes in prices of goods and services and in the size of the population
- Increase in real GDP implies ave. person is experiencing a decrease in their standard of living

→ good approximation of ave. level of income and ave. level of consumption.

GDP doesn’t show how income is distributed

Question 14

IR reach in Africa

Answer 14

IR did not reach Africa in same way
Colonial exploitation, lack of infrastructure, limited access to technology prevented African societies from becoming industrialised
Colonial powers did not foster local industrial growth

Question 15

between country income inequality

Answer 15

After IR, some countries’ GDP per capita grew while others’ incomes stagnated resulting in large differences in mean incomes between countries

High : advances economies, high levels of industrialisation and infrastructure, access to quality education & healthcare, high standard of living
(UK,Germany,Canada)
Middle (upper (SA) & lower): developing/ emerging
countries/economies. Prev. low income countries but were able to increase ave level of income and develop to move from poverty (China,Inida,Kenya,Ghana)

lower: Significant challenges, limited access to clean water, healthcare, education, often comes with political instability, corruption, inadequate infrastructure

Question 16

within country income inequality

Answer 16

Highest in middle-income countries,lowest in high-income countries
reduces social cohesion, erodes trust, leads to crime & other illegal activities

Question 17

Gini coefficient

Answer 17

Measure of within country income inequality
0 = perfect equality
1 or 100= perfect inequality
SA: 0.63- Bad

Question 18

income distribution in US vs Europe

Answer 18

• US has fewer regulations and lower min. wage. European countries have stronger labour protection & social safety nets.
  
  • Tax systems in Europe more progressive than US, tax rate on wealthy in Europe much higher than tax rate on wealthy in US. Europe has more developed/generous social welfare program than US
  • Differing cultural attitudes towards wealth and income inequality. Great wealth applauded in US. Europe, visible wealth embarrassing
  • Higher levels of unionisation and collective bargaining in Europe, better wages and working condition

Question 19

income distribution russia

Answer 19

Fall of communism and transition to market economy resulted in oligarchs acquiring great wealth. Wealth remained concentrated among them due to lack of social safety nets & effective redistribution policies. Exacerbated by regional disparities in economic development (eg urban Moscow vs rural). Lower investment in services like education & healthcare

Question 20

Gini / income per capita U curve

Answer 20

Simon Kuznets
If a country is desperately poor- everybody is desperately poor- income is low, inequality low too

as countries develop and become richer and average income increases, the degree of inequality increases as well up to a certain point then eventually decreases (- usually driven by political socialist parties- lets tax the rich and give the money to the poor (grants) and increase opportunities for everyone) . Average income increases while inequality decreases.
In early stages of economic growth, wealth tends to concentrate in a small segment of population, increasing inequality. However as development continues & economy matures, social and political pressures result in policies that promote wealth redistribution & improve standards of living for worst off in society.

Question 21

income inequality in SA

Answer 21

worst in world
Gini coeff 0.63
legacy of apartheid: unequal distribution of wealth,unequal opportunities,forced migration

Question 22

Adam Smith

Answer 22

The Wealth of Nations: wrote about IR just as it was taking off
Argued wealth of country should be the quantity of goods and services it produces for its nation not gold (attack on mercantilism)
guilds artificially inflates skills, to detriment of society
against monopolies
importance of specialisation & division of labour- economic growth
argued for ethical approach to distribution of income
advocate of laissez faire capitalism: the invisible hand

Question 23

Invisible hand

Answer 23

• People driven by their self interest trying to improve their welfare improves the welfare of others
  If buyers and sellers could act feely in their own interests w/o intervention of gov & monopolies, public’s welfare would benefit (guided by an invisible hand)

Question 24

laissez faire economics

Answer 24

necessity of some gov roles (defence, justice, public works) but no heavy regulation & state control over trade. Gov interference stifle innovation and competition, leading to inefficiencies & reduced wealth.

Question 25

Karl Marx

Answer 25

Das Kapital Communist Manifesto identifies class struggles between landowners ('parasites') - influence slowly decreasing at this stage bourgeoisie ( capitalists - 'evil') - build factories, make profits, business owners, wealthy, producers proletariat (workers) - where his sympathies lay industrialisation creates wealth but results in great inequalities will be a proletarian rev.