EC490 Exam 1

Briefly outline in chronological order the conflicts between the American colonists and Parliament and the Crown from the end of the 7 years war to the onset of the Revolution. CASSQDTMTI

1751 Currency Act (The act was extended in 1764) *Prohibited the issue of new bills of credit by New England Colonies. In 1763, this was extended to all British colonies in the Americas, increasing more tension between Britain and America. 1763 Proclamation of 1763 *After Britain won the Seven Years' War and gained land in North America, it issued the Royal Proclamation of 1763, which prohibited American colonists from settling west of Appalachia. 1764 American Duties (or "Sugar") Act *was the first tax on the American colonies imposed by the British Parliament.* 1765 Stamp Act *The new tax was imposed on all American colonists and required them to pay a tax on every piece of printed paper they used. Ship's papers, legal documents, licenses, newspapers, other publications, and even playing cards were taxed.* 1765 Quartering Act *British Parliament met and finally passed a Quartering Act for the Americans. The act stated that troops could only be quartered in barracks and if there wasn't enough space in barracks then they were to be quartered in public houses and inns.* 1766 Declaratory Act *declaration by the British Parliament that accompanied the repeal of the Stamp Act. It stated that the British Parliament's taxing authority was the same in America as in Great Britain. Parliament had directly taxed the colonies for revenue in the Sugar Act (1764) and the Stamp Act (1765).* 1767 Townshend Acts *The Townshend Acts were a series of laws passed by the British government on the American colonies in 1767. They placed new taxes and took away some freedoms from the colonists including the following: New taxes on imports of paper, paint, lead, glass, and tea. This helped to refuel the anger in the colonies against Parliament since the year before they repealed some of the taxes.* 1770 Boston Massacre *British soldiers in Boston opened fire on a group of American colonists killing five men. Prior to the Boston Massacre the British had instituted a number of new taxes on the American colonies including taxes on tea, glass, paper, paint, and lead. Several colonists were killed and this led to a campaign by speech-writers to rouse the ire of the citizenry. 1773 Tea Act *The Tea Act, passed by Parliament on May 10, 1773, granted the British East India Company Tea a monopoly on tea sales in the American colonies. This was what ultimately compelled a group of Sons of Liberty members on the night of December 16, 1773 to disguise themselves as Mohawk Indians, board three ships moored in Boston Harbor, and destroy over 92,000 pounds of tea.* 1774 Intolerable Acts (Port of Boston Act, Quebec Act, Massachusetts Government Act) *The Intolerable Acts were punitive laws passed by the British Parliament in 1774 after the Boston Tea Party. The laws were meant to punish the Massachusetts colonists for their defiance in the Tea Party protest in reaction to changes in taxation by the British to the detriment of colonial goods.*

Briefly critique the statement the the American Revolution was a tax revolt.

"No taxation without representation" — the rallying cry of the American Revolution — gives the impression that taxation was the principal irritant between Britain and its American colonies. But, in fact, taxes in the colonies were much lower than taxes in Britain. The central grievance of the colonists was their lack of a voice in the government that ruled them.

What was the "first economic revolution?" Briefly explain it and explain its importance for subsequent economic growth and development.

(Neolithic Revolution) The world's first economic revolution was the Agricultural Revolution. It is when we made the switch from being hunter-gatherers to being farmers. Moving us from pre-history to civilization. Prior to the first economic revolution, man lived in communal groups, taking from nature what could be killed or gathered. The limits of man's livelihood were fixed by a resource base upon which he could not yet improve. With the development of settled agricultural and the conscious production of food, man first acquired the basic ability to increase his resource base, which enabled him to support a larger population, to secure higher living standard. *Marked increases in man's control over nature, an ability which enabled him to support a larger population, to secure higher living standards, and to create in the process complex civilizations.

What was the "second economic Revolution?"

Also know as the Industrial Revolution, was the radical idea that one could work on a machine rather than a farm, and create faster production. Cities grew rapidly and brought new forms of organization societal structure. The Industrial Revolution had come through and completely displaced agricultural civilization.

Why did the first and second revolution succeed?

Both the first two economic revolutions started and succeeded for the same simple reason: they represented more powerful and efficient ways for helping human beings get the goods and services they needed to live and thrive more than the previous regime.

Describe the way the First and Second Banks of the United States COULD conduct the monetary control activities of a modern central bank.

Following the Revolutionary War, the newly formed nation of the United States sought a way to re-establish commerce, repay war debt, restore the value of currency, and lower inflation. One of our Founding Fathers — Alexander Hamilton, the first Secretary of the Treasury — devised a plan to accomplish these goals. His idea? Create a national bank that would issue paper money, provide a safe place for public funds, offer banking facilities for commercial transactions, and act as the government's fiscal agent. First BankMany people opposed the idea. They believed that a national bank was unconstitutional and would place too much power in the hands of the federal government. Despite the opposition, Hamilton prevailed, and Congress created the Bank of the United States (often called the First Bank), granting it a 20-year charter. Although not a central bank in the modern sense, the First Bank was the nation's first attempt at central banking. It opened in 1791 and closed in 1811, when Congress failed to renew its charter. However, by early 1815, much like at the end of the Revolutionary War, the U.S. found itself heavily in debt after fighting the War of 1812 and struggling with soaring prices and devalued money from rising inflation. Furthermore, with no national bank, the government had difficulty borrowing money and making payments. Many people felt that the solution to the country's problems lay in establishing another national bank. After much debate and opposition, Congress established the second Bank of the United States (the Second Bank), which, like its predecessor, had a 20-year charter. Opening in 1816, the Second Bank closed in 1836, when Congress failed to override President Andrew Jackson's veto of the reauthorization of the Second Bank.

What is the difference between monometallism and bimetallism? Specifically, explain each and explain under what conditions they later would be de facto be the same as the former.

Monometallism- the use of only one metal *gold* Bimetallism- currency of two metals

What was the "demographic transition?" Graph it.

Relationship between Economic Growth and Population Growth slide 12 of lectures 5 &6)

***What is the Total Factor Productivity? How does one go about estimating it? What does it tell us about long-run economic growth? What would be a good benchmark figure for TFP growth in a modern developed economy - 0.0 to 0.5% per annum, 1.0 to 1.5%, 13.76%?

TFP is the portion of output not explained by the amount of inputs used in production. Measured as the ratio of aggregate output(GDP) to aggregate inputs. Total Product/ Weighted Average of inputs

What was the antebellum puzzle? Was the "puzzle" ever solved. If so, how?

The Antebellum Puzzle' describes the situation of declining stature and pos mortality in the three decades prior to the American Civil War (1861-65). It is this period was one of rapid economic growth and development in the United State the debate has centered on whether the American diet, both in terms of protein a deteriorated in the middle of the 19th century. But the mortality environment a have worsened (or at least did not improve), connected with factors such as urba commercialization, and increased geographic mobility. *Shrinking of the US population and the onset of modern economic growth. Lectures 5 & 6 We can refer to the Antebellum Puzzle as the result of a "Malthusian Squeeze", rather than a full-blown crisis. The bottom line is that the cause was a deficiency in net nutrition. What ended the puzzle: The germ theory of disease helped As did mechanical refrigeration, which allowed an increase in protein consumption and nutrients more generally

Gold Standard

The gold standard is a monetary system where a country's currency or paper money has a value directly linked to gold. With the gold standard, countries agreed to convert paper money into a fixed amount of gold. A country that uses the gold standard sets a fixed price for gold and buys and sells gold at that price

Briefly Describe the Bank War.

War between the Jacksonian Democrats and the Bank of the United States (Prop Whig initity) 1832 - Jackson was hated man. VP Kalhoon hated him so much that he left the ticket and his party. Gives to pet bank- state charted bank ?? 1833 - "Friends of the program" 1834 - Biddle was an ellite member. Head of the bank of the united states. Jackson hated him bc he was so eduated and refined. Biddle said "okay, you want a war? I will give you a war." 1835- 36 - Bank of the United States is not as big and bad as it was before (worst since the revloution) 1837 - Banks crash and there is no credit (first recession on record since revlotuion) 1839- Double dip. Economy (Ch 7&8 slide 17)