Traditional Society/ Economy

- Food production (i.e.) agriculture absorbed 75% or more of the working force
and a high proportion of income above minimum c+onsumption levels was
spent in non-productive or low productive outlays -> monuments -> religious
on
On others
o Wars; high living

Pre-conditions for take-off

- Evolution of the modern science and modern scientific attitude
- Innovation that came with the discovery of new lands. Impulse to create
new technologies
- Transportation
- Increased productivity in agriculture
- Expansion in trade
February 23, 2017 (PowerPoint #3)
Age of High Mass Consumption
There are three directions that an economy can go to when it reaches this age:

Public measures that improve security and welfare and maybe leisure for the
population. (government provided)
The economy is going to provide an enlarged pool of public or private
consumption
o More consumption in terms of housing (more readily available to
people): single family homes, less condominiums more real estate
houses
o Consumer durables (more of the leisure area: cars electronics)
Some counties seek to enlarge power on the world scene
o Example: China

Thomas Mann

Buddenbrooks
o 1st generation
Econ development

2nd generation

Position in society

3rd generation

Concerned with arts/ music

Lecture 5

Surplus value
Feudalism to capitalism
Developing countries in the context of Marx
o Social classes
o Alliances
Marx -> evolution
o Feudalism -> capitalism -> socialism -> communism
o Lenin urban proletariat as the movement to communism
o Mao Zedong acceleration through revolution
Peasant revolution
Mode of production
o Technology production related, whether production is labor intensive
or capital intensive
o Work relations social classes in the mode of production of the way the
relate to one another
Social classes identified with regards to the work setting ad class
interests
o Organizations
Formal visible institutions
Strong centralized government, corporation, business,
professional organizations, financial institutions
o Institutions
Non-visible aspects of society
Beliefs, attitudes, language
Laws, customs, rules, morals, ethics, value system
Feudalism
o Landed aristocracy vs bourgeoisie
o Landed aristocracy rent-based class
o Bourgeoisie merchant
Capitalism
o Bourgeoisie (business owners) vs laborers/proletariat
Surplus Value
o Refers to the capability of an economic system to produce basic
needs/services in excess for everyone in society
o Value added
o Important is where we put the surplus
Capital accumulation -> physical capital investments
o Refers to investment I actual factories/plants, machineries, equipment,
infrastructure
It increases societys capability to produce goods and services
Labor productivity
 o Human capital investment refers to schemes to increase labor
productivity
Education, skills training, -> helping workers improve their productivity

Productive Activity
o Activities that directly increase societys capacity to produce goods and
services
Better innovation, better capacity
Unproductive Activity
o Activities that do not increase societys capacity to produce goods and
services
o 4 traditional unproductive capacities (from Marx):
The military/police are unproductive
Professions involved in property rights/ or the ones that have to
do something with the transfer of assets/ownership.
Assets lawyers, real estate brokers, finance shit
Administrative classes
o Religious professions
o (added by adam smith) entertainment