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Mr. Tulk
Chapter 7
Social 10-1
• Welcome back, sorry I was away
• Did everyone have a good break?
• Essays and Tests.
– Essays are nearly done.
– Tests will not be given back until all are
finished and corrected.
– So, anybody that hasn’t completed the
test. You have to write it tomorrow.
• we’ve seen the development of
Cultural Contact.
• What is Cultural Contact?
• What examples have we discussed?
• Do you think you have a good
understanding of Social
Let’s get started…
Early Economic Globalization
“The Silk Road”
• The desire for foreign goods by people
led to International trade.
• Over time trade routes developed
around the world.
• One of the most famous and useful was
the silk road.
• The initial movement for goods led to
trade of ideas, technology, religion, art,
• Cities soon became centers for trade
and commerce.
• The Silk Road is an extensive
interconnected network of trade
routes across the Asian continent.
The Silk Trade
• The new road allowed for the trading
of silk and spices from east to west.
• The was known as the “Silk Road”.
• It moved products from one side of
the “known” world to the other.
• It also brought knowledge of other
societies and cultures around the
China hits the Water
• 700 years after the silk road was
developed, China develops a strong
international ocean trade.
• They traded with many other nations.
• The Europeans soon caught on to
this and began to explore, trade, and
expand the globe.
• Eventually they developed a system
call Mercantilism.
• A Eurocentric economic policy
whereby European monarchs
increased their wealth through
international trade.
• As European countries began
expansion and colonization they
began getting resources from other
parts of the world.
• Sugar from the Caribbean, Fish
from the Atlantic, Fur from
Canada, etc…
Eurocentric View
• As navel technology and mapping
became more efficient, Europeans
began seeing the world in a very
Eurocentric way.
• This often influences how we see the
• However, it has increasing become
more American centered.
Under this System
• Monarchs controlled the assets of
and trade.
• They could charge taxes for others
to gain access to these resources.
• Sometimes the government would
give a Monopoly on a resource.
Some Examples
• The Dutch East India Company
was a trading company, which
was established in 1602.
• when the Netherlands granted it a
21-year monopoly to carry out
colonial activities in Asia.
• It was the first multinational
corporation in the world.
• the oldest corporation in North
America and is one of the oldest in
the world.
• In the late 19th century, it became the
largest part of Canada.
• The company was the largest private
How Mercantile became Capitalist?
• Many large Merchants built strong
businesses and a lot of wealth.
• Some began lending money and charging
• They began to develop other companies
and services that were in demand by the
• Thus began capitalism and the idea of
supply and demand.
Capitalism Values
Economic Freedom
Personal Responsibility
An Economic system based
on free markets (no
government interference,
based on supply and
demand), private ownership of
business, and the profit
• Each individual in these new
republics should be able to work
as hard as they want and get what
they work for.
• Adam Smith, a Scottish
Philosopher, developed the idea of
a society based on Supply and
• What is
happening in
this cartoon?
• From this can
someone tell me
how supply and
demand works?
• Market - is a place where goods are bought and
– Producers decide:
– what to produce
– what goods will cost (based on what consumers want)
• law of supply and demand controls the market
(the invisible hand)
– supply - as the price of produce increased, producers will
want to make more, in order to make a larger profit
– demand - as prices increase, consumers will want to buy less,
or will want (or demand) more if price decreases
– supply and demand determines the $ of a good or service
– Equilibrium - is where supply and demand meet or intersect
Let’s look at this to explain it.
Another Example.
• It’s a hot hot hot day.
• Uncle Bill’s is giving slushies away
for free.
• I want to sell you a cup of melted,
warm, slushy.
• How much would you pay for it?
Let’s change it a little.
• It’s a hot hot hot hot day.
• Uncle Bill’s is closed.
• I have the only available water in Fort
McMurray and I’m behind bullet proof
glass(so, you can’t take it).
• How much would you pay for that
The History of Capitalism
• In 18th century Europe, the people
wanted a change.
• The government controlled all
aspects of life.
• This idea of freedom sparked a
desire for the government to move
away from business.
Free Market
• In a free market the government does
not control how people spend money.
• Open competition between
• If people want something, someone
will make it.
• The strongest a best companies will
Early Capitalist believed
• Desire for profits motivate people.
• People compete for self-interest.
• People have the right to accumulate
property and wealth.
• That production and business should
not be in the hands of government.
• Early capitalist argue that the creation
of wealth is good.
• But, it can have pros and cons?
• Let’s talk about the pros and cons of
Strengths/Weaknesses of the Market
Advantages / Strengths
– Economic Freedom:
• freedom to buy or sell what you wish
• anyone can start a business if they want
– Little government intervention:
• private enterprise controls the flow of the economy through supply and
demand; there is not overproduction of goods
– Individual Responsibility:
• consumers have the responsibility to make good economic decisions;
they are expected to shop wisely
• this is good because it creates competition among sellers
Strengths cont.
• Efficient Structure:
– the “invisible hand” helps to guide the economy
– people purchase goods based on needs and wants,
which helps to guide the flow of production
• Provides Incentives:
– the inequality of the distribution of wealth helps
to provide incentives for people to work hard
– there is a lot of opportunity for individual gain
Disadvantages / Weaknesses
• Media Influence:
– the media can negatively influence customers to purchase
goods (honesty??)
• ie. Commercials, advertising
• Lack of direction:
– there is little government control so there is no one
organization to ultimately oversee the economic activity
• Spiral Inflation:
– the cost of goods is constantly increasing, this decreases the
value of the dollar and more is spent on less