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STUDY GUIDE ECONOMICS 310 APRIL 2000 This study guide is a compilation of many old and some new examination questions. The number of questions on a topic reflects the length of time a topic has been in the course syllabus, not its importance in the course as presented this year. There will be no positive correlation between the number of questions on a topic and the likelihood of the topic appearing on the final examination. Indeed there might be a negative correlation, although I would not advise you to count on that either. I have deleted questions which are not relevant to this year’s course. 1. Explain why the Spanish discovery of the New World had a lasting impact on the economies of the new and old world while the Viking discovery of the New World had no lasting impact. 2. The Old World governments which promoted settlement in the New World believed that the colony should serve the interests of the mother country. Discuss the benefits mother countries expected to receive from their colonies and indicate which colonies of all those in the New World best met the goals of the mother countries. 3. Discuss the place of Canada in trade within North America and between North America and Europe in the 17th and the 18th centuries. 4. Compare and contrast the impact of Europeans on native peoples in Central America and on native peoples in Canada, giving explanations for the differences. 5. Discuss the importance of military alliances between native peoples and Europeans to the evolution of the fur trade. 6. Compare and contrast trading relations between the French and the native peoples before 1650 with trading relations after 1650. 7. How would the evolution of Canada's economy differed if there had been no European demand for furs in the 17th and 18th centuries? How would the evolution of Canada's economy differed if the French government had not taken direct control of the colony during the second half of the 17th century? 8. The English colony of New England developed a thriving commerce with the West Indies and Europe. Quebec's commerce was not nearly as vigorous. Outline the major reasons for the differences in economic performance. 9. Use the staples model to explain the impact of fish, fur and sugar production on the pace and nature of economic development. Which staple was better for the economic development of a region? Justify your answer. 10. Using the staples thesis, describe the linkages of the fur trade and discuss the contribution of that industry to the economic and political development of Canada. 11. Timber has been an important Canadian export from the early nineteenth century to the present. Using the staples thesis, compare the impact the timber industry had on economic development in Southern Ontario with the impact it had on economic development in the Maritimes during the early nineteenth century. 12. Using the staples thesis compare and contrast the impact of fish, fur, timber and wheat on the development of Atlantic Canada, Ontario, Quebec and the Prairies. Discuss both the differences in development caused by different staples, and the differences in development which resulted even when two regions had the same staple. 13. To a large extent, Canada's development in the pre-confederation period depended on the production and export of staple products. Compare the potential for development of the staples fish, fur and timber and discuss the extent to which the potential of those staples was realized by the mid-nineteenth century. 14. Using the staples thesis, discuss the factors which determined the timing of the development of the timber industry in British North America. 15. The staples thesis argues that economic development is driven by the markets for staple export products while the livelihood model argues that the productive capacity of a region is more important in determining development. Discuss which approach best explains the development of Ontario up to 1850. 16. The staples thesis argues that the pace of development of a region is determined by the external demand for a staple and the richness of the staple's linkages. Briefly describe the staples which were important in the colonies of British North American before 1850 and discuss the impact of the success or failure of staples production on the rate of settlement and the pace of economic development in those colonies. 17. The fishery, the first industry to attract labour and capital to Canada, has had a long and often troubled history in Canada, but was the basis for much of the early economic activity in Atlantic Canada. Discuss the strengths as well as the weaknesses of the fishery as a source of economic development in the preconfederation period. Be sure to use the staples model in your answer. 18. Agriculture in general, and wheat in particular, have very good linkages which promote economic development of a region. Discuss the nature of agricultural development and the impact of agriculture on the economies of the Maritimes, and Central Canada in the pre-confederation period. 19. Describe the obligations of the censitaire in the seigniorial system. What impact did the system have on the economic development of New France? What impact did the system have on the economic well-being of the habitant? 20. Many contemporary commentators criticised the timber industry for distracting farmers from agricultural. Discuss the relationship between the timber industry and agriculture and determine whether the former had a negative or positive impact on the latter. 21. French Canadian agriculture has been characterised as so backward and inefficient that by the early 19th century it became unable to produce a surplus beyond the consumption needs of the farmers themselves. Discuss the extent to which there is 2 support for this position. 22. Equality of opportunity and efficiency in development of agriculture are two goals we might believe a land granting system should achieve. Compare and contrast the extent to which the Seigneurial system, the British land granting practices in the late eighteenth and early nineteenth centuries, and the Dominion Land Act applied to settlement in the Prairies achieved these goals. 23. Discuss the role of agriculture in the economy of New France and describe its place in trade in the New World. 24. The Acadians grew grain and a variety of other crops on the diked marshlands. By the early nineteenth century, the English settlers used those marshlands almost entirely as pasture. Briefly explain why the change in land use occurred 25. Commentators often assumed that the abundance of land resulted in little real poverty and relatively equal social status among settlers. Discuss the extent to which the evidence supports the assumption of equality of opportunity in the Maritimes and in Ontario in the early nineteenth century. 26. Discuss the major tenants of mercantilism and explain how the colonies of New France and Newfoundland met the policy goals of their governments. 27. From 1840-1867 many changes occurred in the transportation system and tariff structure of British North America. Discuss the economic impact of these changes on British North America and consider the extent to which they aided the development of the economy as a whole or they merely benefited a particular interest group. 28. Between the beginning of British control of the territories which became Canada to 1850 Britain moved from a policy of mercantilism to a policy of free trade, but the British North American Colonies were free to set their own tariffs. Discuss the changes in British tariff policies, and explain the differences in the tariff policies of the Canadas, New Brunswick and Nova Scotia. 29. Between the beginning of British control of the territories which became Canada to 1850 Britain moved from a policy of mercantilism to a policy of free trade. Explain the impact of British tariff policies on British North American timber and wheat exports. 30. The Reciprocity treaty was implemented in 1855 and ended in 1867. Discuss the provisions of this treaty, the strategies used to ensure American agreement to it. Explain the impact it had on Nova Scotia’s economy. 31. Compare and contrast the tariff policies implemented in Ontario and in New Brunswick before Confederation. Explain why the governments of the two provinces chose different tariff policies. Which do you think was better for development? 32. Galt claimed that the tariff changes introduced in Canada in the 1850s were intended to raise needed revenue and were only incidentally protective. Discuss the 3 structure of the tariff schedule imposed and determine if his statement is plausible. Compare the tariff policies of New Brunswick and Nova Scotia before Confederation and explain why those provinces adopted somewhat different policies. 33. Explain why major changes in tariff policy occurred in Canada during the 1840's and 1850's and discuss their impact on the Canadian economy. 34. The theme of the commercial empire of the St. Lawrence has been used to explain early economic policy in British North America. Describe the second empire of the St. Lawrence and discuss the sense in which this thesis is useful in understanding the transportation and tariff policies implemented in Canada before 1850. 35. Canada has experienced many changes in its own and its trading partners' tariff policies. Describe the changes in British, Canadian and American tariff policies during the nineteenth century and discuss the impact the changes had on the development of staples production and secondary manufacturing in Canada. 36. Over its history Canada has experienced a number of tariff regimes: inclusion within a free trade area established by British mercantilism, adoption of various tariff structures by each province, reciprocity in the mid-19th century and creation of the national policy tariffs in the late 19th century. Describe the differences in these regimes and explain their impact on Canadian economic development, considering whether protection or free trade was the better policy. 37. From 1840-1867 many changes occurred in the transportation system and tariff structure of British North America. Discuss the economic impact of these changes on British North America and consider the extent to which they aided the development of the economy as a whole or they merely benefited a particular interest group. 38. Standard economic theory argues that tariffs hurt an economy by forcing it to shift resources out of industries in which it has a comparative advantage and into industries in which it lacks a comparative advantage. Explain the extent to which this analysis is relevant to Canada during the nineteenth century and discuss the impact of the National Policy tariff on the size of the Canadian economy, the prevalence of monopoly, the level of industrialization and the degree of national independence of the Canadian economy. 39. MacDonald introduced highly protective tariffs in 1878. Discuss the impact of these tariffs on total gross domestic product, per capita income, and the degree of competition in the Canadian economy. 40. In 1878 Canadians expressed their preference for a highly protective tariff by electing J. A. MacDonald. Using economic analysis, discuss the likely impact of that tariff on the size and the structure of the Canadian economy, as well as on per capita income. 41. In 1878 Canada chose a leader who introduced a highly protective tariff for Canadian industry. Discuss the advantages and disadvantages of this tariff for 4 Canadian development from 1878 to World War I. 42. The introduction of the protective tariff may have led to an increase in the extent of monopoly in Canada. Using the appropriate diagram explain how the changes in the cotton textile industry described in ' T. W. Acheson,'The National Policy and the Industrialization of the Maritimes, 1880-1910', Acadiensis, 1 (1972) may have been stimulated by the introduction of the national policy tariff. 43. During the early nineteenth century, both Upper Canada and Lower Canada invested in a number of canals, but a complete system of canals along the St. Lawrence River was only finished in the 1840s after unification of the two colonies. Explain the benefits of improvements in transportation to an economy and discuss the reasons why the Lower Canadian legislature was less willing to invest in canals along the St. Lawrence than the Upper Canadian legislature. 44. During the early 19th century, transportation improvements were introduced through railroad and canal building and local road construction. What was the likely impact of these changes on the income of merchants, farmers, and manufacturers? 45. Railroads were the high technology industry of the mid 19th century. Discuss the impact of railroad development on the economy of Canada, considering both the impact of the improvements in transportation offered by the railroad and the impact of the production of rail services themselves. 46. The Canadian government played a large role in the development of a Railroad network. Describe this role from the 1840s to the 1920s. What were the disadvantages for economic efficiency of the size and routes of the rail network, and was acceptance of these disadvantages justified by other factors? 47. From the middle of the 19th century to the early 20th century railroads were either constructed by government directly or were subsidized by government. Briefly discuss the economic rationale for government involvement in railroad construction and discuss the impact financing of railroads had on government finance, tariff policy and on confederation. 48. In the late 19th and early 20th centuries Canada constructed an extensive network of transcontinental railroads. Discuss the implications for the overall economic development of Canada of the choice of routes, the timing and the financing of these railroads. 49. When the Canadian Pacific Railroad was built, it received a large subsidy from the federal government. Given the information available in the early 1880s, discuss whether or not such a large subsidy was appropriate and consider the merits of alternatives to building a privately owned subsidized railroad ahead of settlement. 50. The availability of low cost transportation is essential to economic development, but a transportation system also has an important political and military impact on a region. Discuss construction of a railway system from St. John and Halifax to Vancouver in the post-confederation period, considering the extent to which the necessity that the railroad serve political and military functions increased the cost to 5 Canadians of obtaining rail service. 51. Governments in Canada have always helped to create transportation networks. Trace the role of government in financing, building or defending transportation routes from the fur trade to World War I, discussing the extent to which political or military factors took precedence over economic efficiency. 52. The Canadian government adopted a number of policies in the post-confederation period to encourage the settlement of the Canadian prairies. Briefly describe these policies and explain in detail why extensive settlement of the prairies occurred only after 1895. 53. The wheat boom began only in the later 1890s, but policy devised to stimulate settlement in the Canadian prairies had been in place for one to two decades. Describe the policies intended to encourage settlement of the Canadian prairies and explain why settlement did not begin until the very end of the century. 54. Although the Dominion Land Act was passed in 1879 and the Canadian Pacific Railroad was completed into the prairies by 1884, extensive settlement of the West was delayed until the late 1890s. Discuss the reasons for this delay in settlement of the West. 55. The staples thesis has played a key role in the study of the Canadian economy, and wheat has often been assumed to be the ideal staple which was responsible for the very rapid growth in income during the period from the mid 1890s to World War I. Discuss the extent to which wheat production stimulated rapid growth in per capita income, and the extent to which other industries played a crucial role in the dynamic economy of those years. 56. Canada enjoyed a major economic expansion from 1895 to 1913. Discuss the economic factors which led to this prosperity throughout Canada and consider whether the staples theory provides an adequate explanation of the period of growth. 57. The late nineteenth century was a period of dramatic changes in technology and exploitation of new natural resources. Discuss the impact these changes had on the capital intensity of production, on foreign ownership of Canadian industry and on the integration of the Canadian and the American economies. 58. A central fact of the contemporary Canadian economy is the concentration of manufacturing in Ontario and Quebec and the failure of the Maritimes to sustain a manufacturing sector. The staples thesis has been used to explain the emergence of this distribution of economic activity, but the livelihood thesis argues that the distribution of agricultural resources in Canada may have been a determining factor. Explain how the distribution of natural resources across Canada helped to determine this pattern of economic development from the beginnings of settlement into the 1920s. 59. Describe changes in the rates of growth of GDP, investment and exports in the Canadian economy between Confederation and World War I. Explain the role of the 6 development of wheat production on the pattern of growth. 60. During the late nineteenth century, firms grew dramatically in size and manufacturing became increasingly concentrated in particular urban centres. Explain how changes in economies of scale and transportation costs encouraged these changes. 61. At the time of confederation, the Maritime economy was to a large extent based on fishing, timber, shipbuilding and commerce. Discuss the impact of the National Policy and of revisions of the policy in the 1920s on the economic development of the Maritimes. 62. 'In fact, the decade following 1879 was characterized by a significant transfer of capital and human resources from the traditional staples into a new manufacturing base which was emerging in response to federal tariff policies. ' T. W. Acheson, 'The National Policy and the Industrialization of the Maritimes, 1880-1910', Acadiensis, 1 (1972) p. 3. Discuss the types of industries which appeared in the new manufacturing base and explain why the tariff stimulated the shift of capital and human resources described in the quote. 63. Maritimers have been known to complain that Confederation was destructive to their economy. The national policy tariff brought in by J. A. MacDonald has been closely associated with Confederation and the construction of a national economy. Discuss the advantages and the disadvantages of the tariff to the Maritime economy. 64. Maritimers often believed that their economy enjoyed a 'golden age' in the preconfederation period, but that it has suffered economic decline ever since confederation. Discuss the economic circumstances from 1867 to the inter-war era which caused major structural changes in the Maritimes economy. 65. Atlantic Canada has persistently experienced lower income per capita than other regions of Canada. Describe the nature of the Maritimes economy in the early 19th century and discuss the changes in that economy through World War II, analysing the impact of Canadian tariff and transportation policy on the region's development. 66. At Confederation, many observers believed that the Maritimes would become an industrial heartland of the new Canadian nation. Instead, the Maritimes became a relatively underdeveloped part of Canada with significantly lower per capita income and persistent out migration. Outline the pattern of economic development in the Maritimes and discuss the reasons why the Maritimes did not fulfil the expectations of so many at confederation. 67. In the late nineteenth and early twentieth century manufacturing displayed a strong tendency to cluster in particular regions of each nation. Discuss the economic forces which tended to lead to the clustering of manufacturing activity and explain the impact of these economic forces on the economic development of the Maritimes and Central Canada. 68. The Great Depression of the 1930s led to a prolonged period of unemployment and 7 poor economic performance. Discuss both the monetary and real events of the 1920s which caused the Depression and discuss the impact of the depression on the Canadian economy of the 1930s. Explain how the experience with the Depression influenced attitudes towards government management of the economy. 69. During the 1920s Central Canada experienced a boom, particularly in manufacturing, while the Maritimes experienced hard economic times. All of Canada suffered from difficult economic circumstances during the 1930s, which ended with rearmament and production for war during World War II. At the end of these decades, Central Canada clearly dominated manufacturing in Canada, while the Maritimes had become a natural resource producing hinterland. Explain why these regions experienced such different fates. 70. During the 1930s the Canadian economy experienced a dramatic decline in output, prices and employment. Discuss the real and the monetary factors which contributed to this decline. 71. The depression of the 1930’s created extensive unemployment in Canada. Discuss the distribution of this unemployment across regions, occupations and gender and evaluate the effectiveness of government responses to high and persistent unemployment. 72. Describe the pattern of the business cycle in Canada from the mid 1920's to the 1980's, explaining how this economic experience first led to the adoption of Keynesian economic policies and then led to disillusionment with such policies. 73. After World War II, Canada experienced an era of strong economic growth with low unemployment and inflation rates. Describe the evolution of monetary policy during that era and explain the determination of the independence of the Bank of Canada and the changes in circumstances which resulted in the end of the boom and the inflation of the 1970s. 8 Readings in addition to the text book. Readings Assigned to Dec. 3, 1999: M.H. Watkins, 'A Staple Theory of Economic Growth', from Canadian Journal of Economics and Political Science, 29 (1963), pp. 141-158, M. Altman ‘Seigneurial Tenure in New France, 1688-1739: An Essay on Income Distribution and Retarded Economic Development’ Historical Reflections 10 (1983), pp. 335-75 Graeme Wynn, 'Late Eighteenth Century Agriculture on the Bay of Fundy Marshlands', Acadiensis 8, 1979. Marvin McInnis, 'Marketable Surpluses in Ontario Farming, 1860' Social Science History, 4 (Fall, 1984), pp. 395-424 reprinted in McCalla, pp. 37-58. T.J.A. LeGoff, 'The Agricultural Crisis in Lower Canada, 1802-12: A Review of a Controversy', The Canadian Historical Review, 55 (1974), pp. 1-31, reprinted in McCalla, pp. 10-36. T.W. Acheson, ‘The Great Merchant and Economic Development in Saint John, 18201850’, Acadiensis, 8 (1979). D.F. Barnett, ‘The Galt Tariff: Incidental or Effective Protection?’ Canadian Journal of Economics, (1976), pp. 389-407. Paul Craven and Tom Traves, 'Canadian Railways as Manufacturers, 1850-1880', Historical Papers, (1983), pp. 254-81, reprinted in McCalla, pp. 118-143. READINGS ASSIGNED TO FEB. 22 Peter George, 'The Rates of Return in Railway Investment and Implications for Government Subsidization of the Canadian Pacific Railway: Some Preliminary Results', Canadian Journal of Economics, 1 (1968) pp. 740-62 reprinted in McCalla, pp. 144-165. Glen Williams, 'The National Policy Tariffs: Industrial Development through Import Substitution', The Canadian Journal of Economics and Political Science, 30:2 (June, 1979), reprinted in Laxer, pp. 158-92. T.W. Acheson, 'The National Policy and the Industrialization of the Maritimes, 1880-1910', Acadiensis, 1 (1972), pp. 3-28, reprinted in Laxer, pp. 228-266. K. H. Norrie, 'The Rate of Settlement of the Canadian Prairies, 1879-1911', Journal of Economic History, 35:2 (June 1975), pp. 410-27, reprinted in McCalla, pp. 168-81. READINGS TO END OF YEAR. E. R. Forbes, 'Cutting the Pie into Smaller Pieces: Matching Grants and Relief in the Maritime Provinces During the 1930s', Acadiensis, 13 (1983), pp. 112-25, reprinted in Challenging the Regional Stereotype, E.R. Forbes, (Acadiensis Press, Fredericton, N.B., 1989). David A. Wolfe, 'The Rise and Demise of the Keynesian Era in Canada: Economic Policy, 1930-1982', Modern Canada 1930-1980's edited by Michael S. Cross and Gregory S. Kealey, (Toronto, 1984), pp. 46-78. (On reserve) 9