EC 200 Lecture 01

1. Heilbroner: Chapters 1 and 2
EC 200
Rondi A. Schei

2. Outline

 What are world changing ideas?
 Why is a knowing person’s background important?
 How were early societies organized?
 How does the market system organize society?
 What are the different economic systems?

3. World Changing Ideas

 Heilbroner finds it strange that people do not know
much about these men; in fact, most do not even
know who they are.
 Class Activity
 Name other men who have changed the world. No
repeats.
 How is it possible that these men could change the
world and no one remember who they are?
 What do you think constitute “world changing ideas?”
 Can you predict some of the world changing ideas
that will be mentioned in Heilbroner’s book?

4. Importance of Background

 Heilbroner mentions a group of nine mend from
different walks of life and calls them: a
philosopher, a madman, a cleric, a stockbroker, a
revolutionary, a nobleman, an aesthete, a
skeptic, and a tramp.
 Small Group Activity: (15 min)
 What theme could emerge from this statement?
 What is Heilbroner trying to say by pointing out the
men’s disparate backgrounds?
 Considering the importance of their ideas, why are
their individual stories important?

5. Early Survival

 How societies organized by tradition and the role of
cooperation.
 Small Group Activity: (20 min)
 Your group is an individual society. Discuss how you
would organize your traditional society.
 Create a diagram on the board demonstrating to the class
how you propose to survive by using tradition.
 Class Discussion:
 What problems are posed by the fact that man must work in
groups and cooperate with others in order to achieve certain
accomplishments?
 How does the fact that man is self-centered make this
difficult?
 What was the major impetus in early societies that helped
man overcome this difficulty?

6. Emergence of the Market System

 Economics came into existence as a result of the third way
of dealing with the survival problem and that was by
letting everyone do what they wanted within a prevailing
framework.
 Small Group Activity: (20 min)
 Create a timeline for the emergence of the market system.
Include brief descriptions. Any artwork is ok.
 Draw your timeline on the board and compare with other
groups.
 Class Activity:
 Discuss how this system functioned by everyone doing
what was in their own best financial interests?
 Does the system provide guarantees that all of the tasks
would be performed or that there would be people to
perform the tasks?

7. Different Economic Systems
 Feudalism

 is an economic system based on tradition and dominated the Western
world from the 8th to the 15th century
 Mercantilism
 an economic system in which the government controls economic
activity by doling out the rights to undertake economic activities and
was dominant until the 18th century
 Capitalism
 an economic system based on the market in which the ownership of
the means of production resides with a small group of individuals
(called capitalists)
 Welfare Capitalism
 above + governments that regulated capitalistic abuses and
provided economic safety nets.
 Socialism
 an economic system based on individuals’ goodwill towards
others, not on their own self-interest, and in which, in principle, society
decides what, how, and for whom to produce

8. Conclusion

 Concepts, ideas, social norms that we take for
granted today are due to great thinkers of the past.
 Societies require an organizational framework so
that they can thrive.
 Capitalism evolved due to its flexibility when faced
with societal changes.

9. Upcoming

 Post a response to the discussion forum by this
Friday at 4pm.
 Discussion replies must be made before class on
Monday (4pm).
 Reading Quiz due Monday at 4pm over Heilbroner
Chapters 3 and 4.