21 september 2015 by sigrid brevik wangsness. i. 18 th century economic reasons for the war of...
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21 September 2015by
Sigrid Brevik Wangsness
I. 18th Century Economic reasons for the War of Independence (1775-1783)
Agriculture as the main economic activity
The Industrial Revolution and development of a modern economy
How can we explain the tremendous growthof the US economy since the early 19th century?
1 6 The free-enterprise system (Adam Smith)
2 7
3 8
4 9
5 10
Focus on opportunity to succeed through:
1.
2.
3.
4.
◦Poor immigrant from Scotland
◦From factory worker to one of the richest men in the world
◦Founded a steel company, consolidated the steel industry
◦A philanthropist
Development of corporations
a)Why did corporations replace many family businesses and partnerships in the US?
b)How did the giant corporations develop?
b)Consolidation in major industries: oil, steel, railroads
To what extent did the US government intervene in the economy in the 20th century?
1. Early 20th century
oTariffs
oTrust busting
o1913: The Federal Reserve (The Fed)
2. The Roaring 20soGrowth in mass production and consumptiono ProhibitionoSpeculation on the stock market
3. The crash in October 1929 o Why?
4.The Depression of the 1930so25% unemployment, extreme poverty
5. The New Deal o The election of Franklin D. Roosevelt in 1932• Creating jobs• Social Security• Regulation of finance
o The three Rs:• Relief• Recovery• Reform
Roosevelt was influenced by a new economic theory: A managed economy
John Keynes: The General Theory of
Employment, Interest and Money (1937)
6. World War IIoGovernment control of large parts of the economyo Full employmentoConsensus
7. The Post-War Period
How has Big Business profited from co-operation with the US government?
Major growth of the US economy from 1945-1970
World economic dominance
Sustained growth in the 50s and 60s
Consolidation in the 60s
Mid-1970s: Stagflation and recession New economic theory: Monetarism
Milton Friedman – the ”Chicago school” of economics
”Supply-side” economic theory (1970s/80s)
1980s: The decade of the Yuppies Economic growth, but at a slower pace towards the end of the period.
Ronald Reagan: 1980-88
Continued shift in the workforce from manufacturing to services and high-tech.
Declining number of workers, but increased production and efficiency.
Development of conglomerates and multinationals.
From being the world’s biggest creditor the US became the biggest debtor.
Foreign investment inside the USA became greater than US investment abroad.
Deregulation: fewer restrictions and less government intervention
1987: Stock market crash. World recession
1990 - 1992: Recession. George Bush Sr. Signs of recovery at the end of his term.
1993 - 2000: Growth. Boom. Bill Clinton. Eight years of
uninterrupted growth. Signs of decline at
the end of his term.
2000/2001: "The new economy” (dot.com shares) "A bubble economy”?
The IT bubble burst: Prices of IT shares dropped dramatically
A major slowdown of the US economy
Sectors of the economy sliding into recession
September 11th 2001
2002 - early 2003: Signs of recovery, but sluggish
2003 - 2007: Relative growth (GDP: 2.6% in 2007), stability and relatively
low unemployment (4.7% in 2007).
2008 – 2009: Financial crisis. Recession
2009 - 2013: Slow recovery
2014: 2.5% growth, but economic data difficult to interpret.
2015: Better than it looks?