TheThe Industrial Industrial RevolutionRevolution

The Industrial RevolutionThe Industrial Revolution

• Economic changes in Britain that Economic changes in Britain that spread to the rest of the World.spread to the rest of the World.

• Major changes in where people Major changes in where people lived, working conditions and lived, working conditions and standards of living because of standards of living because of the Industrial Revolution.the Industrial Revolution.

The Industrial RevolutionThe Industrial RevolutionMake a list of 10 things that you notice in this pictureMake a list of 10 things that you notice in this picture

Essential QuestionsEssential Questions

• How does the free enterprise How does the free enterprise system work?system work?

• What factors caused the What factors caused the Industrial Revolution?Industrial Revolution?

• How did the Industrial How did the Industrial Revolution change the ways Revolution change the ways people lived?people lived?

Wednesday, February 8, 2012Wednesday, February 8, 2012• What group redrew the map of Europe following the What group redrew the map of Europe following the

Napoleonic Wars in order to restore a balance of Napoleonic Wars in order to restore a balance of power? power? – Congress of ViennaCongress of Vienna

• Who lead the independence movements in Who lead the independence movements in Venezuela, Columbia, Peru and Bolivia?Venezuela, Columbia, Peru and Bolivia?– Simon BolivarSimon Bolivar

• What reform movement attempted to end the What reform movement attempted to end the practice of slavery?practice of slavery?– AbolitionAbolition

• In what year did Mexico gain its independence from In what year did Mexico gain its independence from Spain?Spain?– 18211821

• What did Napoleon sell to the United States in 1803?What did Napoleon sell to the United States in 1803?– LouisianaLouisiana

Monday, February 13, 2012Monday, February 13, 2012• What movement were Locke, Rousseau, Montesquieu, What movement were Locke, Rousseau, Montesquieu,

Hobbes and Voltaire a part of? Hobbes and Voltaire a part of? – The EnlightenmentThe Enlightenment

• Name three leaders of Latin American independence Name three leaders of Latin American independence movements?movements?– Simón Bolívar, José San Martín, Toussaint L’Ouverture, and Simón Bolívar, José San Martín, Toussaint L’Ouverture, and

Miguel HidalgoMiguel Hidalgo

• Who was the author of Who was the author of The Wealth of NationsThe Wealth of Nations??– Adam SmithAdam Smith

• Who advocated using violence against his political Who advocated using violence against his political opponents during the Reign of Terror during the opponents during the Reign of Terror during the French Revolution?French Revolution?– RobespierreRobespierre

• What is an ABSOLUTE MONARCH?What is an ABSOLUTE MONARCH?– Hereditary Rulers (ex. King) with unlimited and unchecked Hereditary Rulers (ex. King) with unlimited and unchecked

powerpower

E C O N O M I C SE C O N O M I C S

• describes how people meet their describes how people meet their needs by making, distributing needs by making, distributing and using goods and servicesand using goods and services

E C O N O M I S T SE C O N O M I S T S

study how peoplestudy how people– work and earn moneywork and earn money– save and invest moneysave and invest money– Use their time, energy and satisfy Use their time, energy and satisfy

their needstheir needs

Free Enterprise SystemFree Enterprise System

the freedom to make their own the freedom to make their own choices in deciding what to buy, choices in deciding what to buy, where to work, and what to where to work, and what to make.make.

Individuals are free to make their Individuals are free to make their own economic decisions.own economic decisions.

Free Enterprise SystemFree Enterprise System

People own property.People own property.

Some people invest in order to Some people invest in order to make make profitsprofits

ProfitProfit - extra money that is made - extra money that is made after all expenses are paid.after all expenses are paid.

Free Enterprise Free Enterprise • Several producers Several producers

make same goods make same goods or provide same or provide same servicesservices

• Gives consumers Gives consumers choices.choices.

• Improves quality Improves quality and reduces and reduces prices.prices.

Free EnterpriseFree Enterprise

• What is the What is the ROLE ROLE OF GOVERNMENT?OF GOVERNMENT?

• Government Government interference is interference is LIMITED!!!!!!!!!!!LIMITED!!!!!!!!!!!

Free Enterprise Free Enterprise

• Government Government – Supplies some Supplies some

servicesservices– Sets rulesSets rules– Settles economic Settles economic

disputesdisputes

Free EnterpriseFree Enterprise

• PRODUCERSPRODUCERS– Those that make Those that make

and sell servicesand sell services

• CONSUMERSCONSUMERS– Those that buy Those that buy

and use goods and use goods and servicesand services

Free EnterpriseFree Enterprise• LAW OF LAW OF SUPPLYSUPPLY

& & DEMANDDEMAND

– SUPPLY is how SUPPLY is how much producers much producers make availablemake available

– DEMAND is how DEMAND is how much of a product much of a product consumers are consumers are willing to buywilling to buy

A D A M S M I T HA D A M S M I T H

The Prophet of Free The Prophet of Free EnterpriseEnterprise

The Wealth of The Wealth of NationsNationsPublished 1776Published 1776

The PROPHET OF PROFITSThe PROPHET OF PROFITS

The Wealth of NationsThe Wealth of Nations

• Smith explained Smith explained – The benefits of The benefits of

division of labordivision of labor– How supply and How supply and

demand determine demand determine pricesprices

– How inefficient How inefficient businesses fail businesses fail

– Successful Successful businesses sell the businesses sell the best goods sell at best goods sell at the best pricesthe best prices

The Wealth of NationsThe Wealth of Nations

• Smith arguedSmith argued– That each person That each person

pursues his or her pursues his or her own interest. Soown interest. So

– An An INVISIBLE HANDINVISIBLE HAND guides individual guides individual actions that actions that benefits the benefits the economy. economy.

The Wealth of NationsThe Wealth of Nations

• Smith argued for Smith argued for – LAISSEZ-FAIRE LAISSEZ-FAIRE

(hands-off) (hands-off) economic policyeconomic policy

– The government The government does NOT interfer does NOT interfer with the economy.with the economy.

The Wealth of NationsThe Wealth of Nations

Quote 1Quote 1

“ “The market price of every particular The market price of every particular commodity is regulated by the commodity is regulated by the proportion between the quantity proportion between the quantity which is actually brought to market, which is actually brought to market, and the demand of those who are and the demand of those who are willing to pay the natural price of the willing to pay the natural price of the commodity.”commodity.”

• What is Smith attempting to explain?What is Smith attempting to explain?

The Wealth of NationsThe Wealth of NationsQuote 2Quote 2 “ “As every individual, therefore, endeavors as As every individual, therefore, endeavors as

much as he can both to employ his capital in much as he can both to employ his capital in the support of domestic industry, and so to the support of domestic industry, and so to direct that industry that its produce may be direct that industry that its produce may be of the greatest value; every individual of the greatest value; every individual necessarily labors to render the annual necessarily labors to render the annual revenue of the society as great as he can. He revenue of the society as great as he can. He generally, indeed, neither intends to generally, indeed, neither intends to promote the public interest, nor knows how promote the public interest, nor knows how much he is promoting it.”much he is promoting it.”

• What is Smith attempting to explain?What is Smith attempting to explain?