Prof. J. McFarland Fall 2007
Aquinas Programme: Justice and Globalization
Economics 1006 J
Introduction to Economics
Seminar description: The objective is for students to begin to gain an understanding of how both the Canadian economy and the global economy work. You will be introduced to both political economy and neo-classical approaches to Economics. This is important for your understanding of the subject. As well, it will prepare you for later courses in Economics since we offer two different honours programs in Economics- one for each approach- and have upper year courses using both approaches.
Texts:
Joanne Naiman, How Societies Work: Class, Power, and Change in a Canadian Context,
3rd edit. Thomson/Nelson, 2004
A. O'Sullivan, S. Sheffrin and R. Moir, Microeconomics: Principles and Tools, First Canadian edition: Pearson/Prentice Hall, 2001 (Chapter 4 to be handed out in class)
Michael Parkin and Robin Bade, Macroeconomics: Canada in the Global Environment, 5th edit. Pearson/Addison Wesley, 2003 (pp 34-39, 42-45 to be handed out in class)
Class format: In order to keep your interest and accommodate different learning styles, we will use a number of different formats in the class. These will include lectures (by me) and discussions and exercises (both class and small group).
Assignments/Seminar grades: You will receive "didits" for your attendance and assignments in the seminar. I will give you feedback on the level of economic literacy that I feel that you are showing in your assignments, although not a grade. Later I will be looking for a demonstration of economic literacy in your answers to the questions that I put on your learning reflections assignment.
OUTLINE/CLASS
SCHEDULE
First
term seminar
Sept. 27 Introduction to economics and political economy
What is capitalism?
Assigned reading: Naiman, preface, pp13-16, 332-339
Oct. 2 Capitalism and other Economic Systems
Assigned reading: Naiman, Chpt. 4
Oct. 9 Contemporary Capitalism
Assigned reading: Naiman, Chpt. 5
Oct. 11 Contemporary Capitalism cont'd
Oct. 16 Neo-classical analysis of the market: Demand and Supply
Assigned reading: O'Sullivan et. al., Chpt. 4
Oct. 18 Demand and Supply cont'd
Oct. 23 & 25 Neo-classical theory of gains from trade: Theory of Comparative Advantage
Assigned reading: Parkin & Bade, pp 34-39, 42-45
Oct. 30 Wrap-up
Assigned reading: Naiman, Chpt. 7, especially the section on media
Second
term seminar
Feb. 12 Introduction
to macroeconomics and the macroeconomy
Macroeconomic indicators: rate of
growth of the economy
(ref. indicators handout)
Feb. 14 Macroeconomic
indicators: rate of unemployment
(ref. indicators handout)
Feb. 19 Macroeconomic
indicators: rate of inflation
(ref. indicators handout)
Feb. 21, 26 & 28 A macroeconomic model: Aggregate demand and
supply
(ref. O'Sullivan, Ch. 9 )
Mar. 11 & 13 The macroeconomy and the role of the state
in a capitalist economic system
(ref. Naiman, Ch. 8)
Mar. 18 & 20 Capitalism and globalization
(ref. Naiman, Ch. 9; Globalization:
Who's Winning and Who's Losing? Canadian
Labour Congress, 2004)
JUSTICE AND GLOBALIZATION
ECONOMICS SEMINAR, SEMESTER 1
PROMPT 1
We will begin the seminar by reading and discussing Chapters 4 and 5 of
Naiman’s How Society Works.
Suggestions for reading Naiman:
1. Make (copious) notes.
2. Focus on her themes and the analysis and evidence she presents to
back them up.
Assignment for Tuesday, Oct. 2
After carefully reading the first part of Naiman, Chpt. 4
(pp76-87) on feudalism and the transition to capitalism, select what
you consider to be her themes. (These may be quotes.) Choose one of
these themes, and describe the analysis and evidence that she provides
to back it up.
Your answer should be approximately 250 words long, word
processed, properly formatted and referenced (e.g. Naiman, p 85).
You will discuss your work in small groups and as a class and then it
will be passed in for a “didit� and some feedback.
Assignment for Tuesday, Oct. 9
After carefully reading the second part of Naiman, Chpt. 4 (pp87-101)
on the capitalist economic system (or socioeconomic formation), select
what you consider to be her themes. (These may be quotes.) Choose one
of these themes, and describe the analysis and evidence that she
provides to back it up.
Your answer should be approximately 250 words long, word
processed, properly formatted and referenced (e.g. Naiman, p 85).
You will discuss your work in small groups and as a class and then it
will be passed in for a “didit� and some feedback.
JUSTICE AND GLOBALIZATION
ECONOMICS SEMINAR, SEMESTER 1
PROMPT 2
Assignment for Thursday, Oct. 11
After carefully reading Chapter 5 in Naiman on contemporary capitalism,
select and present what you consider to be her themes. (These may be
quotes.) From among these, choose what you consider to be her main
theme, and describe the analysis and evidence that she provides to back
it up.
Your answer should be 250-350 words long, word processed,
properly formatted and referenced (e.g. Naiman, p 85). You will discuss
your work in small groups and as a class and then it will be passed in
for a “didit� and some feedback.
JUSTICE AND GLOBALIZATION
ECONOMICS SEMINAR, SEMESTER 1
PROMPT 3
Assignment for Tuesday, Oct. 16
Reflect on the parable contained in the reading, “Origins of
the
Worker-Capitalist Relationship� in relation to our theme of
inequality
in capitalist economic systems. (Show your “economic
literacy� in
your reflection.)
We will share what you have written in Tuesday’s class after
which you
will pass in your work for a “didit�.
JUSTICE AND GLOBALIZATION
ECONOMICS SEMINAR
PROMPT 4
Assignment for Oct. 22
After having carefully studied the chapter from OSullivan on
demand
and supply analysis, do the multiple choice questions at:
http://www.prenhall.com
Email me your results by 9am, Monday, Oct. 22.
Instructions for finding questions:
http://www.prenhall.com
Select a discipline (at top)- Economics
Choose Principles of Economics (on left side)
Choose companion website under Microeconomics:
Principles, Applications and Tools, 5th edit (on left sidebar)
Under the above title, choose companion website again
Select Chapter 4 (at top)
Choose practice quiz
JUSTICE AND GLOBALIZATION
ECONOMICS SEMINAR
PROMPT 5
In the last few classes, we have been looking at two basic models of
neo-classical economics: demand and supply and comparative advantage..
The demand and supply model is behind the neo-classical defence of the
market as solving all economic problems. The comparative advantage
model is behind the neo-classical defence of free trade. The purpose is
for you to study these models and grasp how they work but also to
consider the critiques of them in relation our justice and
globalization theme.
Assignment for Tuesday, Oct. 30
1. Study carefully the pages from Parkin and Bade on the PPF,
opportunity cost, marginal cost and benefit, and comparative advantage.
Try to answer the questions in the Review Quizzes on pp 36 and
45.
2. Read Chapter 7, The Social Construction of Ideas and
Knowledge, in
Naiman, How Society Works.
JUSTICE AND GLOBALIZATION
ECONOMICS SEMINAR
PROMPT 6
Feb.12
Working with your partner, answer the following questions on the
clippings in your rate of growth of the economy handout.
1. What was Canada's GDP in Nov. 2007? Explain. What was the rate of
growth of the economy in 2007? Explain.
2. What is the growth prospect for Canada? for the US? for India? for
China? for Europe? for Asia? for Africa?
3. How does Canada's growth in the west compare with that in the east?
Why?
4. Is a recession forecast for Canada in 2008? for the US? What is a
recession? Why is a recession "only whispered about"?
5. Who, or which bodies, are making the forecasts? What do you know
about each of them? Does it make any difference?
JUSTICE AND GLOBALIZATION
ECONOMICS SEMINAR
PROMPT 7
Feb. 14
Working with your partner, answer the following questions on the
clippings in your employment/unemployment handout.
1. Assess NB's employment/unemployment situation in Oct. 2007. Use each
of the indicators in Table 1 from Statistics Canada in your answer.
2. How did NB's rate of unemployment compare with that in other
provinces in Oct. 2007? Explain what is meant by a seasonally adjusted
rate.
3. How did unemployment in NB compare by age group and gender in Oct.
2007?
4. What was the US unemployment situation in Dec. 2007?
5. What were the Jan 2008 unemployment figures? How are they
interpreted by Ed Doherty, NB Minister of Labour? How are they
interpreted by Samuel LeBreton, economist at Service Canada?
6. What is the current pattern of job loss and growth in the Canadian
economy according to the 7/11/07 article? What is the reason for it?
Assess it in political economy terms. What is the tone of the
discussion in the article?
JUSTICE AND GLOBALIZATION
ECONOMICS SEMINAR
PROMPT 8
Feb.19
Answer the following questions on the
material in your handout on the rate of inflation.
1. What was Canada's inflation rate in November 2007? What
was the "core inflation rate" for Nov. 2007? What is the "core
inflation rate"? What is the significance of the difference in
and the direction of change of the two rates?
2. What relation is suggested between the rate of inflation and the
value of the loonie? What relation is suggested between the
rate of inflation and the Bank of Canada interest rate? What do you
think of the expression "the strength of the loonie"? What does it
imply?
3. What was the rate of inflation in New Brunswick in November 2007?
How does it compare with that in the other provinces? Why would it be
different?
4. What was the rate of inflation in Canada in 2007? Had it gone
up or down since November 2007? What was the core rate of
inflation in December 2007? Had it gone up or down since
the previous month?
5. Interpret the Statistics Canada graph on "percentage changes".
6. What was the rate of inflation in the United States in 2007?
What had it been in 2006? What were the main reasons for the rise?
JUSTICE AND GLOBALIZATION
ECONOMICS SEMINAR
PROMPT 10
(not given 2008)
STATISTICS CANADA ASSIGNMENT
VISIT THE STATISTICS CANADA WEBSITE
(www.statcan.ca). USING THE DATA THAT YOU FIND THERE AND THE
MACROECONOMIC INDICATORS WE HAVE DISCUSSED, WRITE AN ESSAY ON THE
PRESENT STATE OF THE CANADIAN ECONOMY. EXPLAIN THE MEANING AND
SIGNIFICANCE OF THESE INDICATORS AS YOU GO ALONG. IF YOU WERE THE
MINISTER OF FINANCE AND/OR THE GOVERNOR OF THE BANK OF CANADA, WHAT
POLICIES WOULD YOU BE USING AND WHY?
FULLY DOCUMENT EACH STATISTIC THAT YOU INCLUDE IN YOUR
ESSAY IN A FOOTNOTE WITH REFERENCE TO A SPECIFIC WEB PAGE AND
DATE
OF RETRIEVAL.
For example: Retrieved Feb. 28, 2008 from http://www.statcan.ca/Daily/English/061031/d061031a.htm
LENGTH: 300-400 WORDS
POST THE FILE AS "StatCan.htm" ON WEBCT. BRING A
PRINT OUT WITH YOU TO TUESDAY'S CLASS.
JUSTICE AND GLOBALIZATION
ECONOMICS SEMINAR
PROMPT 10
Feb. 21
Questions on the monetary policy
clippings in the handout. BRING WRITTEN ANSWERS TO CLASS ON TUESDAY.
1. Who is the new Governor of the Bank of Canada? What will he be
responsible for? How is he expected to do?
2. According to the 21/9/07 article, what are the reasons for
value of the loonie changing from less than $US .62 in early 2002 to
$US 1.00 (or parity) in Sept. 2007?
3. According to the 31/12/07 article, who won and who lost from the
changes in the value of the loonie? Explain.
4. What was the Bank of Canada key interest rate in January, 2008? Had
it been cut or raised? Why? (See the 17/01/08 article)
Question re the Stanford article from the CCPA Monitor.
POST ON WEBCT AS "GUSHMORE" AND BRING A HARD COPY TO CLASS ON
TUESDAY.
What does Stanford think of Canada's
recent economic policies which he sees as having resulted in a
"Gushmore" and "Habeenia" in Canada? (Your answer should be
approximately 250 words.)
JUSTICE AND GLOBALIZATION
ECONOMICS SEMINAR
PROMPT 11
Feb. 26
Part I
Questions on monetary and fiscal
policy based on CCPA The Monitor
articles in your handout.
Each answer should be 200-250 words
long. Post your answers on WEBCT and bring a hard copy to Thursday's
class.
Jackson article (Dec. 07-Jan.
08)
What does Jackson think of Canada's current interest rate and exchange
rate policies? Why? What would he recommend?
Brooks and Hwong article
(Feb. 07)
How does the CCPA study compare the impact of high and low tax rates
for countries? What do the authors conclude? Are you convinced? Why or
why not?
What are the implications for Canada?
Part
II
Check out the CCPA Alternate Budget on their website:
www.policyalternatives.ca
and bring a Feb. 27
newspaper to class on the Feb. 26 federal budget.
Justice and Globalization
Economics Seminar
Prompt 12
Feb. 28
The
2008 Federal Budget
Using the newspapers that you have brought, answer the following
questions about the 2008 federal budget.
1. What kind of budget is it? What
is the amount of the surplus or deficit? What is going to be done with
it? Is this good fiscal policy?
2. What are the major expenditure changes in the budget?
3. What are the major tax changes in the budget?
4. What has been the reaction to the
budget by business? by the CCPA? by poverty groups? by students? by the
NDP? by the Green Party? by New Brunswick? by cities?
For next day, March 11, read Chapter 8 in Naiman on the state.
Based on today's lecture and Chapter
9 of O'Sullivan et al,
prepare answers to
the following questions to bring to class on Thursday. Use graphs where
appropriate.
1. Briefly describe the nature of the aggregate demand and supply model
as you understand it. What are the controversies that surround it?
2. Using demand and supply analysis from microeconomics, show how
prices are supposed to coordinate economic activity. Then discuss how
failures in this coordination may occur (and affect the macroeconomy).
3. In terms of the aggregate demand curve in the aggregate demand and
supply model,
i) what determines its slope? Explain
ii) what causes it to shift? Explain
JUSTICE AND GLOBALIZATION
ECONOMICS SEMINAR
PROMPT 11
These are a continuation of the questions on the macroeconomic model we
are studying. The instructions are the same as in prompt 10
except that you need to bring these answers to next class.
Instructions: Based on today's lecture, Chapter 9 of O'Sullivan et al and the Keynes video
we saw, prepare answers to
the following questions to bring to class on Tuesday. Use graphs where
appropriate.
4. Discuss the difference between the classical aggregate supply
curve and the Keynesian aggregate supply curve. Draw them
labelling properly.
5. Putting aggregate demand and supply together and finding equilibrium
output and price levels, what are the different policy implications of
the different aggregate supply curves? Draw the different situations
(again labelling properly).
6. What role does the concept of the natural rate of unemployment play
in the classical analysis? Explain.
7. Based on the Keynes video we saw in class, "John Maynard Keynes:
What Did We Learn from the Great Depression?", discuss Keynes'
contribution in showing how an economy could be stabilized in the face
of unemployment.
JUSTICE AND GLOBALIZATION
ECONOMICS SEMINAR
PROMPT 12
Please do the following assignment which is to be handed in for marking at next class.
Aggregate Demand and Supply Exercise
1. Draw a graph and explain the effect of the following on the
aggregate demand curve:
i) an increase in the price level
ii) an increase in social spending by government
2. Starting from an equilibrium position, draw and explain the impact
of the following on the price level and output:
from the classical perspective
i) an increase in the supply of money
ii) a tax cut
from the Keynesian perspective
i) a decrease in government spending
ii) an increase in exports
3. What would bring about a shift in the long-run aggregate supply
curve? Explain.
4. Draw and compare the classical and Keynesian aggregate supply
curves. What is the significance of the differences?
JUSTICE AND GLOBALIZATION
ECONOMICS SEMINAR
PROMPT 13
March 11
Assignment
Answer the following questions on Naiman, Chpt. 8, and bring a print
out of your
answers to class on
Thursday. They are to be handed in for some feedback.
1. Compare and contrast the pluralist and class views of the state.
2. Why does Naiman say that the ruling capitalist class
supports just the "democratic form" not democracy itself? What
benefit is there for the ruling class in supporting the "democratic
form"?
3. What are the functions of the state as seen by the class approach?
Discuss them briefly.
4. What are the various aspects of the accumulation function of the
state as seen by the class approach?
5. Discuss "the criminalization of dissent" as a recent aspect of the
coercion function of the state.
6. What does fascism tell us about the relationship between capitalism
and democracy?
JUSTICE AND GLOBALIZATION
ECONOMICS SEMINAR
PROMPT 14
March 13
Assignment
Based on the Keynes video we have seen in the class today, "John
Maynard Keynes:
What Did We Learn from the Great Depression?", discuss Keynes'
contribution in showing how an economy could be stabilized in the face
of unemployment. (200-300 words).
Post
your review on WebCT and bring a printout of it to class on Tuesday.
JUSTICE AND GLOBALIZATION
ECONOMICS SEMINAR
PROMPT 15
March 18
ESSAY ASSIGNMENT
Compare and contrast state policies in Canada, particularly
macroeconomic policies, under the welfare state (1946-71) and in
the era of globalization and neo-liberalism (1971 to date).
Describe the nature of each set of policies. How did each come about?
What are the impacts of each set of policies?
Length: 300-500 words
Use correct form and format giving
page references (e.g. p 113) where appropriate.
Due: Thursday, Mar. 20
Please post your essay to WebCT by
that date and bring a hard copy to class.
For Thursday also, please read
the
Canadian Labour Congress's Sweatshops:
What we know and what we can do about it. Choose two drawings from it that you
particularly like to point out to the class. Be able to explain to us
how the two drawings, and what they depict, fit into the overall
analysis of sweatshops and globalization presented in this publication.