Today we talked about population theory. We saw that there are two theories: classical and modern. The classical theory claims that when people get richer they have more kids. In the modern theory, when people get richer they save the money to better their lives and the lives of the kids. The change from classical theory to modern theory was the change from a need for child quantity to a need for child quality.
The coordination trap says that poor families needed more kids under the classical theory because they needed more workers in the fields. There was no coordination or progress and industry never came. The rich on the other hand sent their kids to school because they had workers and industry.
There is a cycle of technology. As technology improved, so did productivity. Then there are higher wages and then people want to go to school to earn these higher wages. Because people go to school there is more technology. This cycle shows how we will never lose our jobs to robots.
The peer effect says when people move around, everyone improves. The Industrial Rev. happened because the tinkerers had time to tinker and they improved. The products were not what started the revolution.
Smith's "Wealth of Nations" talked about institutions - the most important determinant of economic growth. This said to respect the rule of law and to tolerance. With this entrepreneur created whatever they wanted. The change in climate led to the revolution as the bourgeoisie gained respect.
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