ECON-220 HISTORY OF ECONOMIC THOUGHT

HISTORY OF ECONOMIC THOUGHT

DR. PETROS KOSMAS LECTURER C A S A C O L L E G E ACADEMIC YEAR 2010 - 2011 LECTURE 2 ECON-220

Early Pre-Classical Economic Thought: Ancient Times  Chanakya’s Arthashastra.  Hediod’s Works and Days (Poem).  Xenophon’s Oeconomicus.

 Plato’s Republic.  Aristotle’s Politics. ECON-220

Early Pre-Classical Economic Thought in the Middle Age: Thomas Aquinas (1225-1274)  He was an Italian theologian and writer on economic issues.  He dealt with the concept of a just price, which he considered

necessary for the reproduction of the social order.  A just price was supposed to be one just sufficient to cover the

costs of production, including the maintenance of a worker and his family.  He argued it was immoral for sellers to raise their products

simply because buyers were in pressing need for a product. ECON-220

Early Pre-Classical Economic Thought in the Middle Age: Thomas Aquinas (1225-1274)  Aquinas discusses a number of topics in the format of questions

and replies, substantial tracts dealing with Aristotle’s theory.  Two of his questions concern economic issues, mainly relate to

what a just price is, and to the fairness of a seller dispensing faulty goods.  He argued against any form of cheating and recommended

compensation always be paid in lieu of good service.  In his opinion human laws might not impose sanctions for unfair

dealing, divine law did, in his opinion. ECON-220

Thomas Aquinas: Human Nature and the Common Good and the Necessity of Government

 Tyranny should be avoided by the appropriate

selection of kings and construction of institutions.  A ruler must temper his bodily or sexual powers with

his or her rational faculties.  The good ruler rarely overpowers his subjects but

channels their activities for the common good. ECON-220

Thomas Aquinas: Tyranny and Tyrannicide  A tyrant seeks to impose his or her own private interests by

force as opposed the legitimate political leader who seeks peace, moral enhancement, and sufficient distribution of material goods.

 The tyrant is guilty of sedition from Aquinas’ perspective.  Resistance to the injustice of the tyrant must be proportional

to that injustice.

 Public authorities should remove a tyrant but appeal to divine

intervention could be an alternative if this option is not available. ECON-220

Early Pre-Classical Economic Thought in the Middle Age: Duns Scotus (1265-1308)  One of Aquinas’ main critics in his work Sententiae (1295).  He thought it possible to be more precise than Aquinas in calculating

a just price, emphasizing the costs of labour and expenses.  Because buyer and seller usually have different ideas of what price

comprises.  If people did not benefit from a transaction, in Scotus’ view, they

would not trade.  He defended merchants as performing a necessary and useful social

role, transporting goods and making them available to the public. ECON-220

Feudalism  Aim: How did feudalism restructure the society, government,

and economy of European countries?  Do Now: What is feudalism? What was life like for the

peasants? The socioeconomic system that preceded Capitalism in Western Europe.

Development of Feudalism  From 800-1000 Vikings invaded Western Europe constantly which meant they would loot, steal, and kill if necessary. ECON-220

CONSTRUCTING THE PYRAMID OF THE SOCIAL CLASSES IN THE PERIOD OF FEUDALISM

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CONSTRUCTING THE PYRAMID OF THE SOCIAL CLASSES IN THE PERIOD OF FEUDALISM

SERFS AND FREEMEN 90% of the population

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CONSTRUCTING THE PYRAMID OF THE SOCIAL CLASSES IN THE PERIOD OF FEUDALISM

LESSER NOBLES (KNIGHTS) LABOR

PROTECTION

SERFS AND FREEMEN 90% of the population

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CONSTRUCTING THE PYRAMID OF THE SOCIAL CLASSES IN THE PERIOD OF FEUDALISM

POWERFUL NOBLES OR LORDS LAND AND PROTECTION

LOYALTY AND MILITARY SERVICE

LESSER NOBLES (KNIGHTS) LABOR

PROTECTION

SERFS AND FREEMEN 90% of the population

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CONSTRUCTING THE PYRAMID OF THE SOCIAL CLASSES IN THE PERIOD OF FEUDALISM KING LOYALTY AND SERVICE

LAND

POWERFUL NOBLES LAND AND PROTECTION

LOYALTY AND MILITARY SERVICE

LESSER NOBLES (KNIGHTS) LABOR

PROTECTION

SERFS AND FREEMEN 90% of the population

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Feudalism: An exchange system  Political, social, and economic system that worked on the

basis of exchange between kings, nobles, knights, and peasants.  Kings gave land to nobles in exchange for money and nobles

allowed peasants to work this land in exchange for protection.  Kings give land, nobles give protection, peasants give labor.

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Feudal Exchanges  The Lord’s estate or the land he was given by the

King, was known as a Manor.  Peasants worked / farmed all day long from sun up

until sun down without breaks in order to pay taxes and survive.  Serfs were taxed for everything! Taxes were used to

protect the peasants… (Church Tax, Marriage Tax, Crops). ECON-220

Manorialism  Manors had churches, mills, farms, and homes for

the peasants who were bound to the manor.  The economic system or style of economy that

existed on the manors of Europe. It stressed selfsufficiency.  The serfs/peasants on a manor rely on one another.

The manor becomes self-sufficient: able to function without outsider help. ECON-220

Workers on the Manor  There were two groups of peasant workers on the

manor:

 Freemen- skilled workers who paid rent and could

leave the manor whenever they wished. (They usually had a skill needed by others on the manor.)

 Serfs – workers bound to the land by contract with

the nobles. (They had no freedom - they where the noble’s property.) ECON-220

What is a Knight?  Almost all nobles were knights.  Training began at age 7, as a page, under the guidance

of the lady of the manor.  Became squires at age 15 and were trained by other

knights.  Those deemed worthy were “dubbed” knights. ECON-220

Relationship Between Lords and Vassals  The relationship between lords and vassals made up

a big part of the political and social structure of the feudal system.   Vassals had certain duties to perform for the lord.

 All nobles were ultimately vassals of the king.

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Feudal Contract LORDS

GIVE SERVICE TO

GIVE PROTECTION TO

VASSALS ECON-220

The growth of feudalism in Europe during the Middle Ages was primarily caused by the 1. rivalry between the colonial empires. 2. suppression of internationalism. 3. decline of the Roman Catholic Church.

4. collapse of a strong central government.

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Knowledge Check…  Why did the Kings give land to the Nobles?  What did the Nobles do for the Peasants?

 How did the Peasants repay the Nobles?  How does Feudalism work?

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REVIEW 1)

Everyone owed loyalty to the ________

2)

_______ were really the most powerful. They got _______ from the king.

3)

Lesser nobles (knights) gave _________ _________ in return for land

4)

_______ were bound to the land. They worked in return for ____________.

5)

__________ were skilled workers. They paid rent to the ______ and were free to move if they wanted to. ECON-220

REVIEW 1)

Everyone owed loyalty to the king.

2)

Nobles were really the most powerful. They got land from the king.

3)

Lesser nobles (knights) gave military service in return for land.

4)

Serfs were bound to the land. They worked in return for protection.

5)

Freemen were skilled workers. They paid rent to the nobles and were free to move if they wanted to. ECON-220

Feudalism influenced Europe by:  providing social stability.  fostering the growth of religion.  eliminating warfare.  encouraging formal education

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The traditional villages of India

 peasants were seldom able to change their social status.  women dominated the political decisions of the local

councils.

 people could choose from a number of different

occupations.

 monarchs exerted absolute power over local governments.

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Feudalism in Japan  Japan’s social hierarchy was similar but they did not

have knights, they had Samurai.  The Way of the Warrior: Strict code of Samurai

conduct and loyalty until death.  Bushido  The Way of the Warrior: Strict code of

Samurai conduct and loyalty until death.

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Exit Slips  Why did people begin living on manors?

 Why did they accept feudalism?  How did feudalism change the political, social,

and economic way of life in Europe?

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