The United States is one of the most economically powerful societies to have ever existed in the world. How did it get that way? Are there specific events that could have set it on a different path? What sets it apart – and what doesn’t set it apart – from other societies, both present and past?
This class will use the tools of economics to answer these questions. Economics, in short, is the discipline of thinking in terms of incentives to make sense of the world. In fact, as we will see, much of US history – from the very beginning, all the way up to the present, will only make sense if we know how to use economic tools.
The course is organized as a series of topics illustrating important economic concepts:
- American Ecology Before Humans. Many economic problems are common to all life, and not just to humans, let alone capitalist economies.
Scarcity, opportunity cost, Lotka’s law, arbitrage, niche construction
- Native American Societies. Varieties of solutions to the free-rider problem.
- The Shoshone: The small band, immediate return resources, gossip as accounting
- The Tlingit: Hierarchy, delayed return resources, the potlatch
- The Comanche: Barbarigenesis, costly signaling, intense ritual
- The Hupa: Back-loaded resources, money
- The Innu: Commons problems, property rights
- Slavery and the Economy. Why slavery hurt, and didn’t help, the Southern economy.
Capital, revealed preference, the Coase Theorem, the principal-agent problem, welfare analysis, counterfactual reasoning
- Can Individuals Make A Difference? When individual personalities matter, as opposed to deterministic historical forces.
Nash equilibrium, war finance, credible commitment, banking systems with and without central banks
- The Great Depression and the New Deal. Why the Great Depression happened, why it lasted so long, and how recovery happened.
Supply and demand, the quantity theory of money, unemployment, the gold standard, banking crises, balance sheets
