Practice questions for Exam 2

Economic History of the United States (ECON 3100)  w/Elaine Peterson

Use separate sheets as needed to answer each of the following:

1. Describe the radical change in growth for the South following the Civil War. How might this relate to institutional changes and changes in political power?

2. Explain Rostow’s take-off hypothesis and Fogel’s major criticisms.

3. How would Schumpeter describe US growth following the Civil War?

4. How would Brinley Thomas describe US growth following the Civil War? Does this conflict with John Thomaske’s work?

5. What’s the "Crime of ‘73"? Why was it "committed"? Who benefited and who lost from the policies associated with the "Crime of ‘73"? Can you suggest an alternative policy that might have addressed the grievances of the losers without recreating the reason the "crime" was "committed"?

6. What’s Engel’s law ? How does it relate to the changes in our economy, growth, comparative advantage, and the level of US international trade?

7. Contrast the Knights of Labor with the AFL.

8. How did the 16th amendment manage to pass ? Be sure to explain the structure of the income taxes implemented as well as the views of Baack and Ray.

9. WWI involved our first large scale use of a military draft. Discuss the equity and efficiency implications of using a draft versus a voluntary army. Be sure to make clear your assumptions about the labor supply.

10. In class we read about the money used on the island of Uap. How does this relate to the changes in the US money system from a bimetallic system, to a quasi-bimetallic system, to the gold standard, to fiat money?

11. Two presidents named Roosevelt helped promote the acceptance of unions. What did Theodore Roosevelt do in 1902 to promote unionism? More importantly what did Franklin Roosevelt do in the mid-1930s?

12. Why did some people expect a recession immediately after WWI and why didn’t it materialize?

13. What is meant by “redistributive justice”?  Do you think a case for redistributive justice could be made based on the practice of convict-leasing in the early 1900s?

14. In 1929 the US had an unemployment rate of approximately 3.2%, or 1.6 million people unemployed, yet Hughes and Cain suggest we were at full employment. What do they mean by "full employment"?

15. Some economic historians think the Federal Reserve did not do all it should have to prevent the depression. Discuss alternative views of what they did or could have done.

16. Friedman and Schwartz, Keynes, Hayek and Robins, Schumpeter, Hansen and Wilson, and Temin emphasize different forces in terms of the causes of the depression and it’s severity. Contrast the Keynesian view with two of the others that we have discussed.

17. A variety of economic reforms were undertaken as part of the New Deal. Describe 3 of them.

18. Most economists argue that we should not strive to balance the budget on an annual basis and prefer to look at the structural budget. Some point out Hoover’s tax folly to emphasize their point. Explain what they are talking about.

19. Compare and contrast stock market activity in October 1929, October 1987 and late summer 1998. What are some of the institutional differences that might influence the impact of market changes on the real economy?