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https://oercommons.org/courseware/lesson/60725/overview
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oercommons
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2025-03-18T00:36:44.854599
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Sebastián Jiménez
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{
"license": "Creative Commons - Attribution - https://creativecommons.org/licenses/by/4.0/",
"url": "https://oercommons.org/courseware/lesson/60725/overview",
"title": "PLASTIC ARTS.",
"author": "leslie murcia"
}
|
https://oercommons.org/courseware/lesson/99317/overview
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Appearance and Reality
Overview
PowerPoint slides with a small biography of Russell Bertrand and some of his thoughts on apperance and reality. There are also some slides where I give my interpretations on some of Russell's thoughts.
Appearance and Reality - Russell Bertrand
Final Project for Intro to Philosophy
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oercommons
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2025-03-18T00:36:44.871393
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12/07/2022
|
{
"license": "Creative Commons - Attribution - https://creativecommons.org/licenses/by/4.0/",
"url": "https://oercommons.org/courseware/lesson/99317/overview",
"title": "Appearance and Reality",
"author": "Michael Rauschenbach"
}
|
https://oercommons.org/courseware/lesson/105266/overview
|
Learning to Garden -Teaching and Learning in Adulthood
Overview
This is my PLP assignment for college.
I wanted to focus on something that I wanted to learn, because I have a small farm. I thought incorporating the idea of learning to grow vegetables, or any plant for that matter indoors, and keep it indoors for the purpose of having food, would be a beneficial thing to learn.
Gardening for the first time - Insights
How Hard Can This Be?
My first attempt at gardening started off pretty easy. Because I live in Northern New England, growing plants indoors and transferring them outside can be tricky due to the risk of frost in the early summer, late spring, and having to protect the plants from insects, birds, rodents, and deer.
-I wanted to teach myself a way to grow plants year round and that was environmentally friendly, and used the least amount of resources like water.
-I purchased a garden kit where the plants grow indoors from a hybriponic indoor gardening system. This system recirculates water in a closed loop, which reduces water usage significantly. You can purchase the pods that are pre-seeded with the vegetables you want to grow, or you can buy pods where you can literally put any growable plant seed inside it.
-As a beginner at this process, I wanted to start small. So I picked two different types of lettuce. I picked Batavian Endive Lettuce and Arugula. I used 3 pods of each plant to learn this process.
-Why I chose lettuce and these two types were because lettuce is relatively easy to grow, it grows quickly, and they're my favorite combination for salads. Growing a small variety for this first experience would give me the opportunity to see how each of these plants grow, if they require a lot of time and care, and if they tasted delicious being grown indoors instead of outside.
Starting the plants
Let's Get This Plant Party Started
Starting the lettuce seeds, and waiting for them to sprout, didn't take very long. In fact, these plants grew rather quickly!
-Endive lettuce began to sprout within 7 days
-Arugula lettuce began to sprout 7 to 14 days. Some of the plants started quicker than others. I'm not sure why some of the arugula sprouted quicker than the arugula plants, but the plants matured within the same time.
Caring for the plants
Nurture those Greens
I found that growing the lettuce is relatively simple. But since the lettuce grows quickly, I found that I had to care for it daily.
-Endive lettuce needed to be pruned regularly to keep the roots and leaves healthy.
-Arugula lettuce was a little tricky during this learning experience. I had to regularly prune the leaves or harvest them, and I had to make sure that I kept the yellow-flowering stems from growing, as this changes the taste of the lettuce.
Harvesting the plants
Time To Bring In The Harvest
-Endive Lettuce: So during this learning experience, I found that I can start harvesting Endive lettuce within 3 weeks after starting the seedling. The best part of the lettuce to harvest are the tender center leaves as the heart of the plant.
What I found cutting the outer leaves, they are slightly more bitter than the center cut. For this learning process, I cut the majority of the lettuce down to the heart of the plant, to maximize the amount of lettuce to consume.
I then washed the harvested lettuce and dried them, placing them in a lettuce storage bag to keep in my refrigerator.
-Arugula: I treated the Arugula the same way I harvested the Endive lettuce. The growth time was about the same as the Endive lettuce.
Same thing, I washed the leaves, dried them, and then stored them in a lettuce storage bag to keep in my refrigerator.
-Taste:
I mixed both types of lettuce into one salad, and shared it with my husband. We had our own special vinagarette dressing and other toppings including candied pine nuts to go with the lettuce. One plant of the Endive lettuce and the other of Arugula was enough for my husband and I to have a full serving a vegetables. The taste was absolutely delicious!
Gardening Success and Failures
Successes:
-I was able to successfully grow the endive lettuce and arugula.
-Harvesting the leaves to make salads was the best part of this learning experience.
Failures:
-I over clipped the leaves on the endive lettuce, so after the first couple of cuts, the lettuce stopped producing leaves!
-The arugula, I couldn't keep up with keeping the outer stems trimmed, or delay the plant from bolting by keeping the yellow-flowering stems cut as they appeared.
Even though I was using an indoor gardening system, I found out that you can still kill your plants! I will be doing more research on the types plants I grow to ensure I am not overcutting or causing the plant's life to shorten!
Using Bloom's Taxonomy, I have created the following assessments on this learning process.
- Research and then describe the most important steps on harvesting lettuce throughout its productive lifespan to prevent the lettuce from stopping its production of leaves.
- Then demonstrate your understanding by applying the tips learned in the next set of lettuce plants being grown.
Outcomes and Assessment
My gardening experience is important to me as I have a small farm, and homesteading is my goal. I found that the following outcomes would be important before taking on planting lettuce outside, or growing an abundance of lettuce and other vegetables using the hybriponic gardening system within my home.
- Growing lettuce based on need - acquire all the knowledge on the different types of lettuce, how much each individual plant provides for two people, and how many plants should be grown at the same time to support two people.
- Try growing lettuce inside the home using an in-home garden system, to see if the process is easier than growing outdoors, and if the quality of the lettuce is comparable to what would be purchased at a food market or farmers market.
- Growing lettuce for taste- Explore the different types of lettuce, whether its done by purchasing lettuce at a local super market or farmer's market and finding which ones taste the best to grow at home.
- Evaluate how and when to harvest the lettuce to maximize the plant's life.
- Develop and implement a plan to maintain and harvest the lettuce so that the life of the plant can be maximized before having to regrow more plants.
- Share the knowledge with others to encourage them to grow their own food, even inside their homes to encourage better eating habits and to incorporate a healthy, more environmentally friendly lifestyle.
Assessment of the outcomes could include:
- List and explain the methods to grow lettuce, including indoor and outdoor.
- Incorporate recipes that can be used with the grown food.
- Build a timeline and a cost chart to determine if growing lettuce and other vegetables using an indoor gardening system for the life of the plant, or growing outside are more cost-effective.
- Develop a social media channel or wordpress site to share the knowledge to viewers. Create "tags" to draw interest.
Insights and Rationale for Gardening
Insights
Learning to garden has endless benefits. Besides learning to grow your own food, its beneficial for your health and for the environment.
Indoor gardening wouldn't be beneficial for the wildlife in your backyard, but it would be beneficial inside your home. Gardening relieves stress, and gives you the ability to learn and nurture something. But the most important thing is that you're growing your own produce to become more sustainable at home, and to reduce your environmental impact.
- Determine what works best for you and your living arrangements. Can your property accomodate outdoor gardening? Or would indoor gardening be better suited for your needs?
- Determine what you want to grow. For example, I learned that with the hybriponic indoor gardening system, I can grow my plants strictly inside my home, grow them year-round, and I can purchase pre-seeded pods of available vegetables to grow, use my own seeds and use them in unseeded pods, or start my seeds using the hybriponic indoor gardening system, and carefully transfer them into soil and place them outside to finish their growth.
-Understand that once the plants begin to grow, they need to be checked regularly.
-Do you plan to take this learned skill and use it for profit? Or would this be used for self-sustaining and as a hobby?
Learning to garden reminds me of Jack Mezirow and his learning theory of Transformative Learning.
Transformative learning theory touches on two basic kinds of learning: Instrumental and Communicative. Instrumental learning includes task-oriented problem-solving, and determination of cause-and-effect. Communicative learning emphasizes how learners communicate the needs, feelings, and desires.
By learning to grow food, adults can use what they have learned to fit their views and experiences of the world. They may want to learn this skill for their own health and survival, or they may see this as an opportunity to enhance their skills and turning the produce into profit, which can provide healthy opportunities within their community.
Rationale
In 2015, my husband and I bought a small hobby farm with 12.5 acres. We slowly incorporated chickens for access to fresh eggs, then we jumped in and bought beef cows, specifically Irish Dexters. We did a lot of research to determine which cows would be best suited for our type of land, and what would be the best size of cow since its only my husband and I. We didn't want to have more than we needed, as we felt this was waste. One of the challenges to having a farm, but also both of us having full-time jobs, is trying to have time to build a garden to grow our food.
I've never been successful with growing food outside, as they always fell victim to the New England weather, or the critters that raid the garden every night. I wanted to learn another way to grow a garden, and learning, using an indoor system, I thought would be beneficial to my needs. I'm hoping that I can grow on what I learned, and expand the methods where I had mentioned earlier, by starting the plants with the indoor system, and then transferring them outside.
Audience
Moving out of the city or urban areas seems to be a more common thing among adults. Adults seeking a lifestyle where they are less dependant on corporations to provide their food, seems to be increasing in demand as well. I think this type of change in lifestyle drives adults to want to learn something new that will be greatly beneficial to their health and well-being.
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oercommons
|
2025-03-18T00:36:44.895223
|
06/14/2023
|
{
"license": "Creative Commons - Attribution - https://creativecommons.org/licenses/by/4.0/",
"url": "https://oercommons.org/courseware/lesson/105266/overview",
"title": "Learning to Garden -Teaching and Learning in Adulthood",
"author": "Robin Gregg"
}
|
https://oercommons.org/courseware/lesson/122902/overview
|
Learning Object "Asking favors and making offers"
Overview
Learning Object "Asking favors and making offers"
Learning Object "Asking favors and making offers"
Learning Object "Asking favors and making offers"
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oercommons
|
2025-03-18T00:36:44.911740
|
12/11/2024
|
{
"license": "Creative Commons - Attribution - https://creativecommons.org/licenses/by/4.0/",
"url": "https://oercommons.org/courseware/lesson/122902/overview",
"title": "Learning Object \"Asking favors and making offers\"",
"author": "Lizeth Rojas"
}
|
https://oercommons.org/courseware/lesson/83562/overview
|
PreK - Grade 3 Reentry: Assessment
Overview
Resouces and guidance to help educators assess children in observational settings in order to find out where each child is on a developmental continuum.
Assessment Resources
Although children may have had inconsistent schooling experiences during the COVID-19 pandemic, screening children to place them in a grade level based on their scores is not an encouraged practice for this school year. As indicated in this bulletin, a child’s age should be the primary determinant for placement in the 2021–22 school year. However, we strongly encourage educators to intentionally assess children in observational settings in order to find out where each child is on a developmental continuum and design individualized instruction to meet each child where they are currently at. Below are helpful resources to support your assessment.
Resources for Educators in Assessing Children
Washington Digital Teach Kit | Washington Library Association
These easy-to-use guides have been crafted by teacher librarians to help K12 educators select and effectively implement commonly adopted digital learning tools in Washington State. Specifically designed for classroom educators, this resource bank provides links, support, and guidance for the effective use of over 20 digital learning tools already in use in many classrooms and schools across the state.
Learner Variability Navigator | Digital Promise
Free online tool from Digital Promise that translates the science of learner variability into easily accessible learner factor maps and strategies to improve educational product design and classroom practice. This model presents the science of learner variability in Math for grades PreK-2. It identifies the factors that are critical to learner success at this stage and the strategies to help you purposefully support each learner.
Child Outcome Summary (COS) Companion Tool
The COS is a requirement of special education programs but is a tool that can be used across settings to progress monitor and include multiple stakeholders in conversations about students growth and development. It includes sentence frames for meaningful conversations with families about children’s functional skills, age-anchoring concepts, and additional resources related to COS.
The Power of Documentation in the Early Childhood Classroom | NAEYC
An article for early childhood educators about what documentation is, what should be documented, why documentation is important, and the stages documenters go through as they learn.
GOLD®-Common Core State Standards Alignment | Teaching Strategies
This document aligns Teaching Strategies GOLD® objectives and indicators with the Common Core State Standards.
Understanding Observations, Reflections and Linking in Early Learning Settings | The Empowered Educator
A blog post about what observations are and why we need to do them when working as early childhood educators. Great resource for those who may be newer to conducting observational assessment.
WaKIDS Family Tools and Choice Boards | OSPI
These WaKIDS resources support kindergarten families and teachers with remote learning and engage students in learning activities that may inform the WaKIDS assessment. These include a Goal Planning and Reflection Sheet Choice Boards, and Discussion Prompts, Look Fors, and Observational Activities. The Goal Planning and Reflection Sheet is intended be co-created with the child, their parent/guardian and teacher during meeting times.
Funds of Knowledge | OSPI
The Funds of Knowledge Inventory Matrix can help teachers record their observations and potential classroom ideas. Information for this particular instrument can be accumulated over longer periods of time for specific students, or it can be filled out after completing a home/community visit so that the information is still fresh in the teacher's memory.
Authentic Child Assessment Practices Checklist | Early Childhood Technical Assistance Center
This checklist includes key characteristics of authentic assessment practices for observing child participation in everyday activities, the real world learning opportunities that occur in the activities, child behavior in the everyday learning opportunities, and the particular learning opportunities that provide a child the richest array of competency-enhancing learning opportunities.
Division of Early Childhood (DEC) Recommended Practices | Early Childhood Technical Assistance Center
The DEC Recommended Practices were developed to provide guidance to practitioners and families about the most effective ways to improve the learning outcomes and promote the development of young children, birth through five years of age, who have or are at-risk for developmental delays or disabilities. The purpose of this document is to help bridge the gap between research and practice by highlighting those practices that have been shown to result in better outcomes for young children with disabilities, their families, and the personnel who serve them.
Resources for Administrators in Assessing Programs
Local School District PreK Inclusion Self-Assessment | Early Childhood Technical Assistance Center
This self-assessment tool provides a framework for discussion to promote partnerships among schools and early care and education providers to promote the inclusion of young children with disabilities and their families in early childhood programs. We recommend forming a cross-sector team to complete the self-assessment. As the team considers each item, reflect on your experience working together to provide services to young children and families. Once the tool is completed, decide which item(s) will be a priority for future action to improve the quality of services.
Remember that all voices are important to moving a partnership forward. Early childhood programs are defined as Early Childhood Special Education, Early Intervention, Head Start, Early Childhood Education and Assistance Program, Early Head Start, Child Care, Title I Preschool, and other programs.
Indicators of High- Quality Inclusion | Early Childhood Technical Assistance Center
These four sets of indicators were designed by a group of national partners to support state leaders, local administrators and front-line personnel in the early care and education system providing programs and services to children, ages birth through five and their families.
Benchmarks of Quality-Classroom | Early Childhood Technical Assistance Center
The Benchmarks of Quality are checklists used by the leadership teams to assess where they are in the process of implementing evidence-based practices. This includes developing the necessary structures for guiding and supporting the implementation of evidence-based practices and planning the next steps in the process of full implementation, scale up, and sustainability. The benchmarks are designed to help teams move through the stages of implementation and build the systems and supports needed for high-fidelity use of the evidence-based practices. The Benchmarks of Quality are grounded in implementation science, an area of research focused on identifying critical factors and conditions needed to successfully adopt, integrate, and sustain evidence-based practices.
There are three Benchmarks of Quality used in this guide:
- State Leadership Team
- Classroom Based Programs
- Home Visiting Programs
Attribution and License
Attribution
Icons from the Noun Project: growth by Rockicon, Family by DewDrops, evaluative assessment by ahmad, resources by Becris, School by PJ Souders from the Noun Project
License
Except where otherwise noted, this curated resource collection by the Washington Office of Superintendent of Public Instruction and Washington Association of Educational Service Districts is licensed under a Creative Commons Attribution 4.0 International License. All logos and trademarks are property of their respective owners.
This document contains links to websites operated by third parties. These links are provided for your convenience only and do not constitute or imply any monitoring by OSPI or AESD. Please confirm the license status of any third-party resources and understand their terms of use before reusing them.
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oercommons
|
2025-03-18T00:36:44.948518
|
Washington OSPI OER Project
|
{
"license": "Creative Commons - Attribution - https://creativecommons.org/licenses/by/4.0/",
"url": "https://oercommons.org/courseware/lesson/83562/overview",
"title": "PreK - Grade 3 Reentry: Assessment",
"author": "Barbara Soots"
}
|
https://oercommons.org/courseware/lesson/117499/overview
|
BOC Sciences Chemistry Scholarship Program
Overview
Chemistry Scholarship opening for applications until Oct 31st, 2024.
BOC Sciences is excited to announce a Chemistry Scholarship Program, which grants $1,000 annually to college students studying in a chemistry-related field. The goal of this scholarship is to encourage and assist the future generation of chemists, enabling them to reach their highest potential and have a positive impact on the scientific world.
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oercommons
|
2025-03-18T00:36:44.965854
|
07/01/2024
|
{
"license": "Creative Commons - Attribution - https://creativecommons.org/licenses/by/4.0/",
"url": "https://oercommons.org/courseware/lesson/117499/overview",
"title": "BOC Sciences Chemistry Scholarship Program",
"author": "Becky Davis"
}
|
https://oercommons.org/courseware/lesson/66035/overview
|
GD
Overview
It is all about the process of GD in detail.
GD
It is about the process of GD in detail and explores the methods to participate GD in detail. It will be of highly useful to the learners who are about to be palced.
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oercommons
|
2025-03-18T00:36:44.981480
|
05/03/2020
|
{
"license": "Creative Commons - Attribution - https://creativecommons.org/licenses/by/4.0/",
"url": "https://oercommons.org/courseware/lesson/66035/overview",
"title": "GD",
"author": "Rajiv Junne"
}
|
https://oercommons.org/courseware/lesson/116083/overview
|
POTTERY CONTEST
SCULPTURE - PLASTIC ARTS LESSON
Overview
Objectives
- Recognizes general and specific information about sculpture and plastic arts in written reviews, spoken opinions, and in practicing with different items.
- According to these activities, the students are expected to learn the basic components of sculpture and its different structures to carry out the development of the course.
Lesson objectives (at the end of the class students will be able to):
- Identify different types of sculpture using and making writing, speaking, and listening activities.
- Identify key words in the videos that allow students to comprehend what is its general meaning and understand what topics sculpture implies, and the different types and methods of sculpture.
- Identify values from history and connecting students feelings with art which allow them to construct their interpretation of their identity in terms of specialization in art.
Skills Focus:
- Writing, Listening, and Speaking
Teachers:
- Luis Miguel Cabrera
- Jessica Perdomo
- Angie Natalia Franco Cruz
- Laura Sofia Muñoz
- Hamilton Cruz
Pre-activity 1
In this section, students are expected to play a Google game about pottery. In this game, they will need to sculpt and paint their historical pot. After they have done this, they will need to describe the pot they did and show to classmates the results. It would be like a sculpting competence. The best pot will get a reward. This activity was planned and made in order for students to know about different types of art, historical art; and how since the beginning people made art from anything. For this activity, students will count with 10 minutes.
While-activity 1
In the following video you will find the introduction about the sculptures, and the basic methods to make a sculpture. According to these videos, students must make a writing with 270 words highlighting important information and a personal aspect to highlight about the videos; answering different questions as what was their favorite type of sculpture and why, how they feel looking at any sculpture, what memory they have if they look at any sculture, or maybe what they would like to sculpt based on the recommendations of the video 'tutorial'. They are free to write whatever thoughts they have about the videos.
While-activity 2
This next activity is for students to spend some time playing with their classmates. To break the ice, but practicing one of the steps mentioned in one of the last videos; how drawings help students to prepare for sculpting. The next website is called 'PINTURILLO'; this game consists in guessing what is drawing students. So in this game, it would be necessary to create a 'private table', then all the students have to join that table and assign for each one a nickname. After this, there will be turns for drawing. A word is going to be given randomly to the person in charge of the draw. That person will count with an amount of time, so the draw needs to be done before the time ends. Also, classmates have to guess what is that person drawing. They need to guess before time ends too; just to get more points. With this, student will be studying different vocabulary on English. Besides, they will be practicing their art view.
Post-activity 1
For this part, students are going to choose a type of sculpting. Finally, They are going to plan any figure, amy form in order for them to try to sculpt it (it could be animals, human bodies, etc.) with different types of materials. This process would be taken as independent work and it would be individually. They have to record the whole process in a video to share it with the professor.
Assesmet section
After students have done the other activities, they would have to prepare a conclusion about the lesson, in which they summarize the topic of this class, and the relevant information. It needs to have at least 250 words in a three paragraphs.
|
oercommons
|
2025-03-18T00:36:45.007170
|
Interactive
|
{
"license": "Creative Commons - Attribution - https://creativecommons.org/licenses/by/4.0/",
"url": "https://oercommons.org/courseware/lesson/116083/overview",
"title": "SCULPTURE - PLASTIC ARTS LESSON",
"author": "Homework/Assignment"
}
|
https://oercommons.org/courseware/lesson/65920/overview
|
MANGO - Mangifera indica
Overview
Mango is a juicy fruit, grown in tropical climate. it is amember of drupe family. It has many functional properties
Functional Properties of Mango
MANGO
INTRODUCTION :Mangifera indica also known as mango ,it has been an important herb in the ayurvedic and indigenous medica systems for over 4000 years.According to ayurveda, varied medicinal properties are attributed to different parts of mango tree.Mango is one of the most popular of all tropical fruits.
Properties of Mango
The mango pulp contains 12amino acids,including all the irreplaceble ones.Mango is also rich in carotenoids.
The vitamins C and Ein the mango fruit in combination with Carotene and Fiber prevent cancer.
The vitamin B ,C and Carotene strengthen the immune system and protect cells from oxidation as antioxidants.
Phytotherapists prescribe a tea made of mango leaves for the treatment of diabetes and damaged eye .
NUTRITIVE VALUE
HEALTH BENIFITS:
Prevents cancer.
Lower cholesterol
Clears the skin
Improves eye health
Alkalizes the whole body
Improves digestion
Helps fight heat stroke
Boosts the immune system
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oercommons
|
2025-03-18T00:36:45.025206
|
05/02/2020
|
{
"license": "Creative Commons - Attribution - https://creativecommons.org/licenses/by/4.0/",
"url": "https://oercommons.org/courseware/lesson/65920/overview",
"title": "MANGO - Mangifera indica",
"author": "Subha Rajamanickam"
}
|
https://oercommons.org/courseware/lesson/60936/overview
|
Adolescent Development Lesson: Externalizing Behaviors
Overview
As a group, we were assigned the task to teach the rest of our class about some of the externalizing behaviors that adolescents experience. We put together this video in order to show how we went about accomplishing that task.
Externalizing Behaviors
This is a video presnetation of how we decided to teach externalizing behaviors of adolescents in our adolescent development class.
|
oercommons
|
2025-03-18T00:36:45.041036
|
12/19/2019
|
{
"license": "Creative Commons - Attribution - https://creativecommons.org/licenses/by/4.0/",
"url": "https://oercommons.org/courseware/lesson/60936/overview",
"title": "Adolescent Development Lesson: Externalizing Behaviors",
"author": "Conner Lewis"
}
|
https://oercommons.org/courseware/lesson/117219/overview
|
Dysfluency and Behavior
Overview
Given the behavioral needs of dysfluent adolescents, strategies should be implemented to strengthen the client’s confidence in communication. Therefore, this research will investigate the following research question: What strategies can be used if a client who is dysfluent is anxious?
CAT Paper
|
oercommons
|
2025-03-18T00:36:45.056747
|
06/24/2024
|
{
"license": "Creative Commons - Attribution - https://creativecommons.org/licenses/by/4.0/",
"url": "https://oercommons.org/courseware/lesson/117219/overview",
"title": "Dysfluency and Behavior",
"author": "McKendry Eschinger"
}
|
https://oercommons.org/courseware/lesson/10536/overview
|
Lab Workbook
Module 1
Overview
Please read chapter 1
Section 1
Please read chapter 1
|
oercommons
|
2025-03-18T00:36:45.072254
|
09/13/2016
|
{
"license": "Creative Commons - Attribution - https://creativecommons.org/licenses/by/4.0/",
"url": "https://oercommons.org/courseware/lesson/10536/overview",
"title": "Module 1",
"author": "Julie Hartwell"
}
|
https://oercommons.org/courseware/lesson/63275/overview
|
MANDELADAY2017outside
Original Article Image
LEARNING LESSONS FROM THE LIFE OF NELSON MANDELA ©Martine Bisagni
Overview
An article originally published in the Red Hook Star-Revue December 2013 (page 13) in response to the life of Nelson Mandela. Article is written ©Martine Bisagni/Workshop Gallery Artists Foundation.
Accompanying coloring cards geared for children 4 - 8 regarding the life and legacy of Nelson Mandela. Art courtesy of ©Sindiso Nyoni. Art may not be reproduced without express written permission from WGAF and Mr. Nyoni.
There are coloring cards for other years available upon request. They are to be distributed free of charge to all.
martine@workshopgalleryartists.org
Originally published in the Red Hook Star Revue December 2013, page 13 ©Martine Bisagni
"A fundamental concern for others in our individual and community lives would go a long way in making the world the better place we so passionately dream of."
Nelson Rolihlahla Mandela: 18 July 1918 - 5 December 2013
This week South Africa, indeed, all of us mark the life of Nelson Mandela with mourning, remembrance and celebration.
Last night at the Riverside Church Service of Praise & Thanksgiving in Harlem, the Reverend James Forbes set forth a challenge for the world to use this time as a period of collective self-reflection to ponder what we can do to bring about a better life for everyone.
'The great spirit wants to use Nelson Mandela's death to remind us that Nelson Mandela believed that all God's children should have a place at the table and that until that is happening God is not pleased, that all God's children must have healthcare. Why do some of you hoard your resources while others die for basic necessity? All God's children must have clothing and shelter and decent education and decent jobs. All of the nations of the earth need to hear this.'
Others who spoke echoed similar thoughts as they recalled Mandela'a actions through his life and the effects those actions have had on the world far beyond the fall of apartheid and the establishment of a new democratic South Africa through the labors of the Truth and Reconciliation Commission.
As many with more knowledge of history and politics than I will write about his life during these days, I write about the promise of his life that is now our responsibility to carry into our lives, especially as we utilize his example to teach our children how to live and create in the world.
In our arts organization we often open our doors for community art days for children and their families. For the past four years, it has become clear that while art is important, many of the basics that our children need are even more important. As we try to navigate what it means to be an arts organization in these days, we realize that it is imperative to address the whole child and the whole community and how we live and work together.
At the beginning of this year, the NYC Coalition Against Hunger released the figure that 1 in 4 children is NYC is food insecure -- meaning that there is insufficient food in their household on a regular basis. Some say it is not that high.
To focus on the preciseness of the number or on the definition of the term is to miss the point. One in six is too many. One in ten is too many. Children should not have to worry about enough food, nor should their parents. They cannot learn to become themselves if their bodies do not have proper nutrition, if their minds do not have education, if their creative impulses do not have outlet and if their spirits do not have development. It is an error in our society that so many of our families experience or worry about poverty. There is enough to share. One only need look at the wealth and plenty in our city to know there is enough to go around. There is enough worldwide. We must learn to share what we have.
'Like slavery and apartheid, poverty is not natural. It is man-made and it can be overcome and eradicated by the actions of human beings. Overcoming poverty is not a gesture of charity. It is an act of justice. It is the protection of a fundamental human right, the right to dignity and a decent life. While poverty persists, there is no true freedom. Of course the task will not be easy. But not to do this would be a crime against humanity, against which I ask all humanity now to rise up.'
As I read Mandela's words, I ask how can the world be shared so all lives can have fair opportunity? The answers I find are small and quieter than protests or legal battles. They take place in our homes, our hearts and our daily actions. Be generous to each other. Offer assistance where you can. Ask if you need. Do what you can so the lives of children are better.
It does take a neighborhood or village. Teach our children to love justice. Teach them to value fairness over privilege or the pursuit of privilege. Teach them to question their assumptions about what is acceptable and to develop their thoughts as knowledge changes. Let go of revenge. Cultivate forgiveness. Invite everyone to the table including those with whom you disagree. Especially those with whom you disagree, for the open table is the way to reconciliation and a working community. It is important that our children know each other and learn to work together. There is no better way to teach them these values than by our own example. We must work together as if their future depends upon it. It does. If there is anything to learn from Nelson Mandela's life, it is that living and working together is a real possibility.
As we think about how to work with everyone in our neighborhood, the artists find ways to take what we do into public spaces. Last year on July 18th two of our artists spent MADIBA DAY in Carroll Park making cards, teaching happy birthday in Xhosa, Zula and Afrikaans, adding the languages of our neighborhood children to the poster. It was a great start of what I hope will be a yearly event to bring the children of our city together celebrating Mandela's ideals, art, culture and getting to know each other.
That night one of the artists and I went over to celebrate Mandela's birthday at MADIBA Restaurant in Fort Green. South Africans of every age, hue and accent filled the place from one end to the other making music, singing, dancing and setting lanterns to the sky. The noise and merriment spilled into the streets. The police drove by waving and smiling at the somewhat loud, joyful crowd.
I found myself thinking back to the 1980s when it was hard to conceive that the dreadful government of instutionalized hell would ever break apart and a new South Africa would come together in unity. And yet here all around me ubuntu (humanness) was evident. Umuntu ngumntu ngabantu. (A person is a person because of other people.) The more we care for each other the more the world will be the one we dream of.
During open hours on Saturday and Sunday from 12 - 5 pm, our artists invite you to come make art to honor and celebrate the life of Mandela. Johannesburg-based Bulawayo/Zimbabwean artist Sindiso Nyoni has created a commemorative portrait for us to share and we have made a learning card for the children. Children and their families are welcome free of charge.
Martine Bisagni is director of Workshop Gallery Artists Foundation/Brooklyn Workshop Gallery, an non-profit foundation whose purpose is to promote and facilitate the process of keeping traditional art craft alive and vibrant in our world and to encourage the interpretation and expression of such through the individual artisan. They are located at 393 Hoyt Street. For more information, call (718)797-9428, or email martine.bisagni@gmail.com.
The beautiful art is courtesy of ©Sindiso Nyoni
|
oercommons
|
2025-03-18T00:36:45.095037
|
Journalism
|
{
"license": "Creative Commons - Attribution - https://creativecommons.org/licenses/by/4.0/",
"url": "https://oercommons.org/courseware/lesson/63275/overview",
"title": "LEARNING LESSONS FROM THE LIFE OF NELSON MANDELA ©Martine Bisagni",
"author": "Education"
}
|
https://oercommons.org/courseware/lesson/117275/overview
|
Critically Appraised Topic: Meeting the Needs of Augmentative and Alternative Communication Users
Overview
N/A
SLP 701: Research Methods in Speech-Language Pathology
N/A
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oercommons
|
2025-03-18T00:36:45.110704
|
06/25/2024
|
{
"license": "Creative Commons - Attribution - https://creativecommons.org/licenses/by/4.0/",
"url": "https://oercommons.org/courseware/lesson/117275/overview",
"title": "Critically Appraised Topic: Meeting the Needs of Augmentative and Alternative Communication Users",
"author": "Rylee Shearer"
}
|
https://oercommons.org/courseware/lesson/123024/overview
|
Vocabulary Control
Overview
Vocabulary control refers to managing language to ensure clarity, consistency, and accuracy. It resolves issues such as ambiguity, complexity, and inefficiency in communication. Major tools in vocabulary control are controlled vocabularies, thesauruses for specific topics, such as Classaurus, and NLP tools. These help ensure that words are used in the right sense and that they are applied consistently and accurately, especially for technical and specialized purposes. Another reason for vocabulary control is the difference between natural language, which is complex and variable, and artificial language, which is strictly controlled. Vocabulary control improves understanding and efficiency in a variety of domains.
1. What is Vocabulary Control?
Ans;- Vocabulary control in IR systems can be defined as the practice of managing and standardising the terms representing concepts, entities, and keywords to be used in a database or index. This further involves controlling vocabulary to raise search precision, recall, and overall system effectiveness.
In a controlled vocabulary a preferred term or phrase is assigned for use in surrogate records in a retrieval tool (e.g., bibliographic records in the library catalogue), the non-preferred terms have references from them to the chosen term or phrase, and relationships among used terms are established (e.g., broader terms, narrower terms, related terms). Scope notes may also be present.
A cataloger or indexer has to choose terms from a controlled vocabulary when they are assigning subject headings or descriptors in a bibliographic record to indicate the subject of the work, e.g. a book in a library catalogue, a bibliographic database, or an index.
Controlled vocabularies offer the means to structure knowledge so that it can be retrieved later. They are employed in subject indexing schemes, subject headings, thesauri, taxonomies, and other knowledge organization systems. Controlled vocabulary schemes require the use of predefined, authorized terms that have been preselected by the designers of the schemes as opposed to the natural language vocabularies that have no such constraint.
2. Why is it necessary to control vocabulary in IR?
ANS;- Needs for Vocabulary Control in IR systems include:
A. Improved Search Accuracy: Vocabulary control helps match user queries with relevant documents, thereby reducing errors because of synonyms, homographs, or terminological variations.
B. Increased Precision: Standardization of vocabulary allows IR systems to retrieve more relevant results with less noise and irrelevant information.
C. Improved Recall: Controlled vocabulary guarantees that all relevant documents are retrieved, reducing the number of missed documents.
D. Reduced Ambiguity: Disambiguation of words with multiple meanings improves search results.
E. Consistency: Controlled vocabulary ensures consistency in indexing, searching, and retrieval.
F. Efficient Indexing: Controlled vocabulary optimizes indexing, reduces storage requirements, and speeds up search processes.
G. User Convenience: Controlled vocabulary facilitates user-friendly search interfaces that accommodate different search terms.
H. Domain-Specific Knowledge: Vocabulary control includes domain-specific terms, thus retrieving the correct term.
I. Multilingual Support: Vocabulary control enables IR systems to support different languages.
J. Scalability: Vocabulary control enables IR systems to support large, diverse collections.
K. Improved Relevance Ranking: Vocabulary control enables algorithms to rank results better.
3. Vocabulary Control Tools
Ans;- In Library Science, vocabulary control tools ensure consistent and precise indexing, retrieval, and organization of library materials. Here are key vocabulary control tools:
Manual Tools
A. Thesauri:
- Library of Congress Subject Headings (LCSH)
- Medical Subject Headings (MeSH)
- UNESCO Thesaurus
B. Classification systems:
- Dewey Decimal Classification (DDC)
- Library of Congress Classification (LCC)
- Universal Decimal Classification (UDC)
C. Authority files:
- Library of Congress Name Authority File (LCNAF)
- Virtual International Authority File (VIAF)
D. Glossaries:
- Library and Information Science Abstracts (LISA)
- Glossary of Library and Information Science
Automated Tools
A. Indexing and abstracting tools:
- Online Public Access Catalogs (OPACs)
- Integrated Library Systems (ILS)
B. Taxonomy management software:
- Taxonomy Manager
- Ontology Editor
C. Vocabulary management systems:
- Vocabulary Manager
- Term Manager
D. Natural Language Processing (NLP) tools:
- Stanford CoreNLP
- OpenNLP
4. What is Classaurus?
Ans;- Classaurus was created by Ganesh Bhattacharyya for the POPSI indexing system.
Classaurus is a vocabulary control tool and classification scheme used for indexing in information retrieval systems.
Classaurus is a hierarchical scheme of terms controlling vocabulary, comprising of synonyms, quasi-synonyms, and antonyms. It is used to group disciplines, properties, entities, and actions in an hierarchy with unique codes.
There are two major constituents of Classaurus:
Alphabetical index: A list of all terms and codes
Systematic part: The terms are arranged hierarchically with unique codes
Classaurus encompasses all features of a thesaurus and its underlying principles are the General Theory of Subject Indexing Language.
5. What is the difference between natural language and artificial language?
Ans;- Natural Language (NL) and Artificial Language (AL) differ in their origin, structure, and usage:
Natural Language (NL)
1. Origin: Evolved naturally among humans.
2. Structure: Complex, flexible, and often ambiguous.
3. Vocabulary: Dynamic, with words and meanings changing over time.
4. Grammar: Context-dependent, with exceptions and nuances.
5. Usage: Spoken, written, or signed for human communication.
6. Examples: English, Spanish, Mandarin, Arabic, etc.
Artificial Language (AL)
1. Origin: Designed by man for a purpose.
2. Form: Formal, well-structured, and defined.
3. Vocabulary: Regulated with specific meanings.
4. Grammar: Based on rules with few ambiguities.
5. Use: To process data, program, represent data, or as a means of communication in a specific area.
6. Examples: Programming languages, markup languages, and formal languages.
1. purpose : NL for human communication , AL for specific tasks or computation.
2. Complexity: NL is more complex and rich, while AL is more structured and formal.
3. Flexibility: NL adapts to context, AL follows predefined rules.
4. Ambiguity: NL tolerates ambiguity, AL strives for precision.
5. Evolution: NL evolves naturally, AL is intentionally designed.
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oercommons
|
2025-03-18T00:36:45.129715
|
12/13/2024
|
{
"license": "Creative Commons - Attribution - https://creativecommons.org/licenses/by/4.0/",
"url": "https://oercommons.org/courseware/lesson/123024/overview",
"title": "Vocabulary Control",
"author": "Ajoy kumar Das"
}
|
https://oercommons.org/courseware/lesson/98434/overview
|
ELizabeth Barnes
THE METAPHYSICS OF GENDER
Overview
The purpose of this OER is to take a deeper dive into Chapter 12, What is Race? What is Gender?, from Nortons Introduction to Philosophy and The Metaphysics of Gender by Elizabeth Barnes. This OER contains my interpretation of the reading. There is a PowerPoint that breaks down the text and where I add my interpration into the reading. There are screenshots and certain parts highlighted to show important parts and further break down her comments, as well there are questions at the end to help involve the viewer. Gender is a topic that is prevelant in our everyday lives and it's important to look at why we all don't fit into this one word box that defines who we are as people.
Chapter 12: Elizabeth Barnes
The purpose of this OER is to take a deeper dive into Chapter 12, What is Race? What is Gender?, from Nortons Introduction to Philosophy and The Metaphysics of Gender by Elizabeth Barnes. This OER contains my interpretation of the reading. There is a PowerPoint that breaks down the text and where I add my interpration into the reading. There are screenshots and certain parts highlighted to show important parts and further break down her comments, as well there are questions at the end to help involve the viewer. Gender is a topic that is prevelant in our everyday lives and it's important to look at why we all don't fit into this one word box that defines who we are as people.
|
oercommons
|
2025-03-18T00:36:45.147333
|
11/02/2022
|
{
"license": "Creative Commons - Attribution - https://creativecommons.org/licenses/by/4.0/",
"url": "https://oercommons.org/courseware/lesson/98434/overview",
"title": "THE METAPHYSICS OF GENDER",
"author": "Brianna Adams"
}
|
https://oercommons.org/courseware/lesson/77859/overview
|
French Level 4, Activity 07: L'énergie nucléaire en France / Nuclear Energy in France (Online)
Overview
In this activity, students will learn more about nuclear energy use in France and practice sharing their opinions using the subjunctive tense.
Activity Information
Did you know that you can access the complete collection of Pathways Project French activities in our new Let’s Chat! French pressbook? View the book here: https://boisestate.pressbooks.pub/pathwaysfrench
Please Note: Many of our activities were created by upper-division students at Boise State University and serve as a foundation that our community of practice can build upon and refine. While they are polished, we welcome and encourage collaboration from language instructors to help modify grammar, syntax, and content where needed. Kindly contact pathwaysproject@boisestate.edu with any suggestions and we will update the content in a timely manner.
Nuclear Energy in France / L'énergie nucléaire en France
Description
In this activity, students will learn more about nuclear energy use in France and practice sharing their opinions using the subjunctive tense.
Semantic Topics
Nuclear energy, energy, environment, opinions, subjunctive, l'énergie nucléaire, l'environnement, subjonctif
Products
Nuclear energy
Practices
Using nuclear energy sources
Perspectives
In France, it is seen as a positive for the environment to use nuclear based energy. 70% of France's electricity is produced by nuclear generators!
World-Readiness Standards
- Standard 1.1: Students engage in conversations or correspondence in French to provide and obtain information, express feelings and emotions, and exchange opinions.
- Standard 1.2: Students understand and interpret spoken and written French on a variety of topics.
- Standard 2.2: Students demonstrate an understanding of the relationship between the products and perspectives of the cultures of the francophone world.
- Standard 3.1: Students reinforce and further their knowledge of other disciplines through French.
Idaho State Content Standards
- COMM 1: Interact with others in the target language and gain meaning from interactions in the target language.
- COMM 2: Discover meaning from what is heard, read or viewed on a variety of topics in the target language.
- CLTR 2: Investigate, explain and reflect on the relationship between the products and perspectives of the cultures studied in the target language.
- CLTR 2.1: Analyze the significance of a product (art, music, literature, etc...) in a target culture.
- CONN 1: Build, reinforce, and expand knowledge of other disciplines while using the target language to develop critical thinking/creative problem solving skills.
NCSSFL-ACTFL Can-Do Statements
- I can discuss renewable and non-renewable energy sources.
- I can share my opinion on nuclear energy.
- I can propose alternative renewable energy sources to replace nuclear energy.
Materials Needed
Warm-Up
Warm-Up
1. Begin the activity by opening the Google presentation and introducing the Can-Do statements.
2. Ask the students these questions:
- Connaissez-vous des sources d’énergies renouvelables ? Donnez-nous quelques exemples. (Do you know any renewable energy sources? Give some examples.)
- Connaissez-vous des sources d’énergies non-renouvelables ? Donnez-nous quelques exemples. (Do you know any non-renewable energy sources? Give some examples.)
Main Activity
Main Activity
Le débat
1. Split the students into teams and assign them a debate question. *If the class is small, you can have 1 student per team.
Aujourd'hui nous allons faire un débat. Je vais vous donner un(e) partenaire et une question. Pour chaque question, il y aura 2 équipes.
2. Here are the 3 questions:
- À votre avis, l'énergie nucléaire est-elle bonne ou mauvaise ? (In your opinion, is nuclear energy good or bad?)
- Equipe 1 - L'énergie nucléaire est bonne.
- Equipe 2 - L'énergie nucléaire est mauvaise.
- Quel type d'énergie renouvelable choisiriez-vous pour remplacer l'énergie nucléaire en France ? Pourquoi ? (What type of renewable energy would you choose to replace nuclear energy in France? Why?)
*Example for the 2 different teams:
- Equipe 1: énergie éolienne (Wind energy)
- Equipe 2: énergie solaire (Solar energy)
- D'après vous, les Etats-Unis devraient-ils augmenter leur production d'énergie nucléaire ? (In your opinion, should the US increase their production of nuclear energy?)
- Equipe 1 - Les Etats-Unis devraient augmenter leur production d'énergie nucléaire.
- Equipe 2 - Les Etats-Unis ne devraient pas augmenter leur production d'énergie nucléaire.
*NOTE: Remind the students to try and formulate their responses using the subjunctive.
Essayez d'utiliser le subjonctif en créant vos réponses !
3. Here is a document with prompting phrases that use the subjunctive: Prompting Phrases.
4. Send this document to the students using the chat.
5. Share Slide 7 with the students before starting the debates. On this slide is background information that they can use to create their arguments.
Voilà quelques informations de base que vous pouvez utiliser pour créer vos arguments.
- If necessary, students can use their phones to research information or make up their own statistics. (Si nécessaire, vous pouvez utiliser votre portable pour rechercher plus d'information.)
6. Give each student/team 4-5 mins to make their initial argument. Then switch to the other student/team.
Chaque équipe aura 4-5 minutes pour présenter leur premier argument.
7. Then give each side 2-3 minutes to form a rebuttal in response to the opposing teams argument.
Puis, vous aurez 2-3 minutes pour formuler votre réfutation (counter-argument).
- If the group has 2 or more students, you can send them to breakout rooms to discuss their rebuttal arguments.
8. Finally, have them present their rebuttal arguments in 4-5 mins.
Enfin, chaque équipe aura 4-5 minutes pour présenter votre réfutation.
9. Repeat steps 2-4 until all groups have gotten to debate.
Répétez ces étapes jusqu'à ce que toutes les équipes avaient eu l'opportunite de faire leurs débats.
*Encourage students who aren’t debating to actively listen until it is their turn.
Si vous ne débattez pas, écoutez activement jusqu'à votre tour.
Wrap-Up
Wrap-Up
Ask the following question(s) to finish the activity:
- Existe-t-il des exemples de sources d'énergie renouvelables dans votre état d'origine? (Are there examples of renewable energy sources in your home state?)
Cultural Resources
France's nuclear energy policy
France 24 discusses nuclear energy in France
How about the nuclear option? France goes all in on atomic energy
End of Activity
- Can-Do statement check-in… “Where are we?”
- Read can-do statements and have students evaluate their confidence.
- Encourage students to be honest in their self evaluation
- Pay attention, and try to use feedback for future activities!
NCSSFL-ACTFL Can-Do Statements
- I can discuss renewable and non-renewable energy sources.
- I can share my opinion on nuclear energy.
- I can propose alternative renewable energy sources to replace nuclear energy.
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oercommons
|
2025-03-18T00:36:45.188940
|
Camille Daw
|
{
"license": "Creative Commons - Attribution - https://creativecommons.org/licenses/by/4.0/",
"url": "https://oercommons.org/courseware/lesson/77859/overview",
"title": "French Level 4, Activity 07: L'énergie nucléaire en France / Nuclear Energy in France (Online)",
"author": "Mimi Fahnstrom"
}
|
https://oercommons.org/courseware/lesson/65822/overview
|
Worksheet. reported speech
Overview
worksheet to accompany the navigation support document on reported speech
grammar
Worksheet: REPORTED SPEECH
Quick tips: We can report the words of a speaker in two ways:
Direct Speech: where we quote the actual words of the speaker.
Indirect Speech/ reported speech: where we report what a speaker said without quoting their exact words.
- Rewrite the following into reported speech.
- Steve said, “Mom is writing a letter to her brother who broke his arm.”
- Steve said, "I am going to the library."
- Ben said, "I want to go for a movie tonight."
- Mary said, “We’re studying a lot of English online.”
- Mary asked, “What are you doing?”
- Steve said, “Do you suppose you know better than your manager?”
- Mary asked, “How many newspapers do you read every day?
- Steve asked, “How did you bake this cake?
- Mary asked, "When are you leaving?"
- Mary asked, "How much do you pay for your swimming classes?"
- Choosing reporting verbs from the table, rewrite the following into indirect speech.
add, advise, admit, agree, announce, answer, argue, ask, boast, beg, claim, comment, complain, confirm, consider, command, deny, doubt, decide, demand, discuss, estimate, explain, expect, explain, enquire fear, feel, guarantee, guess, hope, insist, mention, observe, offer, persuade, propose, promise, remark, remember, repeat, reply, report, reveal, recommend, request, realise, understand, warn, wonder |
- Mayank: “Why don't you join a dance class?”
- Arjun: “You need to work harder of you want an A grade.”
- Priya: “It’s very hot. I can't sleep.”
- Shashi: “The birds come because they’re attracted to yellow flowers.”
- Smitha: “Could you tell me where room no. 14 B is?”
- Tina: “I cannot take you with me.”
- Shiji: “Come as soon as you can.”
- Manju: “I'll call you every day.”
- Seril: “You can’t travel with me.”
- Mayank: “I won’t break it. I’ll be very careful.”
- Siddhu: “Is this your house?”
- Smita: “These are heavy. I’ll help you carry them.”
- Arjun: “Let me help you carry them up the steps.”
- Bindu: “There are mosquitoes because of stagnant water.”
- Manu: “Do visit the British Museum while you're in London.”
- Priya: “Wow! Manna is making a lot of money with her new bakery.”
- Tina: “It’s sad you have to leave early.”
- Bobby: “I’m definitely not going to borrow money from anyone.”
- Riya: “I feel terrible that I shouted at my mother.”
- Shiva: “It is back breaking work, but I need the money.”
- Rewrite the following conversations into reported speech.
Naveen: If I were you, I'd use a mask.
Ramesh: I beg your pardon?
Naveen: I said, if I were you, I'd use a mask before going to the supermarket.
Ramesh: Oh yes! But I don’t have one.
Preeti: Where’s your father?
Suma: He’s walking the dog.
Preeti: Oh! You have a dog? I love dogs.
Suma: We have a lab. He’s adorable, his name is Pretzel.
- Change the following into direct speech.
- She told me that she wanted to study in Hyderabad.
- He said the bank was closed.
- They said they were going to celebrate Shelly’s birthday.
- He said he didn't like Shah Rukh Khan.
- She told the stranger explained that
- She told me that she'd played for the Blues tennis club for six years.
- I asked Siddhu to pass me the curry.
- Rewrite the following into direct speech.
We were at Selvan’s housewarming party. His parents had recently moved to Chennai.
Selvan introduced me to his mother who said she was pleased to meet me. She said Selvan had spoken a lot about me.
Selvan:
Mother:
I replied that Selvan was a very dear friend and added that her new house was very beautiful.
Me:
She thanked me and said she hoped she would like the city. I said it was quite easy to make new friends in the neighborhood. The only problem was the humidity.
Mother:
Me:
She agreed. They had been staying at the Taj for three weeks before they moved into the new house. She could not step foot outside the hotel before 6 pm! I found it very funny and said she might get used to it. I also consoled her saying the rainy season was better.
Mother:
Me:
VI. Here's a story telling activity using Voicethread. Follow instructions and complete the task.
https://voicethread.com/share/14288617/
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oercommons
|
2025-03-18T00:36:45.241775
|
05/01/2020
|
{
"license": "Creative Commons - Attribution - https://creativecommons.org/licenses/by/4.0/",
"url": "https://oercommons.org/courseware/lesson/65822/overview",
"title": "Worksheet. reported speech",
"author": "Kshema Jose"
}
|
https://oercommons.org/courseware/lesson/117402/overview
|
The Effect of Routine Vocal Exercises on Individuals with Parkinson’s Disease
Overview
This systematic review looks at the following research question: Do routine vocal exercises to maintain voice effectively treat adults with Parkinson’s disease?
This systematic review examines the impact of vocal exercises as a treatment for individuals with Parkinson's disease.
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oercommons
|
2025-03-18T00:36:45.257868
|
06/27/2024
|
{
"license": "Creative Commons - Attribution - https://creativecommons.org/licenses/by/4.0/",
"url": "https://oercommons.org/courseware/lesson/117402/overview",
"title": "The Effect of Routine Vocal Exercises on Individuals with Parkinson’s Disease",
"author": "Isabella Onkst"
}
|
https://oercommons.org/courseware/lesson/63807/overview
|
The ACAT Method (Analogous Comparison and Transfer Method)
Overview
This is a short description of the ACAT Method.
The method uses analogous comparisons by taking examples or situations from everyday life and in consequence the logical or analogous transfer to the scientific problem. The method uses the development of imaginations or “pictures in the head” to develop a view of the analogy; this picture is transferred as a problem-solving idea to the concrete scientific problem. Multimedia material like animations are used to provide a higher level of imagination and to develop the understanding for the discussed problem.
What is the ACAT Method
The ACAT method is a completely new approach to teaching science. The method has been presented for the first time at the International Conference for Education, Research and Innovation ICERI2017 in Seville (Spain).
If you need further information you may reed the conference paper: https://library.iated.org/view/MAZOHL2017TEA
Teaching science Subjects to girls – the Analogous comparison and transfer Method (ACAT)
Peter Mazohl1, Harald Makl2
1University of Technology Vienna (Austria)
2Pädagogische Hochschule Baden (Austria)
peter.mazohl@advanced-training.at
Abstract
Boys and girls learn differently – this fact is proven in several studies (Sir Peter Knight, 2012). This is visible especially in STEM subjects (Science, Technology, Engineering and Mathematics), in which female learners are often less successfully in their learning compared with the male learners (Keller, 2013).
This paper describes a new pedagogical approach to strengthen female learners in STEM subjects. The method was developed in School Education and focuses on the age of 16 to 18 years old students. The method uses analogous comparisons by taking examples or situations from everyday life and in consequence the logical or analogous transfer to the scientific problem. The method uses the development of imaginations or “pictures in the head” to develop a view of the analogy; this picture is transferred as a problem-solving idea to the concrete scientific problem. Multimedia material like animations are used to provide a higher level of imagination and to develop the understanding for the discussed problem. The method was developed in the subjects physics, mathematics and computer science and was tested in physics at high school level.
The research questions focused on the proof of the acceptance of the method, the feedback of the concerned female learners; and finally, how male learners also can benefit of this pedagogical approach. The paper presents the result of a study with a sample of approx. 150 learners from different schools in Austria.
The study proofs the acceptance of the pedagogical approach and confirms the usability with an evident preference of female students. In general, the students appreciate the method with higher approval of the female learners. In the same way, the female learners show a stronger agreement to the use of multimedia material, specifically using the described method and to enable the transfer from everyday life images to scientific imagination and clear ideas dealing with the currently discussed problem.
As further steps, the development of a European project is proposed with a strict focus on teaching physic (or other subjects like biology or chemistry) using the method in several similar schools in European countries, using the identical material, this must be embedded in a well-developed evaluation environment interpreting and publishing the results including the comparison to this study.
|
oercommons
|
2025-03-18T00:36:45.274362
|
03/08/2020
|
{
"license": "Creative Commons - Attribution - https://creativecommons.org/licenses/by/4.0/",
"url": "https://oercommons.org/courseware/lesson/63807/overview",
"title": "The ACAT Method (Analogous Comparison and Transfer Method)",
"author": "Peter Mazohl"
}
|
https://oercommons.org/courseware/lesson/106221/overview
|
NWRESD Care and Use of Equipment agreement_2022-23_Home_community.docx
NWRESD Care and Use of Equipment agreement_2022-23_School District
NWRESD Care and Use of Equipment agreement_2022-23_School District.docx
Equipment Maintenance and Inspection
Overview
New hires need to know what to look for in terms of safety inspection when checking equipment out and encountering equipment in the field. They should be aware of the program’s policies and procedures regarding equipment inspection but may need to re-visit this information over time following the initial onboarding.
The following downloadable resources are provided to serve as examples of what a Care & Use agreement could look like.
Equipment Maintenance and Inspection
New hires need to know what to look for in terms of safety inspection when checking equipment out and encountering equipment in the field. They should be aware of the program’s policies and procedures regarding equipment inspection but may need to re-visit this information over time following the initial onboarding.
The following linked equipment folder provides examples of maintenance protocols.
The following downloadable resources are provided to serve as examples of what a Care & Use agreement could look like.
|
oercommons
|
2025-03-18T00:36:45.295017
|
07/03/2023
|
{
"license": "Creative Commons - Attribution - https://creativecommons.org/licenses/by/4.0/",
"url": "https://oercommons.org/courseware/lesson/106221/overview",
"title": "Equipment Maintenance and Inspection",
"author": "Nathaniel Baniqued"
}
|
https://oercommons.org/courseware/lesson/73097/overview
|
Summary and Conclusion_Goodnow
Brief Summary: Goodnow
Overview
This is a summary of the famous work by Frank Goodnow an important figure in the world of Public Administration. The concepts found in this work correlate to the organization and designation of powers within government. The defining aspects of public administration are discussed by the author in correlation to the scheme of political science.
Bureaucracy Introduction
Objectives:
1. Able to discuss the premise of the book
2. Identify key themes
3. Connections made in the realm of political science and public administration
4. What your opinion is?
Summary and Conclusion
The conclusion to the Summary follows:
|
oercommons
|
2025-03-18T00:36:45.312945
|
10/02/2020
|
{
"license": "Creative Commons - Attribution - https://creativecommons.org/licenses/by/4.0/",
"url": "https://oercommons.org/courseware/lesson/73097/overview",
"title": "Brief Summary: Goodnow",
"author": "Lilia Iokhvidov"
}
|
https://oercommons.org/courseware/lesson/97649/overview
|
Searching and finding Open Educational Resources (OER)
Overview
This resource is about finding and recognizing OER.
How to search for Open Educational Resources (OER)?
Which material to use for my OER?
How to attribute open material using the TASLL rule?
Except where otherwise noted, this work is licensed under CC BY 4.0 (https://creativecommons.org/licenses/by/4.0/) by ZHAW, University Library (17 October 2022).
How to search for Open Educational Resources (OER)?
There are different ways to search for different formats and resource-types.
There is a comprehensive link list on Creative Commons, which is regularly update.
OER-specific search platforms:
- Wikimedia Commons
- openverse (extensive library of images and audio)
- OER Commons - you can search directly for subject-specific content or use sites within OER Commons that has it all aggregated, like the Open Textbook Hub
Openly licensed material under own licence:
Some platforms like Pixabay, Unsplash and thenounproject use their own licence. If you use their resources, you need to link to their licence. Always read the licence before using the content, in order to know what is allowed and what is not:
- Pixabay - has its own licence - images, videos and music and sound effects
- thenounproject and its licence - search for icons and photos, 3 different licences: Public domain, Attribution Licence CC BY 3.0 and royalty-free Licence, always read the licence.
Search engines - you need to use filters to find OER material
- Google - search for OER in the search field, e.g. "psychology OER" or adjust the usage rights filter in advanced search settings to "free to use or share, even commercially"
- Flickr - refine your search by setting "any licence" filter to Creative Commons
OER subject resources - you can find them through google by searching for open textbooks
- Open Textbook Library on a variety of subjects
- Open Library
- Cal Poly Humboldt - OER subject resources
- bc campus open textbooks
- University of Adelaide - OER subject resources
- Virtual linguistics Campus - OER platform for linguistics
- Open Textbook Hub on OER Commons
OER guides
- University of Adelaide - OER Guide
OER portals like Zenodo, PLOS
- Zenodo, examples of OER material: see our Students4OER-area for different resources that have been released under an open licence
- PLOS - open access, you can go through a suite of open access journals on PLOS
TASK 1:
- Try out a few of the search sites listed above
- Search for a resource from your subject field
- Read Step 3
- Go to Step 4 and follow instructions
Which material to use for my OER?
Material for OER - in order to publish your OER under an open licence, you need either to be the rights holder, that is you have the usage rights, or the material you use needs to be under an open licence. If you use copyrighted material, it is very rare that you can obtain the right to use and the right to publish it under an open licence, therefore:
Use your own material – where you have all the rights to use and publish the material
Use material under an open licence – the licence gives you the right and information, so you know what you can do with this work!
Plan using openly licensed material right from the beginning of developing your OER.
- Always check the licence. Is it published under an open licence, e.g. Creative Commons. The licence tells you what you can do with the resource.
How to attribute open material: TASLL rule
If you use other people's material, it needs to be under an open licence, so you know what you can do with the work.
If you can use it, in accordance with the licence of the work, attribute it, using the TASLL rule:
Image used: "Physio" by Olli Homann is licensed under CC BY-NC 2.0, text added by ZHAW University Library
A good platform is openverse, it generates the attribution automatically, but you still need to go to the original location of the resource and see if it is correct:
TASK 2:
- Go to the following image on openverse
- Now look at the attribution that is generated automatically by openverse: "Physio School #06" by Broken Window Theory is licensed under CC BY-NC-SA 2.0.
- Go to the image on Flickr and see if the licence autogenerated by openverse is correct:
- Is the licence correct?
- What can you do with it?
- Can you use the attribution from openverse as it is?
|
oercommons
|
2025-03-18T00:36:45.334829
|
10/03/2022
|
{
"license": "Creative Commons - Attribution - https://creativecommons.org/licenses/by/4.0/",
"url": "https://oercommons.org/courseware/lesson/97649/overview",
"title": "Searching and finding Open Educational Resources (OER)",
"author": "Yvonne Klein"
}
|
https://oercommons.org/courseware/lesson/77597/overview
|
French Level 2, Activity 02: Le temps libre / Free Time (Online)
Overview
Students work together to discuss their travel preferences. This includes a travel quiz to take together, and discussion questions. Students will learn how to discuss travel and explain their preferences. Students will also be able to discuss what type of traveler they are and why they are that type of traveler.
Activity Information
Did you know that you can access the complete collection of Pathways Project French activities in our new Let’s Chat! French pressbook? View the book here: https://boisestate.pressbooks.pub/pathwaysfrench
Please Note: Many of our activities were created by upper-division students at Boise State University and serve as a foundation that our community of practice can build upon and refine. While they are polished, we welcome and encourage collaboration from language instructors to help modify grammar, syntax, and content where needed. Kindly contact pathwaysproject@boisestate.edu with any suggestions and we will update the content in a timely manner.
Free Time / Le temps libre
Description
Students work together to discuss their travel preferences. This includes a travel quiz to take together, and discussion questions. Students will learn how to discuss travel and explain their preferences. Students will also be able to discuss what type of traveler they are and why they are that type of traveler.
Semantic Topics
heads-up, travel, quiz, traveler, whiteboard, pastime, hobby, les voyages, voyageur, voyageuse, la structure des questions et réponses, the structure of questions and responses
Products
Free time, vacation, and hobbies.
Practices
Traditions related to holiday celebrations, shopping behaviors, travel destinations, means of traveling, playing behaviors, meal times, turning taking in conversations or games.
Perspectives
Values attached to bilingualism/ multilingualism/ monolingualism, values associated with personal privacy, cultural value associated with sport and entertainment, belief about different cultures, the importance of individual vs group freedom.
NCSSFL-ACTFL World-Readiness Standards
- Standard 1.1: Students engage in conversations or correspondence in French to provide and obtain information, express feelings and emotions, and exchange opinions.
- Standard 1.2: Students understand and interpret spoken and written French on a variety of topics.
- Standard 2.1: Students demonstrate an understanding of the relationship between the practices and perspectives of the cultures of the francophone world.
Idaho State Content Standards
- COMM 1.1: Interact and negotiate meaning (spoken, signed, written conversation) to share information, reactions, feelings, and opinions.
- COMM 2.1: Understand, interpret, and analyze what is heard, read, or viewed on a variety of topics.
- CLTR 1.1: Analyze the cultural practices/patterns of behavior accepted as the societal norm in the target culture.
- CLTR 1.2: Explain the relationship between cultural practices/behaviors and the perspectives that represent the target culture’s view of the world.
NCSSFL-ACTFL Can-Do Statements
- I can talk about my interests and hobbies.
- I can understand written instructions about familiar topics.
- I can talk about activities I did in the recent past.
Materials Needed
Warm-Up
Warm-Up
1. Begin by introducing the Can-Dos for today's activity.
2. Use the following questions to have discussion with the students. They can also make their own questions as well. Be sure to model an answer for the first few questions.
Utilisez les questions ci-dessous afin d’avoir une conversation avec les étudiants. Ils peuvent également poser leur propre questions. Assurez-vous d’avoir des exemples de réponses pour les premières questions.
- Quel est ton passe-temps favori ? (What is your favorite past-time?)
- Qu’est-ce que tu fais dans ton temps libre ? (What do you do in your free time?)
- Quel est ton café préféré à Boise ? (What is your favorite coffee shop in Boise?)
- Est-ce qu’il y a un autre café que tu préfères ? Dans une autre ville ? (Do you have another favorite coffee shop? In another city?)
- Tu préfères aller au musée ou nager dans l’océan quand tu pars en vacances ? (Do you prefer going to the museum or swimming in the ocean when you go on vacation?)
- Tu aimes les jeux vidéos ? Quel est ton jeu vidéo préféré ? (Do you like video games? What is your favorite video game?)
- Où veux-tu aller cet été ? (Where do you want to go this summer?)
- Tu préfères voyager avec tes amis ou ta famille ? (Do you prefer to travel with your friends or your family?)
Main Activity
Main Activity
1. Tell the students that they are going to be taking a quiz to determine what kind of traveler they are.
Maintenant, vous allez faire un petit devoir pour déterminer "quel type de voyageur ou voyageuse que vous êtes".
2. Go through each question on the Google Slide Presentation and tell the students to record the answers of a partner on a piece of paper
Je vais vous montrer les questions. Vous devrez noter votre réponse sur un feuille de papier.
3. After the quiz, have the students share their answers to the questions with a partner.
Ensuite, partagez vos réponses avec un(e) partenaire.
4. Then, quickly go through the following sides explaining the different “types of travelers” depending on the answers the students had.
Maintenant, je vais montrer “le type de voyageur ou voyageuse que vous êtes...”
Wrap-Up
Wrap-Up
Cultural Resources
End of Activity
- Can-Do statement check-in... “Where are we?”
- Read can-do statements and have students evaluate their confidence.
- Encourage students to be honest in their self-evaluation
- Pay attention, and try to use feedback for future activities!
NCSSFL-ACTFL Can-Do Statements
- I can talk about my interests and hobbies.
- I can understand written instructions about familiar topics.
- I can talk about activities I did in the recent past.
|
oercommons
|
2025-03-18T00:36:45.409689
|
Camille Daw
|
{
"license": "Creative Commons - Attribution - https://creativecommons.org/licenses/by/4.0/",
"url": "https://oercommons.org/courseware/lesson/77597/overview",
"title": "French Level 2, Activity 02: Le temps libre / Free Time (Online)",
"author": "Mimi Fahnstrom"
}
|
https://oercommons.org/courseware/lesson/96088/overview
|
German Level 2, Activity 09: Rückblick vor den Frühlingsferien / Review Before the Spring Break (Online)
Overview
In this activity, students will review vocabulary from the previous chapters.
Activity Information
Did you know that you can access the complete collection of Pathways Project German activities in our new Let’s Chat! German pressbook? View the book here: https://boisestate.pressbooks.pub/pathwaysgerman
Please Note: Many of our activities were created by upper-division students at Boise State University and serve as a foundation that our community of practice can build upon and refine. While they are polished, we welcome and encourage collaboration from language instructors to help modify grammar, syntax, and content where needed. Kindly contact pathwaysproject@boisestate.edu with any suggestions and we will update the content in a timely manner.
Review Before the Spring Break / Rückblick vor den Frühlingsferien
|
oercommons
|
2025-03-18T00:36:45.435503
|
Mimi Fahnstrom
|
{
"license": "Creative Commons - Attribution - https://creativecommons.org/licenses/by/4.0/",
"url": "https://oercommons.org/courseware/lesson/96088/overview",
"title": "German Level 2, Activity 09: Rückblick vor den Frühlingsferien / Review Before the Spring Break (Online)",
"author": "Amber Hoye"
}
|
https://oercommons.org/courseware/lesson/97552/overview
|
AHP 100 Course Syllabus: Open for Antiracism (OFAR)
Overview
Course Syllabus for Medical Terminology Course
AHP 100 Course Syllabus
Carmen Bravo Instructor
|
oercommons
|
2025-03-18T00:36:45.452339
|
09/27/2022
|
{
"license": "Creative Commons - Attribution - https://creativecommons.org/licenses/by/4.0/",
"url": "https://oercommons.org/courseware/lesson/97552/overview",
"title": "AHP 100 Course Syllabus: Open for Antiracism (OFAR)",
"author": "Open for Antiracism Program (OFAR)"
}
|
https://oercommons.org/courseware/lesson/104806/overview
|
UVA, IHE Accessibility in OER Implementation Guide
Overview
Preliminary goals to improve accessibility in OER at the University of Virginia, developed by a team of faculty and support staff during the IHE Accessibility in OER Academy.
May 11 - Section One: Landscape Analysis for Accessibility in OER in Local Context (Work on during May 11th implementation)
Part One: Initial Thoughts and Initial Goals
- navigating options – this feels more complicated than a 1-person job
- How to take all this work and manage it, make actionable
- How to approach OER and accessibility knowing it’s not going to be ‘done’ at any time
- Understanding the needs of our faculty
- Going practical and concrete: captions, other concrete and doable steps
- Would be nice to have some easy references like “I’m using an Instagram post, how do I make this accessible?”
- Compiling and signposting the resources we have, and connecting them to a person who could provide additional support – getting this info out to all
- Taking a broad approach – considering UDL applications to a unit/book, not trying to make every piece of content “UDL-perfect”
- What small steps could we each be doing in our own particular projects, in the next 6mo for ex?
- Accessibility and images, or video
- Applying a particular principle across a wider curriculum
Part Five: Faculty learning and engagement
- Drop-in time, similar to open hours, to answer (and/or collect?) questions, to offer work time and support & guidance
- In person, face to face accountability, real time
- Accessibility meter in Canvas (Ally) raising awareness, culture shifts
Part Six: Final Probing questions
What is our current goal for Accessibility in OER and why is that our goal?
Who have we not yet included while thinking about this work?
- SDAC, students, other fields, other accessibility colleagues on grounds, administrators
What barriers remain when considering this work?
Time, labor, materials that require more work to make accessible
What would genuine change look like for our organization for this work?
Student accessibility board, faculty support around accessibility and student experience of accessibility; students as end users
Sharing data and experience
Section Two: Team Focus (Finish before May 25th to share during Implementation Session Two)
Identifying and Describing a Problem of Practice
- Implementation Goal:
- How can we bring awareness of accessibility to our colleagues? --> offer opportunities to experience inaccessibility
- Checklist/steps
- Sharing of SLIDE with other OER users/creators/adopters
- In our OER projects: descriptive links
- Evaluation of accessibility using tools like Andi
- Contributing an accessible remix of an existing OER
- Possible timeline: Fall 2023
- Possible support groups: LDT, Library, Academic Accessibility Coordinator, SDAC
- Voices that are not yet included: students, administrators, other colleagues
- Feedback Question: What has worked well for you in getting this out to a wider audience?
Section Three: Team Work Time and Next Steps (Complete by the end of Implementation Session Three)
Sharing and Next Steps
What was your redefined goal for this series?
What does your team want to celebrate?
Tools and new information!
Celebrate the group itself—discussion and upcoming changes with hope for “rippling effect.”
Hearing from faculty to better understand challenges related to creating/retroactively addressing accessibility in materials design.
Information was presented in an accessible way. Ability to approach changes one thing at a time.
The time was well-spent and the series well-structured.
What did your team accomplish? If you have links to resources, please include them here.
Realization of UDL as a pathway to learning for everyone.
Creation of a supportive community of faculty and IDs interested and invested in accessible content & learning environments.
What are your team’s next steps?
Continue these conversations.
Set aside work time/time to share progress.
|
oercommons
|
2025-03-18T00:36:45.486263
|
06/07/2023
|
{
"license": "Creative Commons - Attribution - https://creativecommons.org/licenses/by/4.0/",
"url": "https://oercommons.org/courseware/lesson/104806/overview",
"title": "UVA, IHE Accessibility in OER Implementation Guide",
"author": "Emily Scida"
}
|
https://oercommons.org/courseware/lesson/28802/overview
|
Introduction to Economic Growth
Calories and Economic Growth
On average, humans need about 2,500 calories a day to survive, depending on height, weight, and gender. The economist Brad DeLong estimates that the average worker in the early 1600s earned wages that could afford him 2,500 food calories. This worker lived in Western Europe. Two hundred years later, that same worker could afford 3,000 food calories. However, between 1800 and 1875, just a time span of just 75 years, economic growth was so rapid that western European workers could purchase 5,000 food calories a day. By 2012, a low skilled worker in an affluent Western European/North American country could afford to purchase 2.4 million food calories per day.
What caused such a rapid rise in living standards between 1800 and 1875 and thereafter? Why is it that many countries, especially those in Western Europe, North America, and parts of East Asia, can feed their populations more than adequately, while others cannot? We will look at these and other questions as we examine long-run economic growth.
Introduction to Economic Growth
In this chapter, you will learn about:
- The Relatively Recent Arrival of Economic Growth
- Labor Productivity and Economic Growth
- Components of Economic Growth
- Economic Convergence
Every country worries about economic growth. In the United States and other high-income countries, the question is whether economic growth continues to provide the same remarkable gains in our standard of living as it did during the twentieth century. Meanwhile, can middle-income countries like Brazil, Egypt, or Poland catch up to the higher-income countries, or must they remain in the second tier of per capita income? Of the world’s population of roughly 7.5 billion people, about 1.1 billion are scraping by on incomes that average less than $2 per day, not that different from the standard of living 2,000 years ago. Can the world’s poor be lifted from their fearful poverty? As the 1995 Nobel laureate in economics, Robert E. Lucas Jr., once noted: “The consequences for human welfare involved in questions like these are simply staggering: Once one starts to think about them, it is hard to think about anything else.”
Dramatic improvements in a nation’s standard of living are possible. After the Korean War in the late 1950s, the Republic of Korea, often called South Korea, was one of the poorest economies in the world. Most South Koreans worked in peasant agriculture. According to the British economist Angus Maddison, who devoted life’s work to measuring GDP and population in the world economy, GDP per capita in 1990 international dollars was $854 per year. From the 1960s to the early twenty-first century, a time period well within the lifetime and memory of many adults, the South Korean economy grew rapidly. Over these four decades, GDP per capita increased by more than 6% per year. According to the World Bank, GDP for South Korea now exceeds $30,000 in nominal terms, placing it firmly among high-income countries like Italy, New Zealand, and Israel. Measured by total GDP in 2015, South Korea is the eleventh-largest economy in the world. For a nation of 50 million people, this transformation is extraordinary.
South Korea is a standout example, but it is not the only case of rapid and sustained economic growth. Other East Asian nations, like Thailand and Indonesia, have seen very rapid growth as well. China has grown enormously since it enacted market-oriented economic reforms around 1980. GDP per capita in high-income economies like the United States also has grown dramatically albeit over a longer time frame. Since the Civil War, the U.S. economy has transformed from a primarily rural and agricultural economy to an economy based on services, manufacturing, and technology.
|
oercommons
|
2025-03-18T00:36:45.502040
| null |
{
"license": "Creative Commons - Attribution - https://creativecommons.org/licenses/by/4.0/",
"url": "https://oercommons.org/courseware/lesson/28802/overview",
"title": "Principles of Macroeconomics 2e, Economic Growth",
"author": null
}
|
https://oercommons.org/courseware/lesson/28803/overview
|
The Relatively Recent Arrival of Economic Growth
Overview
By the end of this section, you will be able to:
- Explain the conditions that have allowed for modern economic growth in the last two centuries
- Analyze the influence of public policies on an economy's long-run economic growth
Let’s begin with a brief overview of spectacular economic growth patterns around the world in the last two centuries. We commonly refer to this as the period of modern economic growth. (Later in the chapter we will discuss lower economic growth rates and some key ingredients for economic progress.) Rapid and sustained economic growth is a relatively recent experience for the human race. Before the last two centuries, although rulers, nobles, and conquerors could afford some extravagances and although economies rose above the subsistence level, the average person’s standard of living had not changed much for centuries.
Progressive, powerful economic and institutional changes started to have a significant effect in the late eighteenth and early nineteenth centuries. According to the Dutch economic historian Jan Luiten van Zanden, slavery-based societies, favorable demographics, global trading routes, and standardized trading institutions that spread with different empires set the stage for the Industrial Revolution to succeed. The Industrial Revolution refers to the widespread use of power-driven machinery and the economic and social changes that resulted in the first half of the 1800s. Ingenious machines—the steam engine, the power loom, and the steam locomotive—performed tasks that otherwise would have taken vast numbers of workers to do. The Industrial Revolution began in Great Britain, and soon spread to the United States, Germany, and other countries.
The jobs for ordinary people working with these machines were often dirty and dangerous by modern standards, but the alternative jobs of that time in peasant agriculture and small-village industry were often dirty and dangerous, too. The new jobs of the Industrial Revolution typically offered higher pay and a chance for social mobility. A self-reinforcing cycle began: New inventions and investments generated profits, the profits provided funds for more new investment and inventions, and the investments and inventions provided opportunities for further profits. Slowly, a group of national economies in Europe and North America emerged from centuries of sluggishness into a period of rapid modern growth. During the last two centuries, the average GDP growth rate per capita in the leading industrialized countries has been about 2% per year. What were times like before then? Read the following Clear It Up feature for the answer.
What were economic conditions like before 1870?
Angus Maddison, a quantitative economic historian, led the most systematic inquiry into national incomes before 1870. Economists recently have refined and used his methods to compile GDP per capita estimates from year 1 C.E. to 1348. Table is an important counterpoint to most of the narrative in this chapter. It shows that nations can decline as well as rise. A wide array of forces, such as epidemics, natural and weather-related disasters, the inability to govern large empires, and the remarkably slow pace of technological and institutional progress explain declines in income. Institutions are the traditions and laws by which people in a community agree to behave and govern themselves. Such institutions include marriage, religion, education, and laws of governance. Institutional progress is the development and codification of these institutions to reinforce social order, and thus, economic growth.
One example of such an institution is the Magna Carta (Great Charter), which the English nobles forced King John to sign in 1215. The Magna Carta codified the principles of due process, whereby a free man could not be penalized unless his peers had made a lawful judgment against him. The United States in its own constitution later adopted this concept. This social order may have contributed to England’s GDP per capita in 1348, which was second to that of northern Italy.
In studying economic growth, a country’s institutional framework plays a critical role. Table also shows relative global equality for almost 1,300 years. After this, we begin to see significant divergence in income (not in the table).
| Year | Northern Italy | Spain | England | Holland | Byzantium | Iraq | Egypt | Japan |
|---|---|---|---|---|---|---|---|---|
| 1 | $800 | $600 | $600 | $600 | $700 | $700 | $700 | - |
| 730 | - | - | - | - | - | $920 | $730 | $402 |
| 1000 | - | - | - | - | $600 | $820 | $600 | - |
| 1150 | - | - | - | - | $580 | $680 | $660 | $520 |
| 1280 | - | - | - | - | - | - | $670 | $527 |
| 1300 | $1,588 | $864 | $892 | - | - | - | $610 | - |
| 1348 | $1,486 | $907 | $919 | - | - | - | - | - |
Another fascinating and underreported fact is the high levels of income, compared to others at that time, attained by the Islamic Empire Abbasid Caliphate—which was founded in present-day Iraq in 730 C.E. At its height, the empire spanned large regions of the Middle East, North Africa, and Spain until its gradual decline over 200 years.
The Industrial Revolution led to increasing inequality among nations. Some economies took off, whereas others, like many of those in Africa or Asia, remained close to a subsistence standard of living. General calculations show that the 17 countries of the world with the most-developed economies had, on average, 2.4 times the GDP per capita of the world’s poorest economies in 1870. By 1960, the most developed economies had 4.2 times the GDP per capita of the poorest economies.
However, by the middle of the twentieth century, some countries had shown that catching up was possible. Japan’s economic growth took off in the 1960s and 1970s, with a growth rate of real GDP per capita averaging 11% per year during those decades. Certain countries in Latin America experienced a boom in economic growth in the 1960s as well. In Brazil, for example, GDP per capita expanded by an average annual rate of 11.1% from 1968 to 1973. In the 1970s, some East Asian economies, including South Korea, Thailand, and Taiwan, saw rapid growth. In these countries, growth rates of 11% to 12% per year in GDP per capita were not uncommon. More recently, China, with its population of nearly 1.4 billion people, grew at a per capita rate 9% per year from 1984 into the 2000s. India, with a population of 1.3 billion, has shown promising signs of economic growth, with growth in GDP per capita of about 4% per year during the 1990s and climbing toward 7% to 8% per year in the 2000s.
Visit this website to read about the Asian Development Bank.
These waves of catch-up economic growth have not reached all shores. In certain African countries like Niger, Tanzania, and Sudan, for example, GDP per capita at the start of the 2000s was still less than $300, not much higher than it was in the nineteenth century and for centuries before that. In the context of the overall situation of low-income people around the world, the good economic news from China (population: 1.4 billion) and India (population: 1.3 billion) is, nonetheless, astounding and heartening.
Economic growth in the last two centuries has made a striking change in the human condition. Richard Easterlin, an economist at the University of Southern California, wrote in 2000:
By many measures, a revolution in the human condition is sweeping the world. Most people today are better fed, clothed, and housed than their predecessors two centuries ago. They are healthier, live longer, and are better educated. Women’s lives are less centered on reproduction and political democracy has gained a foothold. Although Western Europe and its offshoots have been the leaders of this advance, most of the less developed nations have joined in during the 20th century, with the newly emerging nations of sub-Saharan Africa the latest to participate. Although the picture is not one of universal progress, it is the greatest advance in the human condition of the world’s population ever achieved in such a brief span of time.
Rule of Law and Economic Growth
Economic growth depends on many factors. Key among those factors is adherence to the rule of law and protection of property rights and contractual rights by a country’s government so that markets can work effectively and efficiently. Laws must be clear, public, fair, enforced, and equally applicable to all members of society. Property rights, as you might recall from Environmental Protection and Negative Externalities are the rights of individuals and firms to own property and use it as they see fit. If you have $100, you have the right to use that money, whether you spend it, lend it, or keep it in a jar. It is your property. The definition of property includes physical property as well as the right to your training and experience, especially since your training is what determines your livelihood. Using this property includes the right to enter into contracts with other parties with your property. Individuals or firms must own the property to enter into a contract.
Contractual rights, then, are based on property rights and they allow individuals to enter into agreements with others regarding the use of their property providing recourse through the legal system in the event of noncompliance. One example is the employment agreement: a skilled surgeon operates on an ill person and expects payment. Failure to pay would constitute property theft by the patient. The theft is property the services that the surgeon provided. In a society with strong property rights and contractual rights, the terms of the patient–surgeon contract will be fulfilled, because the surgeon would have recourse through the court system to extract payment from that individual. Without a legal system that enforces contracts, people would not be likely to enter into contracts for current or future services because of the risk of non-payment. This would make it difficult to transact business and would slow economic growth.
The World Bank considers a country’s legal system effective if it upholds property rights and contractual rights. The World Bank has developed a ranking system for countries’ legal systems based on effective protection of property rights and rule-based governance using a scale from 1 to 6, with 1 being the lowest and 6 the highest rating. In 2013, the world average ranking was 2.9. The three countries with the lowest ranking of 1.5 were Afghanistan, the Central African Republic, and Zimbabwe. Their GDP per capita was $679, $333, and $1,007 respectively. The World Bank cites Afghanistan as having a low standard of living, weak government structure, and lack of adherence to the rule of law, which has stymied its economic growth. The landlocked Central African Republic has poor economic resources as well as political instability and is a source of children used in human trafficking. Zimbabwe has had declining and often negative growth for much of the period since 1998. Land redistribution and price controls have disrupted the economy, and corruption and violence have dominated the political process. Although global economic growth has increased, those countries lacking a clear system of property rights and an independent court system free from corruption have lagged far behind.
Key Concepts and Summary
Since the early nineteenth century, there has been a spectacular process of long-run economic growth during which the world’s leading economies—mostly those in Western Europe and North America—expanded GDP per capita at an average rate of about 2% per year. In the last half-century, countries like Japan, South Korea, and China have shown the potential to catch up. The Industrial Revolution facilitated the extensive process of economic growth, that economists often refer to as modern economic growth. This increased worker productivity and trade, as well as the development of governance and market institutions.
Self-Check Questions
Explain what the Industrial Revolution was and where it began.
Hint:
The Industrial Revolution refers to the widespread use of power-driven machinery and the economic and social changes that resulted in the first half of the 1800s. Ingenious machines—the steam engine, the power loom, and the steam locomotive—performed tasks that would have taken vast numbers of workers to do. The Industrial Revolution began in Great Britain, and soon spread to the United States, Germany, and other countries.
Explain the difference between property rights and contractual rights. Why do they matter to economic growth?
Hint:
Property rights are the rights of individuals and firms to own property and use it as they see fit. Contractual rights are based on property rights and they allow individuals to enter into agreements with others regarding the use of their property providing recourse through the legal system in the event of noncompliance. Economic growth occurs when the standard of living increases in an economy, which occurs when output is increasing and incomes are rising. For this to happen, societies must create a legal environment that gives individuals the ability to use their property to their fullest and highest use, including the right to trade or sell that property. Without a legal system that enforces contracts, people would not be likely to enter into contracts for current or future services because of the risk of non-payment. This would make it difficult to transact business and would slow economic growth.
Review Questions
How did the Industrial Revolution increase the economic growth rate and income levels in the United States?
How much should a nation be concerned if its rate of economic growth is just 2% slower than other nations?
Critical Thinking Question
Over the past 50 years, many countries have experienced an annual growth rate in real GDP per capita greater than that of the United States. Some examples are China, Japan, South Korea, and Taiwan. Does that mean the United States is regressing relative to other countries? Does that mean these countries will eventually overtake the United States in terms of the growth rate of real GDP per capita? Explain.
References
Bolt, Jutta, and Jan Luiten van Zanden. “The Maddison Project: The First Update of the Maddison Project Re-Estimating Growth Before 1820 (Maddison-Project Working Paper WP-4).” University of Groningen: Groningen Growth and Development Centre. Last modified January 2013. http://www.ggdc.net/maddison/publications/pdf/wp4.pdf.
Central Intelligence Agency. “The World Factbook: Country Comparison GDP (Purchasing Power Parity).” https://www.cia.gov/library/publications/the-world-factbook/rankorder/2001rank.html.
DeLong, Brad. “Lighting the Rocket of Growth and Lightening the Toil of Work: Another Outtake from My ‘Slouching Towards Utopia’ MS....” This is Brad DeLong's Grasping Reality (blog). September 3, 2013. http://delong.typepad.com/sdj/2013/09/lighting-the-rocket-of-growth-and-lightening-the-toil-of-work-another-outtake-from-my-slouching-towards-utopia-ms.html.
Easterlin, Richard A. “The Worldwide Standard of Living since 1800.” The Journal of Economic Perspectives. no. 1 (2000): 7–26. http://pubs.aeaweb.org/doi/pdfplus/10.1257/jep.14.1.7.
Maddison, Angus. Contours of the World Economy 1-2030 AD: Essays in Macro-Economic History. Oxford: Oxford University Press, 2007.
British Library. “Treasures in Full: Magna Carta.” http://www.bl.uk/treasures/magnacarta/.
Rothbard, Murray N. Ludwig von Mises Institute. “Property Rights and the Theory of Contracts.” The Ethics of Liberty. Last modified June 22, 2007. http://mises.org/daily/2580.
Salois, Matthew J., J. Richard Tiffin, and Kelvin George Balcombe. IDEAS: Research Division of the Federal Reserve Bank of St. Louis. “Impact of Income on Calorie and Nutrient Intakes: A Cross-Country Analysis.” Presention at the annual meeting of the Agricultural and Applied Economics Association, Pittsburg, PA, July 24–26, 2011. http://ideas.repec.org/p/ags/aaea11/103647.html.
van Zanden, Jan Luiten. The Long Road to the Industrial Revolution: The European Economy in a Global Perspective, 1000–1800 (Global Economic History Series). Boston: Brill, 2009.
The World Bank. “CPIA Property Rights and Rule-based Governance Rating (1=low to 6=high).” http://data.worldbank.org/indicator/IQ.CPA.PROP.XQ.
Rex A. Hudson, ed. Brazil: A Country Study. “Spectacular Growth, 1968–73.” Washington: GPO for the Library of Congress, 1997. http://countrystudies.us/brazil/64.htm.
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https://oercommons.org/courseware/lesson/28804/overview
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Labor Productivity and Economic Growth
Overview
By the end of this section, you will be able to:
- Identify the role of labor productivity in promoting economic growth
- Analyze the sources of economic growth using the aggregate production function
- Measure an economy’s rate of productivity growth
- Evaluate the power of sustained growth
Sustained long-term economic growth comes from increases in worker productivity, which essentially means how well we do things. In other words, how efficient is your nation with its time and workers? Labor productivity is the value that each employed person creates per unit of his or her input. The easiest way to comprehend labor productivity is to imagine a Canadian worker who can make 10 loaves of bread in an hour versus a U.S. worker who in the same hour can make only two loaves of bread. In this fictional example, the Canadians are more productive. More productivity essentially means you can do more in the same amount of time. This in turn frees up resources for workers to use elsewhere.
What determines how productive workers are? The answer is pretty intuitive. The first determinant of labor productivity is human capital. Human capital is the accumulated knowledge (from education and experience), skills, and expertise that the average worker in an economy possesses. Typically the higher the average level of education in an economy, the higher the accumulated human capital and the higher the labor productivity.
The second factor that determines labor productivity is technological change. Technological change is a combination of invention—advances in knowledge—and innovation, which is putting those advances to use in a new product or service. For example, the transistor was invented in 1947. It allowed us to miniaturize the footprint of electronic devices and use less power than the tube technology that came before it. Innovations since then have produced smaller and better transistors that are ubiquitous in products as varied as smart-phones, computers, and escalators. Developing the transistor has allowed workers to be anywhere with smaller devices. People can use these devices to communicate with other workers, measure product quality or do any other task in less time, improving worker productivity.
The third factor that determines labor productivity is economies of scale. Recall that economies of scale are the cost advantages that industries obtain due to size. (Read more about economies of scale in Production, Cost and Industry Structure.) Consider again the case of the fictional Canadian worker who could produce 10 loaves of bread in an hour. If this difference in productivity was due only to economies of scale, it could be that the Canadian worker had access to a large industrial-size oven while the U.S. worker was using a standard residential size oven.
Now that we have explored the determinants of worker productivity, let’s turn to how economists measure economic growth and productivity.
Sources of Economic Growth: The Aggregate Production Function
To analyze the sources of economic growth, it is useful to think about a production function, which is the technical relationship by which economic inputs like labor, machinery, and raw materials are turned into outputs like goods and services that consumers use. A microeconomic production function describes a firm's or perhaps an industry's inputs and outputs. In macroeconomics, we call the connection from inputs to outputs for the entire economy an aggregate production function.
Components of the Aggregate Production Function
Economists construct different production functions depending on the focus of their studies. Figure presents two examples of aggregate production functions. In the first production function in Figure (a), the output is GDP. The inputs in this example are workforce, human capital, physical capital, and technology. We discuss these inputs further in the module, Components of Economic Growth.
Measuring Productivity
An economy’s rate of productivity growth is closely linked to the growth rate of its GDP per capita, although the two are not identical. For example, if the percentage of the population who holds jobs in an economy increases, GDP per capita will increase but the productivity of individual workers may not be affected. Over the long term, the only way that GDP per capita can grow continually is if the productivity of the average worker rises or if there are complementary increases in capital.
A common measure of U.S. productivity per worker is dollar value per hour the worker contributes to the employer’s output. This measure excludes government workers, because their output is not sold in the market and so their productivity is hard to measure. It also excludes farming, which accounts for only a relatively small share of the U.S. economy. Figure shows an index of output per hour, with 2009 as the base year (when the index equals 100). The index equaled about 106 in 2014. In 1972, the index equaled 50, which shows that workers have more than doubled their productivity since then.
According to the Department of Labor, U.S. productivity growth was fairly strong in the 1950s but then declined in the 1970s and 1980s before rising again in the second half of the 1990s and the first half of the 2000s. In fact, the rate of productivity measured by the change in output per hour worked averaged 3.2% per year from 1950 to 1970; dropped to 1.9% per year from 1970 to 1990; and then climbed back to over 2.3% from 1991 to the present, with another modest slowdown after 2001. Figure shows average annual rates of productivity growth averaged over time since 1950.
The “New Economy” Controversy
In recent years a controversy has been brewing among economists about the resurgence of U.S. productivity in the second half of the 1990s. One school of thought argues that the United States had developed a “new economy” based on the extraordinary advances in communications and information technology of the 1990s. The most optimistic proponents argue that it would generate higher average productivity growth for decades to come. The pessimists, alternatively, argue that even five or ten years of stronger productivity growth does not prove that higher productivity will last for the long term. It is hard to infer anything about long-term productivity trends during the later part of the 2000s, because the steep 2008-2009 recession, with its sharp but not completely synchronized declines in output and employment, complicates any interpretation. While productivity growth was high in 2009 and 2010 (around 3%), it has slowed down since then.
Productivity growth is also closely linked to the average level of wages. Over time, the amount that firms are willing to pay workers will depend on the value of the output those workers produce. If a few employers tried to pay their workers less than what those workers produced, then those workers would receive offers of higher wages from other profit-seeking employers. If a few employers mistakenly paid their workers more than what those workers produced, those employers would soon end up with losses. In the long run, productivity per hour is the most important determinant of the average wage level in any economy. To learn how to compare economies in this regard, follow the steps in the following Work It Out feature.
Comparing the Economies of Two Countries
The Organization for Economic Co-operation and Development (OECD) tracks data on the annual growth rate of real GDP per hour worked. You can find these data on the OECD data webpage “Growth in GDP per capita, productivity and ULC” at this website.
Step 1. Visit the OECD website given above and select two countries to compare.
Step 2. On the drop-down menu “Subject,” select “ GDP per capita, constant prices,” and under “Measure,” select “Annual growth/change.” Then record the data for the countries you have chosen for the five most recent years.
Step 3. Go back to the drop-down “Subject” menu and select “GDP per hour worked, constant prices,” and under “Measure” again select “Annual growth/change.” Select data for the same years for which you selected GDP per capita data.
Step 4. Compare real GDP growth for both countries. Table provides an example of a comparison between Belgium and Canada.
| Australia | 2011 | 2012 | 2013 | 2014 | 2015 |
| Real GDP/Capita Growth (%) | 2.3% | 1.5% | 1.3% | 1.4 | 0.1% |
| Real GDP Growth/Hours Worked (%) | 1.7% | −0.1% | 1.4% | 2.2% | −0.2% |
| Belgium | 2011 | 2012 | 2013 | 2014 | 2015 |
| Real GDP/Capita Growth (%) | 0.9 | −0.6 | −0.5 | 1.2 | 1.0 |
| Real GDP Growth/Hours Worked (%) | −0.5 | −0.3 | 0.4 | 1.4 | 0.9 |
Step 5. For both measures, growth in Canada is greater than growth in Belgium for the first four years. In addition, there are year-to-year fluctuations. Many factors can affect growth. For example, one factor that may have contributed to Canada’s stronger growth may be its larger inflows of immigrants, who generally contribute to economic growth.
The Power of Sustained Economic Growth
Nothing is more important for people’s standard of living than sustained economic growth. Even small changes in the rate of growth, when sustained and compounded over long periods of time, make an enormous difference in the standard of living. Consider Table, in which the rows of the table show several different rates of growth in GDP per capita and the columns show different periods of time. Assume for simplicity that an economy starts with a GDP per capita of 100. The table then applies the following formula to calculate what GDP will be at the given growth rate in the future:
For example, an economy that starts with a GDP of 100 and grows at 3% per year will reach a GDP of 209 after 25 years; that is, 100 (1.03)25 = 209.
The slowest rate of GDP per capita growth in the table, just 1% per year, is similar to what the United States experienced during its weakest years of productivity growth. The second highest rate, 3% per year, is close to what the U.S. economy experienced during the strong economy of the late 1990s and into the 2000s. Higher rates of per capita growth, such as 5% or 8% per year, represent the experience of rapid growth in economies like Japan, Korea, and China.
Table shows that even a few percentage points of difference in economic growth rates will have a profound effect if sustained and compounded over time. For example, an economy growing at a 1% annual rate over 50 years will see its GDP per capita rise by a total of 64%, from 100 to 164 in this example. However, a country growing at a 5% annual rate will see (almost) the same amount of growth—from 100 to 163—over just 10 years. Rapid rates of economic growth can bring profound transformation. (See the following Clear It Up feature on the relationship between compound growth rates and compound interest rates.) If the rate of growth is 8%, young adults starting at age 20 will see the average standard of living in their country more than double by the time they reach age 30, and grow nearly sixfold by the time they reach age 45.
| Growth Rate | Value of an original 100 in 10 Years | Value of an original 100 in 25 Years | Value of an original 100 in 50 Years |
|---|---|---|---|
| 1% | 110 | 128 | 164 |
| 3% | 134 | 209 | 438 |
| 5% | 163 | 339 | 1,147 |
| 8% | 216 | 685 | 4,690 |
How are compound growth rates and compound interest rates related?
The formula for GDP growth rates over different periods of time, as Figure shows, is exactly the same as the formula for how a given amount of financial savings grows at a certain interest rate over time, as presented in Choice in a World of Scarcity. Both formulas have the same ingredients:
- an original starting amount, in one case GDP and in the other case an amount of financial saving;
- a percentage increase over time, in one case the GDP growth rate and in the other case an interest rate;
- and an amount of time over which this effect happens.
Recall that compound interest is interest that is earned on past interest. It causes the total amount of financial savings to grow dramatically over time. Similarly, compound rates of economic growth, or the compound growth rate, means that we multiply the rate of growth by a base that includes past GDP growth, with dramatic effects over time.
For example, in 2013, the Central Intelligence Agency's World Fact Book reported that South Korea had a GDP of $1.67 trillion with a growth rate of 2.8%. We can estimate that at that growth rate, South Korea’s GDP will be $1.92 trillion in five years. If we apply the growth rate to each year’s ending GDP for the next five years, we will calculate that at the end of year one, GDP is $1.72 trillion. In year two, we start with the end-of-year one value of $1.72 and increase it by 2.8%. Year three starts with the end-of-year two GDP, and we increase it by 2.8% and so on, as Table depicts.
| Year | Starting GDP | Growth Rate 2% | Year-End Amount |
|---|---|---|---|
| 1 | $1.67 Trillion × | (1+0.028) | $1.72 Trillion |
| 2 | $1.72 Trillion × | (1+0.028) | $1.76 Trillion |
| 3 | $1.76 Trillion × | (1+0.028) | $1.81 Trillion |
| 4 | $1.81 Trillion × | (1+0.028) | $1.87 Trillion |
| 5 | $1.87 Trillion × | (1+0.028) | $1.92 Trillion |
Another way to calculate the growth rate is to apply the following formula:
Where “future value” is the value of GDP five years hence, “present value” is the starting GDP amount of $1.67 trillion, “g” is the growth rate of 2.8%, and “n” is the number of periods for which we are calculating growth.
Key Concepts and Summary
We can measure productivity, the value of what is produced per worker, or per hour worked, as the level of GDP per worker or GDP per hour. The United States experienced a productivity slowdown between 1973 and 1989. Since then, U.S. productivity has rebounded for the most part, but annual growth in productivity in the nonfarm business sector has been less than one percent each year between 2011 and 2016. It is not clear what productivity growth will be in the coming years. The rate of productivity growth is the primary determinant of an economy’s rate of long-term economic growth and higher wages. Over decades and generations, seemingly small differences of a few percentage points in the annual rate of economic growth make an enormous difference in GDP per capita. An aggregate production function specifies how certain inputs in the economy, like human capital, physical capital, and technology, lead to the output measured as GDP per capita.
Compound interest and compound growth rates behave in the same way as productivity rates. Seemingly small changes in percentage points can have big impacts on income over time.
Self-Check Questions
Are there other ways in which we can measure productivity besides the amount produced per hour of work?
Hint:
Yes. Since productivity is output per unit of input, we can measure productivity using GDP (output) per worker (input).
Assume there are two countries: South Korea and the United States. South Korea grows at 4% and the United States grows at 1%. For the sake of simplicity, assume they both start from the same fictional income level, $10,000. What will the incomes of the United States and South Korea be in 20 years? By how many multiples will each country’s income grow in 20 years?
Hint:
In 20 years the United States will have an income of 10,000 × (1 + 0.01)20 = $12,201.90, and South Korea will have an income of 10,000 × (1 + 0.04)20 = $21,911.23. South Korea has grown by a multiple of 2.1 and the United States by a multiple of 1.2.
Review Questions
How is GDP per capita calculated differently from labor productivity?
How do gains in labor productivity lead to gains in GDP per capita?
Critical Thinking Questions
Labor Productivity and Economic Growth outlined the logic of how increased productivity is associated with increased wages. Detail a situation where this is not the case and explain why it is not.
Change in labor productivity is one of the most watched international statistics of growth. Visit the St. Louis Federal Reserve website and find the data section (http://research.stlouisfed.org). Find international comparisons of labor productivity, listed under the FRED Economic database (Growth Rate of Total Labor Productivity), and compare two countries in the recent past. State what you think the reasons for differences in labor productivity could be.
Refer back to the Work It Out about Comparing the Economies of Two Countries and examine the data for the two countries you chose. How are they similar? How are they different?
Problems
An economy starts off with a GDP per capita of $5,000. How large will the GDP per capita be if it grows at an annual rate of 2% for 20 years? 2% for 40 years? 4% for 40 years? 6% for 40 years?
An economy starts off with a GDP per capita of 12,000 euros. How large will the GDP per capita be if it grows at an annual rate of 3% for 10 years? 3% for 30 years? 6% for 30 years?
Say that the average worker in Canada has a productivity level of $30 per hour while the average worker in the United Kingdom has a productivity level of $25 per hour (both measured in U.S. dollars). Over the next five years, say that worker productivity in Canada grows at 1% per year while worker productivity in the UK grows 3% per year. After five years, who will have the higher productivity level, and by how much?
Say that the average worker in the U.S. economy is eight times as productive as an average worker in Mexico. If the productivity of U.S. workers grows at 2% for 25 years and the productivity of Mexico’s workers grows at 6% for 25 years, which country will have higher worker productivity at that point?
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oercommons
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2025-03-18T00:36:45.569632
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https://oercommons.org/courseware/lesson/28805/overview
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Components of Economic Growth
Overview
By the end of this section, you will be able to:
- Discuss the components of economic growth, including physical capital, human capital, and technology
- Explain capital deepening and its significance
- Analyze the methods employed in economic growth accounting studies
- Identify factors that contribute to a healthy climate for economic growth
Over decades and generations, seemingly small differences of a few percentage points in the annual rate of economic growth make an enormous difference in GDP per capita. In this module, we discuss some of the components of economic growth, including physical capital, human capital, and technology.
The category of physical capital includes the plant and equipment that firms use as well as things like roads (also called infrastructure). Again, greater physical capital implies more output. Physical capital can affect productivity in two ways: (1) an increase in the quantity of physical capital (for example, more computers of the same quality); and (2) an increase in the quality of physical capital (same number of computers but the computers are faster, and so on). Human capital refers to the skills and knowledge that make workers productive. Human capital and physical capital accumulation are similar: In both cases, investment now pays off in higher productivity in the future.
The category of technology is the “joker in the deck.” Earlier we described it as the combination of invention and innovation. When most people think of new technology, the invention of new products like the laser, the smartphone, or some new wonder drug come to mind. In food production, developing more drought-resistant seeds is another example of technology. Technology, as economists use the term, however, includes still more. It includes new ways of organizing work, like the invention of the assembly line, new methods for ensuring better quality of output in factories, and innovative institutions that facilitate the process of converting inputs into output. In short, technology comprises all the advances that make the existing machines and other inputs produce more, and at higher quality, as well as altogether new products.
It may not make sense to compare the GDPs of China and say, Benin, simply because of the great difference in population size. To understand economic growth, which is really concerned with the growth in living standards of an average person, it is often useful to focus on GDP per capita. Using GDP per capita also makes it easier to compare countries with smaller numbers of people, like Belgium, Uruguay, or Zimbabwe, with countries that have larger populations, like the United States, the Russian Federation, or Nigeria.
To obtain a per capita production function, divide each input in (a) by the population. This creates a second aggregate production function where the output is GDP per capita (that is, GDP divided by population). The inputs are the average level of human capital per person, the average level of physical capital per person, and the level of technology per person—see (b). The result of having population in the denominator is mathematically appealing. Increases in population lower per capita income. However, increasing population is important for the average person only if the rate of income growth exceeds population growth. A more important reason for constructing a per capita production function is to understand the contribution of human and physical capital.
Capital Deepening
When society increases the level of capital per person, we call the result capital deepening. The idea of capital deepening can apply both to additional human capital per worker and to additional physical capital per worker.
Recall that one way to measure human capital is to look at the average levels of education in an economy. Figure illustrates the human capital deepening for U.S. workers by showing that the proportion of the U.S. population with a high school and a college degree is rising. As recently as 1970, for example, only about half of U.S. adults had at least a high school diploma. By the start of the twenty-first century, more than 80% of adults had graduated from high school. The idea of human capital deepening also applies to the years of experience that workers have, but the average experience level of U.S. workers has not changed much in recent decades. Thus, the key dimension for deepening human capital in the U.S. economy focuses more on additional education and training than on a higher average level of work experience.
Figure shows physical capital deepening in the U.S. economy. The average U.S. worker in the late 2000s was working with physical capital worth almost three times as much as that of the average worker of the early 1950s.
Not only does the current U.S. economy have better-educated workers with more and improved physical capital than it did several decades ago, but these workers have access to more advanced technologies. Growth in technology is impossible to measure with a simple line on a graph, but evidence that we live in an age of technological marvels is all around us—discoveries in genetics and in the structure of particles, the wireless internet, and other inventions almost too numerous to count. The U.S. Patent and Trademark Office typically has issued more than 150,000 patents annually in recent years.
This recipe for economic growth—investing in labor productivity, with investments in human capital and technology, as well as increasing physical capital—also applies to other economies. South Korea, for example, already achieved universal enrollment in primary school (the equivalent of kindergarten through sixth grade in the United States) by 1965, when Korea’s GDP per capita was still near its rock bottom low. By the late 1980s, Korea had achieved almost universal secondary school education (the equivalent of a high school education in the United States). With regard to physical capital, Korea’s rates of investment had been about 15% of GDP at the start of the 1960s, but doubled to 30–35% of GDP by the late 1960s and early 1970s. With regard to technology, South Korean students went to universities and colleges around the world to obtain scientific and technical training, and South Korean firms reached out to study and form partnerships with firms that could offer them technological insights. These factors combined to foster South Korea’s high rate of economic growth.
Growth Accounting Studies
Since the late 1950s, economists have conducted growth accounting studies to determine the extent to which physical and human capital deepening and technology have contributed to growth. The usual approach uses an aggregate production function to estimate how much of per capita economic growth can be attributed to growth in physical capital and human capital. We can measure these two inputs at least roughly. The part of growth that is unexplained by measured inputs, called the residual, is then attributed to growth in technology. The exact numerical estimates differ from study to study and from country to country, depending on how researchers measured these three main factors and over what time horizons. For studies of the U.S. economy, three lessons commonly emerge from growth accounting studies.
First, technology is typically the most important contributor to U.S. economic growth. Growth in human capital and physical capital often explains only half or less than half of the economic growth that occurs. New ways of doing things are tremendously important.
Second, while investment in physical capital is essential to growth in labor productivity and GDP per capita, building human capital is at least as important. Economic growth is not just a matter of more machines and buildings. One vivid example of the power of human capital and technological knowledge occurred in Europe in the years after World War II (1939–1945). During the war, a large share of Europe’s physical capital, such as factories, roads, and vehicles, was destroyed. Europe also lost an overwhelming amount of human capital in the form of millions of men, women, and children who died during the war. However, the powerful combination of skilled workers and technological knowledge, working within a market-oriented economic framework, rebuilt Europe’s productive capacity to an even higher level within less than two decades.
A third lesson is that these three factors of human capital, physical capital, and technology work together. Workers with a higher level of education and skills are often better at coming up with new technological innovations. These technological innovations are often ideas that cannot increase production until they become a part of new investment in physical capital. New machines that embody technological innovations often require additional training, which builds worker skills further. If the recipe for economic growth is to succeed, an economy needs all the ingredients of the aggregate production function. See the following Clear It Up feature for an example of how human capital, physical capital, and technology can combine to significantly impact lives.
How do girls’ education and economic growth relate in low-income countries?
In the early 2000s, according to the World Bank, about 110 million children between the ages of 6 and 11 were not in school—and about two-thirds of them were girls. In Afghanistan, for example, the literacy rate for those aged 15-24 for the period 2005-2014 was 62% for males and only 32% for females. In Benin, in West Africa, it was 55% for males and 31% for females. In Nigeria, Africa’s most populous country, it was 76% for males and 58 percent for females.
Whenever any child does not receive a basic education, it is both a human and an economic loss. In low-income countries, wages typically increase by an average of 10 to 20% with each additional year of education. There is, however, some intriguing evidence that helping girls in low-income countries to close the education gap with boys may be especially important, because of the social role that many of the girls will play as mothers and homemakers.
Girls in low-income countries who receive more education tend to grow up to have fewer, healthier, better-educated children. Their children are more likely to be better nourished and to receive basic health care like immunizations. Economic research on women in low-income economies backs up these findings. When 20 women obtain one additional year of schooling, as a group they will, on average, have one less child. When 1,000 women obtain one additional year of schooling, on average one to two fewer women from that group will die in childbirth. When a woman stays in school an additional year, that factor alone means that, on average, each of her children will spend an additional half-year in school. Education for girls is a good investment because it is an investment in economic growth with benefits beyond the current generation.
A Healthy Climate for Economic Growth
While physical and human capital deepening and better technology are important, equally important to a nation’s well-being is the climate or system within which these inputs are cultivated. Both the type of market economy and a legal system that governs and sustains property rights and contractual rights are important contributors to a healthy economic climate.
A healthy economic climate usually involves some sort of market orientation at the microeconomic, individual, or firm decision-making level. Markets that allow personal and business rewards and incentives for increasing human and physical capital encourage overall macroeconomic growth. For example, when workers participate in a competitive and well-functioning labor market, they have an incentive to acquire additional human capital, because additional education and skills will pay off in higher wages. Firms have an incentive to invest in physical capital and in training workers, because they expect to earn higher profits for their shareholders. Both individuals and firms look for new technologies, because even small inventions can make work easier or lead to product improvement. Collectively, such individual and business decisions made within a market structure add up to macroeconomic growth. Much of the rapid growth since the late nineteenth century has come from harnessing the power of competitive markets to allocate resources. This market orientation typically reaches beyond national borders and includes openness to international trade.
A general orientation toward markets does not rule out important roles for government. There are times when markets fail to allocate capital or technology in a manner that provides the greatest benefit for society as a whole. The government's role is to correct these failures. In addition, government can guide or influence markets toward certain outcomes. The following examples highlight some important areas that governments around the world have chosen to invest in to facilitate capital deepening and technology:
- Education. The Danish government requires all children under 16 to attend school. They can choose to attend a public school (Folkeskole) or a private school. Students do not pay tuition to attend Folkeskole. Thirteen percent of primary/secondary (elementary/high) school is private, and the government supplies vouchers to citizens who choose private school.
- Savings and Investment. In the United States, as in other countries, the government taxes gains from private investment. Low capital gains taxes encourage investment and so also economic growth.
- Infrastructure. The Japanese government in the mid-1990s undertook significant infrastructure projects to improve roads and public works. This in turn increased the stock of physical capital and ultimately economic growth.
- Special Economic Zones. The island of Mauritius is one of the few African nations to encourage international trade in government-supported special economic zones (SEZ). These are areas of the country, usually with access to a port where, among other benefits, the government does not tax trade. As a result of its SEZ, Mauritius has enjoyed above-average economic growth since the 1980s. Free trade does not have to occur in an SEZ however. Governments can encourage international trade across the board, or surrender to protectionism.
- Scientific Research. The European Union has strong programs to invest in scientific research. The researchers Abraham García and Pierre Mohnen demonstrate that firms which received support from the Austrian government actually increased their research intensity and had more sales. Governments can support scientific research and technical training that helps to create and spread new technologies. Governments can also provide a legal environment that protects the ability of inventors to profit from their inventions.
There are many more ways in which the government can play an active role in promoting economic growth. We explore them in other chapters and in particular in Macroeconomic Policy Around the World. A healthy climate for growth in GDP per capita and labor productivity includes human capital deepening, physical capital deepening, and technological gains, operating in a market-oriented economy with supportive government policies.
Key Concepts and Summary
Over decades and generations, seemingly small differences of a few percentage points in the annual rate of economic growth make an enormous difference in GDP per capita. Capital deepening refers to an increase in the amount of capital per worker, either human capital per worker, in the form of higher education or skills, or physical capital per worker. Technology, in its economic meaning, refers broadly to all new methods of production, which includes major scientific inventions but also small inventions and even better forms of management or other types of institutions. A healthy climate for growth in GDP per capita consists of improvements in human capital, physical capital, and technology, in a market-oriented environment with supportive public policies and institutions.
Self-Check Questions
What do the growth accounting studies conclude are the determinants of growth? Which is more important, the determinants or how they are combined?
Hint:
Capital deepening and technology are important. What seems to be more important is how they are combined.
What policies can the government of a free-market economy implement to stimulate economic growth?
Hint:
Government can contribute to economic growth by investing in human capital through the education system, building a strong physical infrastructure for transportation and commerce, increasing investment by lowering capital gains taxes, creating special economic zones that allow for reduced tariffs, and investing in research and development.
List the areas where government policy can help economic growth.
Hint:
Public education, low investment taxes, funding for infrastructure projects, special economic zones
Review Questions
What is an aggregate production function?
What is capital deepening?
What do economists mean when they refer to improvements in technology?
Critical Thinking Questions
Education seems to be important for human capital deepening. As people become better educated and more knowledgeable, are there limits to how much additional benefit more education can provide? Why or why not?
Describe some of the political and social tradeoffs that might occur when a less developed country adopts a strategy to promote labor force participation and economic growth via investment in girls’ education.
Why is investing in girls’ education beneficial for growth?
How is the concept of technology, as defined with the aggregate production function, different from our everyday use of the word?
References
“Women and the World Economy: A Guide to Womenomics.” The Economist, April 12, 2006. http://www.economist.com/node/6802551.
Farole, Thomas, and Gokhan Akinci, eds. Special Economic Zones: Progress, Emerging Challenges, and Future Directions. Washington: The World Bank, 2011. http://publications.worldbank.org/index.php?main_page=product_info&products_id=24138.
Garcia, Abraham, and Pierre Mohnen. United Nations University, Maastricht Economic and Social Research and Training Centre on Innovation and Technology: UNU-MERIT. “Impact of Government Support on R&D and Innovation (Working Paper Series #2010-034).” http://www.merit.unu.edu/publications/wppdf/2010/wp2010-034.pdf.
Heston, Alan, Robert Summers, and Bettina Aten. “Penn World Table Version 7.1.” Center for International Comparisons of Production, Income and Prices at the University of Pennsylvania. Last modified July 2012. https://pwt.sas.upenn.edu/php_site/pwt71/pwt71_form.php.
United States Department of Labor: Bureau of Labor Statistics. “Women at Work: A Visual Essay.” Monthly Labor Review, October 2003, 45–50. http://www.bls.gov/opub/mlr/2003/10/ressum3.pdf.
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Economic Convergence
Overview
By the end of this section, you will be able to:
- Explain economic convergence
- Analyze various arguments for and against economic convergence
- Evaluate the speed of economic convergence between high-income countries and the rest of the world
Some low-income and middle-income economies around the world have shown a pattern of convergence, in which their economies grow faster than those of high-income countries. GDP increased by an average rate of 2.7% per year in the 1990s and 2.3% per year from 2000 to 2008 in the high-income countries of the world, which include the United States, Canada, the European Union countries, Japan, Australia, and New Zealand.
Table lists 10 countries that belong to an informal “fast growth club.” These countries averaged GDP growth (after adjusting for inflation) of at least 5% per year in both the time periods from 1990 to 2000 and from 2000 to 2008. Since economic growth in these countries has exceeded the average of the world’s high-income economies, these countries may converge with the high-income countries. The second part of Table lists the “slow growth club,” which consists of countries that averaged GDP growth of 2% per year or less (after adjusting for inflation) during the same time periods. The final portion of Table shows GDP growth rates for the countries of the world divided by income.
| Country | Average Growth Rate of Real GDP 1990–2000 | Average Growth Rate of Real GDP 2000–2008 |
|---|---|---|
| Fast Growth Club (5% or more per year in both time periods) | ||
| Cambodia | 7.1% | 9.1% |
| China | 10.6% | 9.9% |
| India | 6.0% | 7.1% |
| Ireland | 7.5% | 5.1% |
| Jordan | 5.0% | 6.3% |
| Laos | 6.5% | 6.8 % |
| Mozambique | 6.4% | 7.3% |
| Sudan | 5.4% | 7.3% |
| Uganda | 7.1% | 7.3% |
| Vietnam | 7.9% | 7.3% |
| Slow Growth Club (2% or less per year in both time periods) | ||
| Central African Republic | 2.0% | 0.8% |
| France | 2.0% | 1.8% |
| Germany | 1.8% | 1.3% |
| Guinea-Bissau | 1.2% | 0.2% |
| Haiti | –1.5% | 0.3% |
| Italy | 1.6% | 1.2% |
| Jamaica | 0.9% | 1.4% |
| Japan | 1.3% | 1.3% |
| Switzerland | 1.0% | 2.0% |
| United States (for reference) | 3.2% | 2.2% |
| World Overview | ||
| High income | 2.7% | 2.3% |
| Low income | 3.8% | 5.6% |
| Middle income | 4.7% | 6.1% |
Each of the countries in Table has its own unique story of investments in human and physical capital, technological gains, market forces, government policies, and even lucky events, but an overall pattern of convergence is clear. The low-income countries have GDP growth that is faster than that of the middle-income countries, which in turn have GDP growth that is faster than that of the high-income countries. Two prominent members of the fast-growth club are China and India, which between them have nearly 40% of the world’s population. Some prominent members of the slow-growth club are high-income countries like France, Germany, Italy, and Japan.
Will this pattern of economic convergence persist into the future? This is a controversial question among economists that we will consider by looking at some of the main arguments on both sides.
Arguments Favoring Convergence
Several arguments suggest that low-income countries might have an advantage in achieving greater worker productivity and economic growth in the future.
A first argument is based on diminishing marginal returns. Even though deepening human and physical capital will tend to increase GDP per capita, the law of diminishing returns suggests that as an economy continues to increase its human and physical capital, the marginal gains to economic growth will diminish. For example, raising the average education level of the population by two years from a tenth-grade level to a high school diploma (while holding all other inputs constant) would produce a certain increase in output. An additional two-year increase, so that the average person had a two-year college degree, would increase output further, but the marginal gain would be smaller. Yet another additional two-year increase in the level of education, so that the average person would have a four-year-college bachelor’s degree, would increase output still further, but the marginal increase would again be smaller. A similar lesson holds for physical capital. If the quantity of physical capital available to the average worker increases, by, say, $5,000 to $10,000 (again, while holding all other inputs constant), it will increase the level of output. An additional increase from $10,000 to $15,000 will increase output further, but the marginal increase will be smaller.
Low-income countries like China and India tend to have lower levels of human capital and physical capital, so an investment in capital deepening should have a larger marginal effect in these countries than in high-income countries, where levels of human and physical capital are already relatively high. Diminishing returns implies that low-income economies could converge to the levels that the high-income countries achieve.
A second argument is that low-income countries may find it easier to improve their technologies than high-income countries. High-income countries must continually invent new technologies, whereas low-income countries can often find ways of applying technology that has already been invented and is well understood. The economist Alexander Gerschenkron (1904–1978) gave this phenomenon a memorable name: “the advantages of backwardness.” Of course, he did not literally mean that it is an advantage to have a lower standard of living. He was pointing out that a country that is behind has some extra potential for catching up.
Finally, optimists argue that many countries have observed the experience of those that have grown more quickly and have learned from it. Moreover, once the people of a country begin to enjoy the benefits of a higher standard of living, they may be more likely to build and support the market-friendly institutions that will help provide this standard of living.
View this video to learn about economic growth across the world.
Arguments That Convergence Is neither Inevitable nor Likely
If the economy's growth depended only on the deepening of human capital and physical capital, then we would expect that economy's growth rate to slow down over the long run because of diminishing marginal returns. However, there is another crucial factor in the aggregate production function: technology.
Developing new technology can provide a way for an economy to sidestep the diminishing marginal returns of capital deepening. Figure shows how. The figure's horizontal axis measures the amount of capital deepening, which on this figure is an overall measure that includes deepening of both physical and human capital. The amount of human and physical capital per worker increases as you move from left to right, from C1 to C2 to C3. The diagram's vertical axis measures per capita output. Start by considering the lowest line in this diagram, labeled Technology 1. Along this aggregate production function, the level of technology is held constant, so the line shows only the relationship between capital deepening and output. As capital deepens from C1 to C2 to C3 and the economy moves from R to U to W, per capita output does increase—but the way in which the line starts out steeper on the left but then flattens as it moves to the right shows the diminishing marginal returns, as additional marginal amounts of capital deepening increase output by ever-smaller amounts. The shape of the aggregate production line (Technology 1) shows that the ability of capital deepening, by itself, to generate sustained economic growth is limited, since diminishing returns will eventually set in.
Now, bring improvements in technology into the picture. Improved technology means that with a given set of inputs, more output is possible. The production function labeled Technology 1 in the figure is based on one level of technology, but Technology 2 is based on an improved level of technology, so for every level of capital deepening on the horizontal axis, it produces a higher level of output on the vertical axis. In turn, production function Technology 3 represents a still higher level of technology, so that for every level of inputs on the horizontal axis, it produces a higher level of output on the vertical axis than either of the other two aggregate production functions.
Most healthy, growing economies are deepening their human and physical capital and increasing technology at the same time. As a result, the economy can move from a choice like point R on the Technology 1 aggregate production line to a point like S on Technology 2 and a point like T on the still higher aggregate production line (Technology 3). With the combination of technology and capital deepening, the rise in GDP per capita in high-income countries does not need to fade away because of diminishing returns. The gains from technology can offset the diminishing returns involved with capital deepening.
Will technological improvements themselves run into diminishing returns over time? That is, will it become continually harder and more costly to discover new technological improvements? Perhaps someday, but, at least over the last two centuries since the beginning of the Industrial Revolution, improvements in technology have not run into diminishing marginal returns. Modern inventions, like the internet or discoveries in genetics or materials science, do not seem to provide smaller gains to output than earlier inventions like the steam engine or the railroad. One reason that technological ideas do not seem to run into diminishing returns is that we often can apply widely the ideas of new technology at a marginal cost that is very low or even zero. A specific worker or group of workers must use a specific additional machine, or an additional year of education. Many workers across the economy can use a new technology or invention at very low marginal cost.
The argument that it is easier for a low-income country to copy and adapt existing technology than it is for a high-income country to invent new technology is not necessarily true, either. When it comes to adapting and using new technology, a society’s performance is not necessarily guaranteed, but is the result of whether the country's economic, educational, and public policy institutions are supportive. In theory, perhaps, low-income countries have many opportunities to copy and adapt technology, but if they lack the appropriate supportive economic infrastructure and institutions, the theoretical possibility that backwardness might have certain advantages is of little practical relevance.
Visit this website to read more about economic growth in India.
The Slowness of Convergence
Although economic convergence between the high-income countries and the rest of the world seems possible and even likely, it will proceed slowly. Consider, for example, a country that starts off with a GDP per capita of $40,000, which would roughly represent a typical high-income country today, and another country that starts out at $4,000, which is roughly the level in low-income but not impoverished countries like Indonesia, Guatemala, or Egypt. Say that the rich country chugs along at a 2% annual growth rate of GDP per capita, while the poorer country grows at the aggressive rate of 7% per year. After 30 years, GDP per capita in the rich country will be $72,450 (that is, $40,000 (1 + 0.02)30) while in the poor country it will be $30,450 (that is, $4,000 (1 + 0.07)30). Convergence has occurred. The rich country used to be 10 times as wealthy as the poor one, and now it is only about 2.4 times as wealthy. Even after 30 consecutive years of very rapid growth, however, people in the low-income country are still likely to feel quite poor compared to people in the rich country. Moreover, as the poor country catches up, its opportunities for catch-up growth are reduced, and its growth rate may slow down somewhat.
The slowness of convergence illustrates again that small differences in annual rates of economic growth become huge differences over time. The high-income countries have been building up their advantage in standard of living over decades—more than a century in some cases. Even in an optimistic scenario, it will take decades for the low-income countries of the world to catch up significantly.
Calories and Economic Growth
We can tell the story of modern economic growth by looking at calorie consumption over time. The dramatic rise in incomes allowed the average person to eat better and consume more calories. How did these incomes increase? The neoclassical growth consensus uses the aggregate production function to suggest that the period of modern economic growth came about because of increases in inputs such as technology and physical and human capital. Also important was the way in which technological progress combined with physical and human capital deepening to create growth and convergence. The issue of distribution of income notwithstanding, it is clear that the average worker can afford more calories in 2017 than in 1875.
Aside from increases in income, there is another reason why the average person can afford more food. Modern agriculture has allowed many countries to produce more food than they need. Despite having more than enough food, however, many governments and multilateral agencies have not solved the food distribution problem. In fact, food shortages, famine, or general food insecurity are caused more often by the failure of government macroeconomic policy, according to the Nobel Prize-winning economist Amartya Sen. Sen has conducted extensive research into issues of inequality, poverty, and the role of government in improving standards of living. Macroeconomic policies that strive toward stable inflation, full employment, education of women, and preservation of property rights are more likely to eliminate starvation and provide for a more even distribution of food.
Because we have more food per capita, global food prices have decreased since 1875. The prices of some foods, however, have decreased more than the prices of others. For example, researchers from the University of Washington have shown that in the United States, calories from zucchini and lettuce are 100 times more expensive than calories from oil, butter, and sugar. Research from countries like India, China, and the United States suggests that as incomes rise, individuals want more calories from fats and protein and fewer from carbohydrates. This has very interesting implications for global food production, obesity, and environmental consequences. Affluent urban India has an obesity problem much like many parts of the United States. The forces of convergence are at work.
Key Concepts and Summary
When countries with lower GDP levels per capita catch up to countries with higher GDP levels per capita, we call the process convergence. Convergence can occur even when both high- and low-income countries increase investment in physical and human capital with the objective of growing GDP. This is because the impact of new investment in physical and human capital on a low-income country may result in huge gains as new skills or equipment combine with the labor force. In higher-income countries, however, a level of investment equal to that of the low income country is not likely to have as big an impact, because the more developed country most likely already has high levels of capital investment. Therefore, the marginal gain from this additional investment tends to be successively less and less. Higher income countries are more likely to have diminishing returns to their investments and must continually invent new technologies. This allows lower-income economies to have a chance for convergent growth. However, many high-income economies have developed economic and political institutions that provide a healthy economic climate for an ongoing stream of technological innovations. Continuous technological innovation can counterbalance diminishing returns to investments in human and physical capital.
Self-Check Questions
Use an example to explain why, after periods of rapid growth, a low-income country that has not caught up to a high-income country may feel poor.
Hint:
A good way to think about this is how a runner who has fallen behind in a race feels psychologically and physically as he catches up. Playing catch-up can be more taxing than maintaining one’s position at the head of the pack.
Would the following events usually lead to capital deepening? Why or why not?
- A weak economy in which businesses become reluctant to make long-term investments in physical capital.
- A rise in international trade.
- A trend in which many more adults participate in continuing education courses through their employers and at colleges and universities.
Hint:
- No. Capital deepening refers to an increase in the amount of capital per person in an economy. A decrease in investment by firms will actually cause the opposite of capital deepening (since the population will grow over time).
- There is no direct connection between an increase in international trade and capital deepening. One could imagine particular scenarios where trade could lead to capital deepening (for example, if international capital inflows—which are the counterpart to increasing the trade deficit—lead to an increase in physical capital investment), but in general, no.
- Yes. Capital deepening refers to an increase in either physical capital or human capital per person. Continuing education or any time of lifelong learning adds to human capital and thus creates capital deepening.
What are the “advantages of backwardness” for economic growth?
Hint:
The advantages of backwardness include faster growth rates because of the process of convergence, as well as the ability to adopt new technologies that were developed first in the “leader” countries. While being “backward” is not inherently a good thing, Gerschenkron stressed that there are certain advantages which aid countries trying to “catch up.”
Would you expect capital deepening to result in diminished returns? Why or why not? Would you expect improvements in technology to result in diminished returns? Why or why not?
Hint:
Capital deepening, by definition, should lead to diminished returns because you're investing more and more but using the same methods of production, leading to the marginal productivity declining. This is shown on a production function as a movement along the curve. Improvements in technology should not lead to diminished returns because you are finding new and more efficient ways of using the same amount of capital. This can be illustrated as a shift upward of the production function curve.
Why does productivity growth in high-income economies not slow down as it runs into diminishing returns from additional investments in physical capital and human capital? Does this show one area where the theory of diminishing returns fails to apply? Why or why not?
Hint:
Productivity growth from new advances in technology will not slow because the new methods of production will be adopted relatively quickly and easily, at very low marginal cost. Also, countries that are seeing technology growth usually have a vast and powerful set of institutions for training workers and building better machines, which allows the maximum amount of people to benefit from the new technology. These factors have the added effect of making additional technological advances even easier for these countries.
Review Questions
For a high-income economy like the United States, what aggregate production function elements are most important in bringing about growth in GDP per capita? What about a middle-income country such as Brazil? A low-income country such as Niger?
List some arguments for and against the likelihood of convergence.
Critical Thinking Questions
What sorts of policies can governments implement to encourage convergence?
As technological change makes us more sedentary and food costs increase, obesity is likely. What factors do you think may limit obesity?
References
Central Intelligence Agency. “The World Factbook: Country Comparison: GDP–Real Growth Rate.” https://www.cia.gov/library/publications/the-world-factbook/rankorder/2003rank.html.
Sen, Amartya. “Hunger in the Contemporary World (Discussion Paper DEDPS/8).” The Suntory Centre: London School of Economics and Political Science. Last modified November 1997. http://sticerd.lse.ac.uk/dps/de/dedps8.pdf.
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Introduction to Inflation
A $550 Million Loaf of Bread?
If you were born within the last three decades in the United States, Canada, or many other countries in the developed world, you probably have no real experience with a high rate of inflation. Inflation is when most prices in an entire economy are rising. However, there is an extreme form of inflation called hyperinflation. This occurred in Germany between 1921 and 1928, and more recently in Zimbabwe between 2008 and 2009. In November 2008, Zimbabwe had an inflation rate of 79.6 billion percent. In contrast, in 2014, the United States had an average annual rate of inflation of 1.6%.
Zimbabwe’s inflation rate was so high it is difficult to comprehend, so let’s put it into context. It is equivalent to price increases of 98% per day. This means that, from one day to the next, prices essentially double. What is life like in an economy afflicted with hyperinflation? Most of you reading this will have never experienced this phenomenon. The government adjusted prices for commodities in Zimbabwean dollars several times each day. There was no desire to hold on to currency since it lost value by the minute. The people there spent a great deal of time getting rid of any cash they acquired by purchasing whatever food or other commodities they could find. At one point, a loaf of bread cost 550 million Zimbabwean dollars. Teachers' salaries were in the trillions a month; however, this was equivalent to only one U.S. dollar a day. At its height, it took 621,984,228 Zimbabwean dollars to purchase one U.S. dollar.
Government agencies had no money to pay their workers so they started printing money to pay their bills rather than raising taxes. Rising prices caused the government to enact price controls on private businesses, which led to shortages and the emergence of black markets. In 2009, the country abandoned its currency and allowed people to use foreign currencies for purchases.
How does this happen? How can both government and the economy fail to function at the most basic level? Before we consider these extreme cases of hyperinflation, let’s first look at inflation itself.
Introduction to Inflation
In this chapter, you will learn about:
- Tracking Inflation
- How to Measure Changes in the Cost of Living
- How the U.S. and Other Countries Experience Inflation
- The Confusion Over Inflation
- Indexing and Its Limitations
Inflation is a general and ongoing rise in the level of prices in an entire economy. Inflation does not refer to a change in relative prices. A relative price change occurs when you see that the price of tuition has risen, but the price of laptops has fallen. Inflation, on the other hand, means that there is pressure for prices to rise in most markets in the economy. In addition, price increases in the supply-and-demand model were one-time events, representing a shift from a previous equilibrium to a new one. Inflation implies an ongoing rise in prices. If inflation happened for one year and then stopped, then it would not be inflation any more.
This chapter begins by showing how to combine prices of individual goods and services to create a measure of overall inflation. It discusses the historical and recent experience of inflation, both in the United States and in other countries around the world. Other chapters have sometimes included a note under an exhibit or a parenthetical reminder in the text saying that the numbers have been adjusted for inflation. In this chapter, it is time to show how to use inflation statistics to adjust other economic variables, so that you can tell how much of, for example, we can attribute the rise in GDP over different periods of time to an actual increase in the production of goods and services and how much we should attribute to the fact that prices for most items have risen.
Inflation has consequences for people and firms throughout the economy, in their roles as lenders and borrowers, wage-earners, taxpayers, and consumers. The chapter concludes with a discussion of some imperfections and biases in the inflation statistics, and a preview of policies for fighting inflation that we will discuss in other chapters.
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Tracking Inflation
Overview
By the end of this section, you will be able to:
- Calculate the annual rate of inflation
- Explain and use index numbers and base years when simplifying the total quantity spent over a year for products
- Calculate inflation rates using index numbers
Dinner table conversations where you might have heard about inflation usually entail reminiscing about when “everything seemed to cost so much less. You used to be able to buy three gallons of gasoline for a dollar and then go see an afternoon movie for another dollar.” Table compares some prices of common goods in 1970 and 2017. Of course, the average prices in this table may not reflect the prices where you live. The cost of living in New York City is much higher than in Houston, Texas, for example. In addition, certain products have evolved over recent decades. A new car in 2017, loaded with antipollution equipment, safety gear, computerized engine controls, and many other technological advances, is a more advanced machine (and more fuel efficient) than your typical 1970s car. However, put details like these to one side for the moment, and look at the overall pattern. The primary reason behind the price rises in Table—and all the price increases for the other products in the economy—is not specific to the market for housing or cars or gasoline or movie tickets. Instead, it is part of a general rise in the level of all prices. At the beginning of 2017, $1 had about the same purchasing power in overall terms of goods and services as 18 cents did in 1972, because of the amount of inflation that has occurred over that time period.
| Items | 1970 | 2017 |
|---|---|---|
| Pound of ground beef | $0.66 | $3.62 |
| Pound of butter | $0.87 | $2.03 |
| Movie ticket | $1.55 | $8.65 |
| Sales price of new home (median) | $22,000 | $312,900 |
| New car | $3,000 | $4,077 |
| Gallon of gasoline | $0.36 | $2.35 |
| Average hourly wage for a manufacturing worker | $3.23 | $20.65 |
| Per capita GDP | $5,069 | $57,294 |
Moreover, the power of inflation does not affect just goods and services, but wages and income levels, too. The second-to-last row of Table shows that the average hourly wage for a manufacturing worker increased nearly six-fold from 1970 to 2017. The average worker in 2017 is better educated and more productive than the average worker in 1970—but not six times more productive. Per capita GDP increased substantially from 1970 to 2017, but is the average person in the U.S. economy really more than eleven times better off in just 47 years? Not likely.
A modern economy has millions of goods and services whose prices are continually quivering in the breezes of supply and demand. How can all of these shifts in price attribute to a single inflation rate? As with many problems in economic measurement, the conceptual answer is reasonably straightforward: Economists combine prices of a variety of goods and services into a single price level. The inflation rate is simply the percentage change in the price level. Applying the concept, however, involves some practical difficulties.
The Price of a Basket of Goods
To calculate the price level, economists begin with the concept of a basket of goods and services, consisting of the different items individuals, businesses, or organizations typically buy. The next step is to look at how the prices of those items change over time. In thinking about how to combine individual prices into an overall price level, many people find that their first impulse is to calculate the average of the prices. Such a calculation, however, could easily be misleading because some products matter more than others.
Changes in the prices of goods for which people spend a larger share of their incomes will matter more than changes in the prices of goods for which people spend a smaller share of their incomes. For example, an increase of 10% in the rental rate on housing matters more to most people than whether the price of carrots rises by 10%. To construct an overall measure of the price level, economists compute a weighted average of the prices of the items in the basket, where the weights are based on the actual quantities of goods and services people buy. The following Work It Out feature walks you through the steps of calculating the annual rate of inflation based on a few products.
Calculating an Annual Rate of Inflation
Consider the simple basket of goods with only three items, represented in Table. Say that in any given month, a college student spends money on 20 hamburgers, one bottle of aspirin, and five movies. The table provides prices for these items over four years through each time period (Pd). Prices of some goods in the basket may rise while others fall. In this example, the price of aspirin does not change over the four years, while movies increase in price and hamburgers bounce up and down. The table shows the cost of buying the given basket of goods at the prices prevailing at that time.
| Items | Hamburger | Aspirin | Movies | Total | Inflation Rate |
|---|---|---|---|---|---|
| Qty | 20 | 1 bottle | 5 | - | - |
| (Pd 1) Price | $3.00 | $10.00 | $6.00 | - | - |
| (Pd 1) Amount Spent | $60.00 | $10.00 | $30.00 | $100.00 | - |
| (Pd 2) Price | $3.20 | $10.00 | $6.50 | - | - |
| (Pd 2) Amount Spent | $64.00 | $10.00 | $32.50 | $106.50 | 6.5% |
| (Pd 3) Price | $3.10 | $10.00 | $7.00 | - | - |
| (Pd 3) Amount Spent | $62.00 | $10.00 | $35.00 | $107.00 | 0.5% |
| (Pd 4) Price | $3.50 | $10.00 | $7.50 | - | - |
| (Pd 4) Amount Spent | $70.00 | $10.00 | $37.50 | $117.50 | 9.8% |
To calculate the annual rate of inflation in this example:
Step 1. Find the percentage change in the cost of purchasing the overall basket of goods between the time periods. The general equation for percentage changes between two years, whether in the context of inflation or in any other calculation, is:
Step 2. From period 1 to period 2, the total cost of purchasing the basket of goods in Table rises from $100 to $106.50. Therefore, the percentage change over this time—the inflation rate—is:
Step 3. From period 2 to period 3, the overall change in the cost of purchasing the basket rises from $106.50 to $107. Thus, the inflation rate over this time, again calculated by the percentage change, is approximately:
Step 4. From period 3 to period 4, the overall cost rises from $107 to $117.50. The inflation rate is thus:
This calculation of the change in the total cost of purchasing a basket of goods accounts for how much a student spends on each good. Hamburgers are the lowest-priced good in this example, and aspirin is the highest-priced. If an individual buys a greater quantity of a low-price good, then it makes sense that changes in the price of that good should have a larger impact on the buying power of that person’s money. The larger impact of hamburgers shows up in the “amount spent” row, where, in all time periods, hamburgers are the largest item within the amount spent row.
Index Numbers
The numerical results of a calculation based on a basket of goods can get a little messy. The simplified example in Table has only three goods and the prices are in even dollars, not numbers like 79 cents or $124.99. If the list of products were much longer, and we used more realistic prices, the total quantity spent over a year might be some messy-looking number like $17,147.51 or $27,654.92.
To simplify the task of interpreting the price levels for more realistic and complex baskets of goods, economists typically report the price level in each period as an index number, rather than as the dollar amount for buying the basket of goods. Economists create price indices to calculate an overall average change in relative prices over time. To convert the money spent on the basket to an index number, economists arbitrarily choose one year to be the base year, or starting point from which we measure changes in prices. The base year, by definition, has an index number equal to 100. This sounds complicated, but it is really a simple math trick. In the example above, say that we choose time period 3 as the base year. Since the total amount of spending in that year is $107, we divide that amount by itself ($107) and multiply by 100. Again, this is because the index number in the base year always has to have a value of 100. Then, to figure out the values of the index number for the other years, we divide the dollar amounts for the other years by 1.07 as well. Note also that the dollar signs cancel out so that index numbers have no units.
Table shows calculations for the other values of the index number, based on the example in Table. Because we calculate the index numbers so that they are in exactly the same proportion as the total dollar cost of purchasing the basket of goods, we can calculate the inflation rate based on the index numbers, using the percentage change formula. Thus, the inflation rate from period 1 to period 2 would be
This is the same answer that we derived when measuring inflation based on the dollar cost of the basket of goods for the same time period.
| Total Spending | Index Number | Inflation Rate Since Previous Period | |
|---|---|---|---|
| Period 1 | $100 | ||
| Period 2 | $106.50 | ||
| Period 3 | $107 | ||
| Period 4 | $117.50 |
If the inflation rate is the same whether it is based on dollar values or index numbers, then why bother with the index numbers? The advantage is that indexing allows easier eyeballing of the inflation numbers. If you glance at two index numbers like 107 and 110, you know automatically that the rate of inflation between the two years is about, but not quite exactly equal to, 3%. By contrast, imagine that we express the price levels in absolute dollars of a large basket of goods, so that when you looked at the data, the numbers were $19,493.62 and $20,040.17. Most people find it difficult to eyeball those kinds of numbers and say that it is a change of about 3%. However, the two numbers expressed in absolute dollars are exactly in the same proportion of 107 to 110 as the previous example. If you’re wondering why simple subtraction of the index numbers wouldn’t work, read the following Clear It Up feature.
Why do you not just subtract index numbers?
A word of warning: When a price index moves from, say, 107 to 110, the rate of inflation is not exactly 3%. Remember, the inflation rate is not derived by subtracting the index numbers, but rather through the percentage-change calculation. We calculate the precise inflation rate as the price index moves from 107 to 110 as 100 x (110 – 107) / 107 = 100 x 0.028 = 2.8%. When the base year is fairly close to 100, a quick subtraction is not a terrible shortcut to calculating the inflation rate—but when precision matters down to tenths of a percent, subtracting will not give the right answer.
Two final points about index numbers are worth remembering. First, index numbers have no dollar signs or other units attached to them. Although we can use index numbers to calculate a percentage inflation rate, the index numbers themselves do not have percentage signs. Index numbers just mirror the proportions that we find in other data. They transform the other data so that it is easier to work with the data.
Second, the choice of a base year for the index number—that is, the year that is automatically set equal to 100—is arbitrary. We choose it as a starting point from which we can track changes in prices. In the official inflation statistics, it is common to use one base year for a few years, and then to update it, so that the base year of 100 is relatively close to the present. However, any base year that we choose for the index numbers will result in exactly the same inflation rate. To see this in the previous example, imagine that period 1 is the base year when total spending was $100, and we assign it an index number of 100. At a glance, you can see that the index numbers would now exactly match the dollar figures, and the inflation rate in the first period would be 6.5%.
Now that we see how indexes work to track inflation, the next module will show us how economists measure the cost of living.
Watch this video from the cartoon Duck Tales to view a mini-lesson on inflation.
Key Concepts and Summary
Economists measure the price level by using a basket of goods and services and calculating how the total cost of buying that basket of goods will increase over time. Economists often express the price level in terms of index numbers, which transform the cost of buying the basket of goods and services into a series of numbers in the same proportion to each other, but with an arbitrary base year of 100. We measure the inflation rate as the percentage change between price levels or index numbers over time.
Self-Check Questions
Table shows the fruit prices that the typical college student purchased from 2001 to 2004. What is the amount spent each year on the “basket” of fruit with the quantities shown in column 2?
| Items | Qty | (2001) Price | (2001) Amount Spent | (2002) Price | (2002) Amount Spent | (2003) Price | (2003) Amount Spent | (2004) Price | (2004) Amount Spent |
|---|---|---|---|---|---|---|---|---|---|
| Apples | 10 | $0.50 | $0.75 | $0.85 | $0.88 | ||||
| Bananas | 12 | $0.20 | $0.25 | $0.25 | $0.29 | ||||
| Grapes | 2 | $0.65 | $0.70 | $0.90 | $0.95 | ||||
| Raspberries | 1 | $2.00 | $1.90 | $2.05 | $2.13 | $2.13 | |||
| Total |
Hint:
To compute the amount spent on each fruit in each year, you multiply the quantity of each fruit by the price.
- 10 apples × 50 cents each = $5.00 spent on apples in 2001.
- 12 bananas × 20 cents each = $2.40 spent on bananas in 2001.
- 2 bunches of grapes at 65 cents each = $1.30 spent on grapes in 2001.
- 1 pint of raspberries at $2 each = $2.00 spent on raspberries in 2001.
Adding up the amounts gives you the total cost of the fruit basket. The total cost of the fruit basket in 2001 was $5.00 + $2.40 + $1.30 + $2.00 = $10.70. The total costs for all the years are shown in the following table.
| 2001 | 2002 | 2003 | 2004 |
|---|---|---|---|
| $10.70 | $13.80 | $15.35 | $16.31 |
Construct the price index for a “fruit basket” in each year using 2003 as the base year.
Hint:
If 2003 is the base year, then the index number has a value of 100 in 2003. To transform the cost of a fruit basket each year, we divide each year’s value by $15.35, the value of the base year, and then multiply the result by 100. The price index is shown in the following table.
| 2001 | 2002 | 2003 | 2004 |
|---|---|---|---|
| 69.71 | 89.90 | 100.00 | 106.3 |
Note that the base year has a value of 100; years before the base year have values less than 100; and years after have values more than 100.
Compute the inflation rate for fruit prices from 2001 to 2004.
Hint:
The inflation rate is calculated as the percentage change in the price index from year to year. For example, the inflation rate between 2001 and 2002 is (84.61 – 69.71) / 69.71 = 0.2137 = 21.37%. The inflation rates for all the years are shown in the last row of the following table, which includes the two previous answers.
| Items | Qty | (2001) Price | (2001) Amount Spent | (2002) Price | (2002) Amount Spent | (2003) Price | (2003) Amount Spent | (2004) Price | (2004) Amount Spent |
|---|---|---|---|---|---|---|---|---|---|
| Apples | 10 | $0.50 | $5.00 | $0.75 | $7.50 | $0.85 | $8.50 | $0.88 | $8.80 |
| Bananas | 12 | $0.20 | $2.40 | $0.25 | $3.00 | $0.25 | $3.00 | $0.29 | $3.48 |
| Grapes | 2 | $0.65 | $1.30 | $0.70 | $1.40 | $0.90 | $1.80 | $0.95 | $1.90 |
| Raspberries | 1 | $2.00 | $2.00 | $1.90 | $1.90 | $2.05 | $2.05 | $2.13 | $2.13 |
| Total | $10.70 | $13.80 | $15.35 | $16.31 | |||||
| Price Index | 69.71 | 84.61 | 100.00 | 106.3 | |||||
| Inflation Rate | 21.37% | 18.19% | 6.3% |
Edna is living in a retirement home where most of her needs are taken care of, but she has some discretionary spending. Based on the basket of goods in Table, by what percentage does Edna’s cost of living increase between time 1 and time 2?
| Items | Quantity | (Time 1) Price | (Time 2) Price |
|---|---|---|---|
| Gifts for grandchildren | 12 | $50 | $60 |
| Pizza delivery | 24 | $15 | $16 |
| Blouses | 6 | $60 | $50 |
| Vacation trips | 2 | $400 | $420 |
Hint:
Begin by calculating the total cost of buying the basket in each time period, as shown in the following table.
| Items | Quantity | (Time 1) Price | (Time 1) Total Cost | (Time 2) Price | (Time 2) Total Cost |
|---|---|---|---|---|---|
| Gifts | 12 | $50 | $600 | $60 | $720 |
| Pizza | 24 | $15 | $360 | $16 | $384 |
| Blouses | 6 | $60 | $360 | $50 | $300 |
| Trips | 2 | $400 | $800 | $420 | $840 |
| Total Cost | $2,120 | $2,244 |
The rise in cost of living is calculated as the percentage increase:
(2244 – 2120) / 2120 = 0.0585 = 5.85%.
Review Questions
How do economists use a basket of goods and services to measure the price level?
Why do economists use index numbers to measure the price level rather than dollar value of goods?
What is the difference between the price level and the rate of inflation?
Critical Thinking Question
Inflation rates, like most statistics, are imperfect measures. Can you identify some ways that the inflation rate for fruit does not perfectly capture the rising price of fruit?
Problems
The index number representing the price level changes from 110 to 115 in one year, and then from 115 to 120 the next year. Since the index number increases by five each year, is five the inflation rate each year? Is the inflation rate the same each year? Explain your answer.
The total price of purchasing a basket of goods in the United Kingdom over four years is: year 1=£940, year 2=£970, year 3=£1000, and year 4=£1070. Calculate two price indices, one using year 1 as the base year (set equal to 100) and the other using year 4 as the base year (set equal to 100). Then, calculate the inflation rate based on the first price index. If you had used the other price index, would you get a different inflation rate? If you are unsure, do the calculation and find out.
References
Sources for Table:
http://www.eia.gov/dnav/pet/pet_pri_gnd_a_epmr_pte_dpgal_w.htm
http://data.bls.gov/cgi-bin/surveymost?ap
http://www.bls.gov/ro3/apmw.htm
http://www.autoblog.com/2014/03/12/who-can-afford-the-average-car-price-only-folks-in-washington/
https://www.census.gov/construction/nrs/pdf/uspricemon.pdf
http://www.bls.gov/news.release/empsit.t24.htm
http://variety.com/2015/film/news/movie-ticket-prices-increased-in-2014-1201409670/
US Inflation Calculator. "Historical Inflation Rates: 1914-2013." Accessed March 4, 2015. http://www.usinflationcalculator.com/inflation/historical-inflation-rates/.
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How to Measure Changes in the Cost of Living
Overview
By the end of this section, you will be able to:
- Use the Consumer Price Index (CPI) to calculate U.S. inflation rates
- Identify several ways the Bureau of Labor Statistics avoids biases in the Consumer Price Index (CPI)
- Differentiate among the Consumer Price Index (CPI), the Producer Price Index (PPI), the International Price Index, the Employment Cost Index, and the GDP deflator.
The most commonly cited measure of inflation in the United States is the Consumer Price Index (CPI). Government statisticians at the U.S. Bureau of Labor Statistics calculate the CPI based on the prices in a fixed basket of goods and services that represents the purchases of the average family of four. In recent years, the statisticians have paid considerable attention to a subtle problem: that the change in the total cost of buying a fixed basket of goods and services over time is conceptually not quite the same as the change in the cost of living, because the cost of living represents how much it costs for a person to feel that his or her consumption provides an equal level of satisfaction or utility.
To understand the distinction, imagine that over the past 10 years, the cost of purchasing a fixed basket of goods increased by 25% and your salary also increased by 25%. Has your personal standard of living held constant? If you do not necessarily purchase an identical fixed basket of goods every year, then an inflation calculation based on the cost of a fixed basket of goods may be a misleading measure of how your cost of living has changed. Two problems arise here: substitution bias and quality/new goods bias.
When the price of a good rises, consumers tend to purchase less of it and to seek out substitutes instead. Conversely, as the price of a good falls, people will tend to purchase more of it. This pattern implies that goods with generally rising prices should tend over time to become less important in the overall basket of goods used to calculate inflation, while goods with falling prices should tend to become more important. Consider, as an example, a rise in the price of peaches by $100 per pound. If consumers were utterly inflexible in their demand for peaches, this would lead to a big rise in the price of food for consumers. Alternatively, imagine that people are utterly indifferent to whether they have peaches or other types of fruit. Now, if peach prices rise, people completely switch to other fruit choices and the average price of food does not change at all. A fixed and unchanging basket of goods assumes that consumers are locked into buying exactly the same goods, regardless of price changes—not a very likely assumption. Thus, substitution bias—the rise in the price of a fixed basket of goods over time—tends to overstate the rise in a consumer’s true cost of living, because it does not take into account that the person can substitute away from goods whose relative prices have risen.
The other major problem in using a fixed basket of goods as the basis for calculating inflation is how to deal with the arrival of improved versions of older goods or altogether new goods. Consider the problem that arises if a cereal is improved by adding 12 essential vitamins and minerals—and also if a box of the cereal costs 5% more. It would clearly be misleading to count the entire resulting higher price as inflation, because the new price reflects a higher quality (or at least different) product. Ideally, one would like to know how much of the higher price is due to the quality change, and how much of it is just a higher price. The Bureau of Labor Statistics, which is responsible for computing the Consumer Price Index, must deal with these difficulties in adjusting for quality changes.
Visit this website to view a list of Ford car prices between 1909 and 1927. Consider how these prices compare to today’s models. Is the product today of a different quality?
We can think of a new product as an extreme improvement in quality—from something that did not exist to something that does. However, the basket of goods that was fixed in the past obviously does not include new goods created since then. The basket of goods and services in the Consumer Price Index (CPI) is revised and updated over time, and so new products are gradually included. However, the process takes some time. For example, room air conditioners were widely sold in the early 1950s, but were not introduced into the basket of goods behind the Consumer Price Index until 1964. The VCR and personal computer were available in the late 1970s and widely sold by the early 1980s, but did not enter the CPI basket of goods until 1987. By 1996, there were more than 40 million cellular phone subscribers in the United States—but cell phones were not yet part of the CPI basket of goods. The parade of inventions has continued, with the CPI inevitably lagging a few years behind.
The arrival of new goods creates problems with respect to the accuracy of measuring inflation. The reason people buy new goods, presumably, is that the new goods offer better value for money than existing goods. Thus, if the price index leaves out new goods, it overlooks one of the ways in which the cost of living is improving. In addition, the price of a new good is often higher when it is first introduced and then declines over time. If the new good is not included in the CPI for some years, until its price is already lower, the CPI may miss counting this price decline altogether. Taking these arguments together, the quality/new goods bias means that the rise in the price of a fixed basket of goods over time tends to overstate the rise in a consumer’s true cost of living, because it does not account for how improvements in the quality of existing goods or the invention of new goods improves the standard of living. The following Clear It Up feature is a must-read on how statisticians comprise and calculate the CPI.
How do U.S. government statisticians measure the Consumer Price Index?
When the U.S. Bureau of Labor Statistics (BLS) calculates the Consumer Price Index, the first task is to decide on a basket of goods that is representative of the purchases of the average household. We do this by using the Consumer Expenditure Survey, a national survey of about 7,000 households, which provides detailed information on spending habits. Statisticians divide consumer expenditures into eight major groups (seen below), which in turn they divide into more than 200 individual item categories. The BLS currently uses 1982–1984 as the base period.
For each of the 200 individual expenditure items, the BLS chooses several hundred very specific examples of that item and looks at the prices of those examples. In figuring out the “breakfast cereal” item under the overall category of “foods and beverages,” the BLS picks several hundred examples of breakfast cereal. One example might be the price of a 24-oz. box of a particular brand of cereal sold at a particular store. The BLS statistically selects specific products and sizes and stores to reflect what people buy and where they shop. The basket of goods in the Consumer Price Index thus consists of about 80,000 products; that is, several hundred specific products in over 200 broad-item categories. Statisticians rotate about one-quarter of these 80,000 specific products of the sample each year, and replace them with a different set of products.
The next step is to collect data on prices. Data collectors visit or call about 23,000 stores in 87 urban areas all over the United States every month to collect prices on these 80,000 specific products. The BLS also conducts a survey of 50,000 landlords or tenants to collect information about rents.
Statisticians then calculate the Consumer Price Index by taking the 80,000 prices of individual products and combining them, using weights (see Figure) determined by the quantities of these products that people buy and allowing for factors like substitution between goods and quality improvements, into price indices for the 200 or so overall items. Then, the statisticians combine the price indices for the 200 items into an overall Consumer Price Index. According the Consumer Price Index website, there are eight categories that data collectors use:
The Eight Major Categories in the Consumer Price Index
- Food and beverages (breakfast cereal, milk, coffee, chicken, wine, full-service meals, and snacks)
- Housing (renter’s cost of housing, homeowner’s cost of housing, fuel oil, bedroom furniture)
- Apparel (men’s shirts and sweaters, women’s dresses, jewelry)
- Transportation (new vehicles, airline fares, gasoline, motor vehicle insurance)
- Medical care (prescription drugs and medical supplies, physicians’ services, eyeglasses and eye care, hospital services)
- Recreation (televisions, cable television, pets and pet products, sports equipment, admissions)
- Education and communication (college tuition, postage, telephone services, computer software and accessories)
- Other goods and services (tobacco and smoking products, haircuts and other personal services, funeral expenses)
The CPI and Core Inflation Index
Imagine if you were driving a company truck across the country- you probably would care about things like the prices of available roadside food and motel rooms as well as the truck’s operating condition. However, the manager of the firm might have different priorities. He would care mostly about the truck’s on-time performance and much less so about the food you were eating and the places you were staying. In other words, the company manager would be paying attention to the firm's production, while ignoring transitory elements that impacted you, but did not affect the company’s bottom line.
In a sense, a similar situation occurs with regard to measures of inflation. As we’ve learned, CPI measures prices as they affect everyday household spending. Economists typically calculate a core inflation index by taking the CPI and excluding volatile economic variables. In this way, economists have a better sense of the underlying trends in prices that affect the cost of living.
Examples of excluded variables include energy and food prices, which can jump around from month to month because of the weather. According to an article by Kent Bernhard, during Hurricane Katrina in 2005, a key supply point for the nation’s gasoline was nearly knocked out. Gas prices quickly shot up across the nation, in some places by up to 40 cents a gallon in one day. This was not the cause of an economic policy but rather a short-lived event until the pumps were restored in the region. In this case, the CPI that month would register the change as a cost of living event to households, but the core inflation index would remain unchanged. As a result, the Federal Reserve’s decisions on interest rates would not be influenced. Similarly, droughts can cause world-wide spikes in food prices that, if temporary, do not affect the nation’s economic capability.
As former Chairman of the Federal Reserve Ben Bernanke noted in 1999 about the core inflation index, “It provide(s) a better guide to monetary policy than the other indices, since it measures the more persistent underlying inflation rather than transitory influences on the price level.” Bernanke also noted that it helps communicate that the Federal Reserve does not need to respond to every inflationary shock since some price changes are transitory and not part of a structural change in the economy.
In sum, both the CPI and the core inflation index are important, but serve different audiences. The CPI helps households understand their overall cost of living from month to month, while the core inflation index is a preferred gauge from which to make important government policy changes.
Practical Solutions for the Substitution and the Quality/New Goods Biases
By the early 2000s, the Bureau of Labor Statistics was using alternative mathematical methods for calculating the Consumer Price Index, more complicated than just adding up the cost of a fixed basket of goods, to allow for some substitution between goods. It was also updating the basket of goods behind the CPI more frequently, so that it could include new and improved goods more rapidly. For certain products, the BLS was carrying out studies to try to measure the quality improvement. For example, with computers, an economic study can try to adjust for changes in speed, memory, screen size, and other product characteristics, and then calculate the change in price after accounting for these product changes. However, these adjustments are inevitably imperfect, and exactly how to make these adjustments is often a source of controversy among professional economists.
By the early 2000s, the substitution bias and quality/new goods bias had been somewhat reduced, so that since then the rise in the CPI probably overstates the true rise in inflation by only about 0.5% per year. Over one or a few years, this is not much. Over a period of a decade or two, even half of a percent per year compounds to a more significant amount. In addition, the CPI tracks prices from physical locations, and not at online sites like Amazon, where prices can be lower.
When measuring inflation (and other economic statistics, too), a tradeoff arises between simplicity and interpretation. If we calculate the inflation rate with a basket of goods that is fixed and unchanging, then the calculation of an inflation rate is straightforward, but the problems of substitution bias and quality/new goods bias will arise. However, when the basket of goods is allowed to shift and evolve to reflect substitution toward lower relative prices, quality improvements, and new goods, the technical details of calculating the inflation rate grow more complex.
Additional Price Indices: PPI, GDP Deflator, and More
The basket of goods behind the Consumer Price Index represents an average hypothetical U.S. household's consumption, which is to say that it does not exactly capture anyone’s personal experience. When the task is to calculate an average level of inflation, this approach works fine. What if, however, you are concerned about inflation experienced by a certain group, like the elderly, or the poor, or single-parent families with children, or Hispanic-Americans? In specific situations, a price index based on the buying power of the average consumer may not feel quite right.
This problem has a straightforward solution. If the Consumer Price Index does not serve the desired purpose, then invent another index, based on a basket of goods appropriate for the group of interest. The Bureau of Labor Statistics publishes a number of experimental price indices: some for particular groups like the elderly or the poor, some for different geographic areas, and some for certain broad categories of goods like food or housing.
The BLS also calculates several price indices that are not based on baskets of consumer goods. For example, the Producer Price Index (PPI) is based on prices paid for supplies and inputs by producers of goods and services. We can break it down into price indices for different industries, commodities, and stages of processing (like finished goods, intermediate goods, or crude materials for further processing). There is an International Price Index based on the prices of merchandise that is exported or imported. An Employment Cost Index measures wage inflation in the labor market. The GDP deflator, which the Bureau of Economic Analysis measures, is a price index that includes all the GDP components (that is, consumption plus investment plus government plus exports minus imports). Unlike the CPI, its baskets are not fixed but re-calculate what that year’s GDP would have been worth using the base-year’s prices. MIT's Billion Prices Project is a more recent alternative attempt to measure prices: economists collect data online from retailers and then put them into an index that they compare to the CPI (Source: http://bpp.mit.edu/usa/).
What’s the best measure of inflation? If one is concerned with the most accurate measure of inflation, one should use the GDP deflator as it picks up the prices of goods and services produced. However, it is not a good measure of the cost of living as it includes prices of many products not purchased by households (for example, aircraft, fire engines, factory buildings, office complexes, and bulldozers). If one wants the most accurate measure of inflation as it impacts households, one should use the CPI, as it only picks up prices of products purchased by households. That is why economists sometimes refer to the CPI as the cost-of-living index. As the Bureau of Labor Statistics states on its website: “The ‘best’ measure of inflation for a given application depends on the intended use of the data.”
Key Concepts and Summary
Measuring price levels with a fixed basket of goods will always have two problems: the substitution bias, by which a fixed basket of goods does not allow for buying more of what becomes relatively less expensive and less of what becomes relatively more expensive; and the quality/new goods bias, by which a fixed basket cannot account for improvements in quality and the advent of new goods. These problems can be reduced in degree—for example, by allowing the basket of goods to evolve over time—but we cannot totally eliminate them. The most commonly cited measure of inflation is the Consumer Price Index (CPI), which is based on a basket of goods representing what the typical consumer buys. The Core Inflation Index further breaks down the CPI by excluding volatile economic commodities. Several price indices are not based on baskets of consumer goods. The GDP deflator is based on all GDP components. The Producer Price Index is based on prices of supplies and inputs bought by producers of goods and services. An Employment Cost Index measures wage inflation in the labor market. An International Price Index is based on the prices of merchandise that is exported or imported.
Self-Check Questions
How to Measure Changes in the Cost of Living introduced a number of different price indices. Which price index would be best to use to adjust your paycheck for inflation?
Hint:
Since the CPI measures the prices of the goods and services purchased by the typical urban consumer, it measures the prices of things that people buy with their paycheck. For that reason, the CPI would be the best price index to use for this purpose.
The Consumer Price Index is subject to the substitution bias and the quality/new goods bias. Are the Producer Price Index and the GDP Deflator also subject to these biases? Why or why not?
Hint:
The PPI is subject to those biases for essentially the same reasons as the CPI is. The GDP deflator picks up prices of what is actually purchased that year, so there are no biases. That is the advantage of using the GDP deflator over the CPI.
Review Questions
Why does “substitution bias” arise if we calculate the inflation rate based on a fixed basket of goods?
Why does the “quality/new goods bias” arise if we calculate the inflation rate based on a fixed basket of goods?
Critical Thinking Question
Given the federal budget deficit in recent years, some economists have argued that by adjusting Social Security payments for inflation using the CPI, Social Security is overpaying recipients. What is their argument, and do you agree or disagree with it?
Why is the GDP deflator not an accurate measure of inflation as it impacts a household?
Imagine that the government statisticians who calculate the inflation rate have been updating the basic basket of goods once every 10 years, but now they decide to update it every five years. How will this change affect the amount of substitution bias and quality/new goods bias?
Describe a situation, either a government policy situation, an economic problem, or a private sector situation, where using the CPI to convert from nominal to real would be more appropriate than using the GDP deflator.
Describe a situation, either a government policy situation, an economic problem, or a private sector situation, where using the GDP deflator to convert from nominal to real would be more appropriate than using the CPI.
References
Bernhard, Kent. “Pump Prices Jump Across U.S. after Katrina.” NBC News, September 1, 2005. http://www.nbcnews.com/id/9146363/ns/business-local_business/t/pump-prices-jump-across-us-after-katrina/#.U00kRfk7um4.
Wynne, Mark A. “Core Inflation, A Review of Some Conceptual Issues.” Federal Reserve Bank of St. Louis. p. 209. Accessed April 14, 2014. http://research.stlouisfed.org/publications/review/08/05/part2/Wynne.pdf
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How the U.S. and Other Countries Experience Inflation
Overview
By the end of this section, you will be able to:
- Identify patterns of inflation for the United States using data from the Consumer Price Index
- Identify patterns of inflation on an international level
In the last three decades, inflation has been relatively low in the U.S. economy, with the Consumer Price Index typically rising 2% to 4% per year. Looking back over the twentieth century, there have been several periods where inflation caused the price level to rise at double-digit rates, but nothing has come close to hyperinflation.
Historical Inflation in the U.S. Economy
Figure (a) shows the level of prices in the Consumer Price Index stretching back to 1913. In this case, the base years (when the CPI is defined as 100) are set for the average level of prices that existed from 1982 to 1984. Figure (b) shows the annual percentage changes in the CPI over time, which is the inflation rate.
The first two waves of inflation are easy to characterize in historical terms: they are right after World War I and World War II. However, there are also two periods of severe negative inflation—called deflation—in the early decades of the twentieth century: one following the deep 1920-21 recession of and the other during the 1930s Great Depression of the 1930s. (Since inflation is a time when the buying power of money in terms of goods and services is reduced, deflation will be a time when the buying power of money in terms of goods and services increases.) For the period from 1900 to about 1960, the major inflations and deflations nearly balanced each other out, so the average annual rate of inflation over these years was only about 1% per year. A third wave of more severe inflation arrived in the 1970s and departed in the early 1980s.
Visit this website to use an inflation calculator and discover how prices have changed in the last 100 years.
Times of recession or depression often seem to be times when the inflation rate is lower, as in the recession of 1920–1921, the Great Depression, the recession of 1980–1982, and the Great Recession in 2008–2009. There were a few months in 2009 that were deflationary, but not at an annual rate. High levels of unemployment typically accompany recessions, and the total demand for goods falls, pulling the price level down. Conversely, the rate of inflation often, but not always, seems to start moving up when the economy is growing very strongly, like right after wartime or during the 1960s. The frameworks for macroeconomic analysis, that we developed in other chapters, will explain why recession often accompanies higher unemployment and lower inflation, while rapid economic growth often brings lower unemployment but higher inflation.
Inflation around the World
Around the rest of the world, the pattern of inflation has been very mixed; Figure shows inflation rates over the last several decades. Many industrialized countries, not just the United States, had relatively high inflation rates in the 1970s. For example, in 1975, Japan’s inflation rate was over 8% and the inflation rate for the United Kingdom was almost 25%. In the 1980s, inflation rates came down in the United States and in Europe and have largely stayed down.
Countries with controlled economies in the 1970s, like the Soviet Union and China, historically had very low rates of measured inflation—because prices were forbidden to rise by law, except for the cases where the government deemed a price increase to be due to quality improvements. However, these countries also had perpetual shortages of goods, since forbidding prices to rise acts like a price ceiling and creates a situation where quantity demanded often exceeds quantity supplied. As Russia and China made a transition toward more market-oriented economies, they also experienced outbursts of inflation, although we should regard the statistics for these economies as somewhat shakier. Inflation in China averaged about 10% per year for much of the 1980s and early 1990s, although it has dropped off since then. Russia experienced hyperinflation—an outburst of high inflation—of 2,500% per year in the early 1990s, although by 2006 Russia’s consumer price inflation had dipped below 10% per year, as Figure shows. The closest the United States has ever reached hyperinflation was during the 1860–1865 Civil War, in the Confederate states.
Many countries in Latin America experienced raging inflation during the 1980s and early 1990s, with inflation rates often well above 100% per year. In 1990, for example, both Brazil and Argentina saw inflation climb above 2000%. Certain countries in Africa experienced extremely high rates of inflation, sometimes bordering on hyperinflation, in the 1990s. Nigeria, the most populous country in Africa, had an inflation rate of 75% in 1995.
In the early 2000s, the problem of inflation appears to have diminished for most countries, at least in comparison to the worst times of recent decades. As we noted in this earlier Bring it Home feature, in recent years, the world’s worst example of hyperinflation was in Zimbabwe, where at one point the government was issuing bills with a face value of $100 trillion (in Zimbabwean dollars)—that is, the bills had $100,000,000,000,000 written on the front, but were almost worthless. In many countries, the memory of double-digit, triple-digit, and even quadruple-digit inflation is not very far in the past.
Key Concepts and Summary
In the U.S. economy, the annual inflation rate in the last two decades has typically been around 2% to 4%. The periods of highest inflation in the United States in the twentieth century occurred during the years after World Wars I and II, and in the 1970s. The period of lowest inflation—actually, with deflation—was the 1930s Great Depression.
Self-Check Question
Go to this website for the Purchasing Power Calculator at MeasuringWorth.com. How much money would it take today to purchase what one dollar would have bought in the year of your birth?
Hint:
The calculator requires you to input three numbers:
- The first year, in this case the year of your birth
- The amount of money you would want to translate in terms of its purchasing power
- The last year—now or the most recent year the calculator will accept
My birth year is 1955. The amount is $1. The year 2012 is currently the latest year the calculator will accept. The simple purchasing power calculator shows that $1 of purchases in 1955 would cost $8.57 in 2012. The website also explains how the true answer is more complicated than that shown by the simple purchasing power calculator.
Review Questions
What has been a typical range of inflation in the U.S. economy in the last decade or so?
Over the last century, during what periods was the U.S. inflation rate highest and lowest?
What is deflation?
Critical Thinking Question
Why do you think the U.S. experience with inflation over the last 50 years has been so much milder than in many other countries?
Problems
Within 1 or 2 percentage points, what has the U.S. inflation rate been during the last 20 years? Draw a graph to show the data.
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The Confusion Over Inflation
Overview
By the end of this section, you will be able to:
- Explain how inflation can cause redistributions of purchasing power
- Identify ways inflation can blur the perception of supply and demand
- Explain the economic benefits and challenges of inflation
Economists usually oppose high inflation, but they oppose it in a milder way than many non-economists. Robert Shiller, one of 2013’s Nobel Prize winners in economics, carried out several surveys during the 1990s about attitudes toward inflation. One of his questions asked, “Do you agree that preventing high inflation is an important national priority, as important as preventing drug abuse or preventing deterioration in the quality of our schools?” Answers were on a scale of 1–5, where 1 meant “Fully agree” and 5 meant “Completely disagree.” For the U.S. population as a whole, 52% answered “Fully agree” that preventing high inflation was a highly important national priority and just 4% said “Completely disagree.” However, among professional economists, only 18% answered “Fully agree,” while the same percentage of 18% answered “Completely disagree.”
The Land of Funny Money
What are the economic problems caused by inflation, and why do economists often regard them with less concern than the general public? Consider a very short story: “The Land of Funny Money.”
One morning, everyone in the Land of Funny Money awakened to find that everything denominated in money had increased by 20%. The change was completely unexpected. Every price in every store was 20% higher. Paychecks were 20% higher. Interest rates were 20 % higher. The amount of money, everywhere from wallets to savings accounts, was 20% larger. This overnight inflation of prices made newspaper headlines everywhere in the Land of Funny Money. However, the headlines quickly disappeared, as people realized that in terms of what they could actually buy with their incomes, this inflation had no economic impact. Everyone’s pay could still buy exactly the same set of goods as it did before. Everyone’s savings were still sufficient to buy exactly the same car, vacation, or retirement that they could have bought before. Equal levels of inflation in all wages and prices ended up not mattering much at all.
When the people in Robert Shiller’s surveys explained their concern about inflation, one typical reason was that they feared that as prices rose, they would not be able to afford to buy as much. In other words, people were worried because they did not live in a place like the Land of Funny Money, where all prices and wages rose simultaneously. Instead, people live here on Planet Earth, where prices might rise while wages do not rise at all, or where wages rise more slowly than prices.
Economists note that over most periods, the inflation level in prices is roughly similar to the inflation level in wages, and so they reason that, on average, over time, people’s economic status is not greatly changed by inflation. If all prices, wages, and interest rates adjusted automatically and immediately with inflation, as in the Land of Funny Money, then no one’s purchasing power, profits, or real loan payments would change. However, if other economic variables do not move exactly in sync with inflation, or if they adjust for inflation only after a time lag, then inflation can cause three types of problems: unintended redistributions of purchasing power, blurred price signals, and difficulties in long-term planning.
Unintended Redistributions of Purchasing Power
Inflation can cause redistributions of purchasing power that hurt some and help others. People who are hurt by inflation include those who are holding considerable cash, whether it is in a safe deposit box or in a cardboard box under the bed. When inflation happens, the buying power of cash diminishes. However, cash is only an example of a more general problem: anyone who has financial assets invested in a way that the nominal return does not keep up with inflation will tend to suffer from inflation. For example, if a person has money in a bank account that pays 4% interest, but inflation rises to 5%, then the real rate of return for the money invested in that bank account is negative 1%.
The problem of a good-looking nominal interest rate transforming into an ugly-looking real interest rate can be worsened by taxes. The U.S. income tax is charged on the nominal interest received in dollar terms, without an adjustment for inflation. Thus, the government taxes a person who invests $10,000 and receives a 5% nominal rate of interest on the $500 received—no matter whether the inflation rate is 0%, 5%, or 10%. If inflation is 0%, then the real interest rate is 5% and all $500 is a gain in buying power. However, if inflation is 5%, then the real interest rate is zero and the person had no real gain—but owes income tax on the nominal gain anyway. If inflation is 10%, then the real interest rate is negative 5% and the person is actually falling behind in buying power, but would still owe taxes on the $500 in nominal gains.
Inflation can cause unintended redistributions for wage earners, too. Wages do typically creep up with inflation over time, eventually. The last row of at the start of this chapter showed that the average hourly wage in manufacturing in the U.S. economy increased from $3.23 in 1970 to $20.65 in 2017, which is an increase by a factor of more than six. Over that time period, the Consumer Price Index increased by an almost identical amount. However, increases in wages may lag behind inflation for a year or two, since wage adjustments are often somewhat sticky and occur only once or twice a year. Moreover, the extent to which wages keep up with inflation creates insecurity for workers and may involve painful, prolonged conflicts between employers and employees. If the government adjusts minimum wage for inflation only infrequently, minimum wage workers are losing purchasing power from their nominal wages, as Figure shows.
One sizable group of people has often received a large share of their income in a form that does not increase over time: retirees who receive a private company pension. Most pensions have traditionally been set as a fixed nominal dollar amount per year at retirement. For this reason, economists call pensions “defined benefits” plans. Even if inflation is low, the combination of inflation and a fixed income can create a substantial problem over time. A person who retires on a fixed income at age 65 will find that losing just 1% to 2% of buying power per year to inflation compounds to a considerable loss of buying power after a decade or two.
Fortunately, pensions and other defined benefits retirement plans are increasingly rare, replaced instead by “defined contribution” plans, such as 401(k)s and 403(b)s. In these plans, the employer contributes a fixed amount to the worker’s retirement account on a regular basis (usually every pay check). The employee often contributes as well. The worker invests these funds in a wide range of investment vehicles. These plans are tax deferred, and they are portable so that if the individual takes a job with a different employer, their 401(k) comes with them. To the extent that the investments made generate real rates of return, retirees do not suffer from the inflation costs of traditional pensioners.
However, ordinary people can sometimes benefit from the unintended redistributions of inflation. Consider someone who borrows $10,000 to buy a car at a fixed interest rate of 9%. If inflation is 3% at the time the loan is made, then he or she must repay the loan at a real interest rate of 6%. However, if inflation rises to 9%, then the real interest rate on the loan is zero. In this case, the borrower’s benefit from inflation is the lender’s loss. A borrower paying a fixed interest rate, who benefits from inflation, is just the flip side of an investor receiving a fixed interest rate, who suffers from inflation. The lesson is that when interest rates are fixed, rises in the rate of inflation tend to penalize suppliers of financial capital, who receive repayment in dollars that are worth less because of inflation, while demanders of financial capital end up better off, because they can repay their loans in dollars that are worth less than originally expected.
The unintended redistributions of buying power that inflation causes may have a broader effect on society. America’s widespread acceptance of market forces rests on a perception that people’s actions have a reasonable connection to market outcomes. When inflation causes a retiree who built up a pension or invested at a fixed interest rate to suffer, however, while someone who borrowed at a fixed interest rate benefits from inflation, it is hard to believe that this outcome was deserved in any way. Similarly, when homeowners benefit from inflation because the price of their homes rises, while renters suffer because they are paying higher rent, it is hard to see any useful incentive effects. One of the reasons that the general public dislikes inflation is a sense that it makes economic rewards and penalties more arbitrary—and therefore likely to be perceived as unfair – even dangerous, as the next Clear It Up feature shows.
Is there a connection between German hyperinflation and Hitler’s rise to power?
Germany suffered an intense hyperinflation of its currency, the Mark, in the years after World War I, when the Weimar Republic in Germany resorted to printing money to pay its bills and the onset of the Great Depression created the social turmoil that Adolf Hitler was able to take advantage of in his rise to power. Shiller described the connection this way in a National Bureau of Economic Research 1996 Working Paper:
A fact that is probably little known to young people today, even in Germany, is that the final collapse of the Mark in 1923, the time when the Mark’s inflation reached astronomical levels (inflation of 35,974.9% in November 1923 alone, for an annual rate that month of 4.69 × 1028%), came in the same month as did Hitler’s Beer Hall Putsch, his Nazi Party’s armed attempt to overthrow the German government. This failed putsch resulted in Hitler’s imprisonment, at which time he wrote his book Mein Kampf, setting forth an inspirational plan for Germany’s future, suggesting plans for world domination. . .
. . . Most people in Germany today probably do not clearly remember these events; this lack of attention to it may be because its memory is blurred by the more dramatic events that succeeded it (the Nazi seizure of power and World War II). However, to someone living through these historical events in sequence . . . [the putsch] may have been remembered as vivid evidence of the potential effects of inflation.
Blurred Price Signals
Prices are the messengers in a market economy, conveying information about conditions of demand and supply. Inflation blurs those price messages. Inflation means that we perceive price signals more vaguely, like a radio program received with considerable static. If the static becomes severe, it is hard to tell what is happening.
In Israel, when inflation accelerated to an annual rate of 500% in 1985, some stores stopped posting prices directly on items, since they would have had to put new labels on the items or shelves every few days to reflect inflation. Instead, a shopper just took items from a shelf and went up to the checkout register to find out the price for that day. Obviously, this situation makes comparing prices and shopping for the best deal rather difficult. When the levels and changes of prices become uncertain, businesses and individuals find it harder to react to economic signals. In a world where inflation is at a high rate, but bouncing up and down to some extent, does a higher price of a good mean that inflation has risen, or that supply of that good has decreased, or that demand for that good has increased? Should a buyer of the good take the higher prices as an economic hint to start substituting other products—or have the prices of the substitutes risen by an equal amount? Should a seller of the good take a higher price as a reason to increase production—or is the higher price only a sign of a general inflation in which the prices of all inputs to production are rising as well? The true story will presumably become clear over time, but at a given moment, who can say?
High and variable inflation means that the incentives in the economy to adjust in response to changes in prices are weaker. Markets will adjust toward their equilibrium prices and quantities more erratically and slowly, and many individual markets will experience a greater chance of surpluses and shortages.
Problems of Long-Term Planning
Inflation can make long-term planning difficult. In discussing unintended redistributions, we considered the case of someone trying to plan for retirement with a pension that is fixed in nominal terms and a high rate of inflation. Similar problems arise for all people trying to save for retirement, because they must consider what their money will really buy several decades in the future when we cannot know the rate of future inflation.
Inflation, especially at moderate or high levels, will pose substantial planning problems for businesses, too. A firm can make money from inflation—for example, by paying bills and wages as late as possible so that it can pay in inflated dollars, while collecting revenues as soon as possible. A firm can also suffer losses from inflation, as in the case of a retail business that gets stuck holding too much cash, only to see inflation eroding the value of that cash. However, when a business spends its time focusing on how to profit by inflation, or at least how to avoid suffering from it, an inevitable tradeoff strikes: less time is spent on improving products and services or on figuring out how to make existing products and services more cheaply. An economy with high inflation rewards businesses that have found clever ways of profiting from inflation, which are not necessarily the businesses that excel at productivity, innovation, or quality of service.
In the short term, low or moderate levels of inflation may not pose an overwhelming difficulty for business planning, because costs of doing business and sales revenues may rise at similar rates. If, however, inflation varies substantially over the short or medium term, then it may make sense for businesses to stick to shorter-term strategies. The evidence as to whether relatively low rates of inflation reduce productivity is controversial among economists. There is some evidence that if inflation can be held to moderate levels of less than 3% per year, it need not prevent a nation’s real economy from growing at a healthy pace. For some countries that have experienced hyperinflation of several thousand percent per year, an annual inflation rate of 20–30% may feel basically the same as zero. However, several economists have pointed to the suggestive fact that when U.S. inflation heated up in the early 1970s—to 10%—U.S. growth in productivity slowed down, and when inflation slowed down in the 1980s, productivity edged up again not long thereafter, as Figure shows.
Any Benefits of Inflation?
Although the economic effects of inflation are primarily negative, two countervailing points are worth noting. First, the impact of inflation will differ considerably according to whether it is creeping up slowly at 0% to 2% per year, galloping along at 10% to 20% per year, or racing to the point of hyperinflation at, say, 40% per month. Hyperinflation can rip an economy and a society apart. An annual inflation rate of 2%, 3%, or 4%, however, is a long way from a national crisis. Low inflation is also better than deflation which occurs with severe recessions.
Second, economists sometimes argue that moderate inflation may help the economy by making wages in labor markets more flexible. The discussion in Unemployment pointed out that wages tend to be sticky in their downward movements and that unemployment can result. A little inflation could nibble away at real wages, and thus help real wages to decline if necessary. In this way, even if a moderate or high rate of inflation may act as sand in the gears of the economy, perhaps a low rate of inflation serves as oil for the gears of the labor market. This argument is controversial. A full analysis would have to account for all the effects of inflation. It does, however, offer another reason to believe that, all things considered, very low rates of inflation may not be especially harmful.
Key Concepts and Summary
Unexpected inflation will tend to hurt those whose money received, in terms of wages and interest payments, does not rise with inflation. In contrast, inflation can help those who owe money that they can pay in less valuable, inflated dollars. Low rates of inflation have relatively little economic impact over the short term. Over the medium and the long term, even low rates of inflation can complicate future planning. High rates of inflation can muddle price signals in the short term and prevent market forces from operating efficiently, and can vastly complicate long-term savings and investment decisions.
Self-Check Question
If inflation rises unexpectedly by 5%, would a state government that had recently borrowed money to pay for a new highway benefit or lose?
Hint:
The state government would benefit because it would repay the loan in less valuable dollars than it borrowed. Plus, tax revenues for the state government would increase because of the inflation.
Review Question
Identify several parties likely to be helped and hurt by inflation.
Critical Thinking Questions
If, over time, wages and salaries on average rise at least as fast as inflation, why do people worry about how inflation affects incomes?
Who in an economy is the big winner from inflation?
References
Shiller, Robert. “Why Do People Dislike Inflation?” NBER Working Paper Series, National Bureau of Economic Research, p. 52. 1996.
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Indexing and Its Limitations
Overview
By the end of this section, you will be able to:
- Explain the relationship between indexing and inflation
- Identify three ways the government can control inflation through macroeconomic policy
When a price, wage, or interest rate is adjusted automatically with inflation, economists use the term indexed. An indexed payment increases according to the index number that measures inflation. Those in private markets and government programs observe a wide range of indexing arrangements. Since the negative effects of inflation depend in large part on having inflation unexpectedly affect one part of the economy but not another—say, increasing the prices that people pay but not the wages that workers receive—indexing will take some of the sting out of inflation.
Indexing in Private Markets
In the 1970s and 1980s, labor unions commonly negotiated wage contracts that had cost-of-living adjustments (COLAs) which guaranteed that their wages would keep up with inflation. These contracts were sometimes written as, for example, COLA plus 3%. Thus, if inflation was 5%, the wage increase would automatically be 8%, but if inflation rose to 9%, the wage increase would automatically be 12%. COLAs are a form of indexing applied to wages.
Loans often have built-in inflation adjustments, too, so that if the inflation rate rises by two percentage points, then the interest rate that a financial institution charges on the loan rises by two percentage points as well. An adjustable-rate mortgage (ARM) is a type of loan that one can use to purchase a home in which the interest rate varies with the rate of inflation. Often, a borrower will be able receive a lower interest rate if borrowing with an ARM, compared to a fixed-rate loan. The reason is that with an ARM, the lender is protected against the risk that higher inflation will reduce the real loan payments, and so the risk premium part of the interest rate can be correspondingly lower.
A number of ongoing or long-term business contracts also have provisions that prices will adjust automatically according to inflation. Sellers like such contracts because they are not locked into a low nominal selling price if inflation turns out higher than expected. Buyers like such contracts because they are not locked into a high buying price if inflation turns out to be lower than expected. A contract with automatic adjustments for inflation in effect agrees on a real price for the borrower to pay, rather than a nominal price.
Indexing in Government Programs
Many government programs are indexed to inflation. The U.S. income tax code is designed so that as a person’s income rises above certain levels, the tax rate on the marginal income earned rises as well. That is what the expression “move into a higher tax bracket” means. For example, according to the basic tax tables from the Internal Revenue Service, in 2017 a single person owed 10% of all taxable income from $0 to $9,325; 15% of all income from $9,326 to $37,950; 25% of all taxable income from $37,951 to $91,900; 28% of all taxable income from $91,901 to $191,650; 33% of all taxable income from $191,651 to $416,700; 35% of all taxable income from $416,701 to $418,400; and 39.6% of all income from $418,401 and above.
Because of the many complex provisions in the rest of the tax code, it is difficult to determine exactly the taxes an individual owes the government based on these numbers, but the numbers illustrate the basic theme that tax rates rise as the marginal dollar of income rises. Until the late 1970s, if nominal wages increased along with inflation, people were moved into higher tax brackets and owed a higher proportion of their income in taxes, even though their real income had not risen. In 1981, the government eliminated this “bracket creep”. Now, the income levels where higher tax rates kick in are indexed to rise automatically with inflation.
The Social Security program offers two examples of indexing. Since the passage of the Social Security Indexing Act of 1972, the level of Social Security benefits increases each year along with the Consumer Price Index. Also, Social Security is funded by payroll taxes, which the government imposes on the income earned up to a certain amount—$117,000 in 2014. The government adjusts this level of income upward each year according to the rate of inflation, so that an indexed increase in the Social Security tax base accompanies the indexed rise in the benefit level.
As yet another example of a government program affected by indexing, in 1996 the U.S., government began offering indexed bonds. Bonds are means by which the U.S. government (and many private-sector companies as well) borrows money; that is, investors buy the bonds, and then the government repays the money with interest. Traditionally, government bonds have paid a fixed rate of interest. This policy gave a government that had borrowed an incentive to encourage inflation, because it could then repay its past borrowing in inflated dollars at a lower real interest rate. However, indexed bonds promise to pay a certain real rate of interest above whatever inflation rate occurs. In the case of a retiree trying to plan for the long term and worried about the risk of inflation, for example, indexed bonds that guarantee a rate of return higher than inflation—no matter the level of inflation—can be a very comforting investment.
Might Indexing Reduce Concern over Inflation?
Indexing may seem like an obviously useful step. After all, when individuals, firms, and government programs are indexed against inflation, then people can worry less about arbitrary redistributions and other effects of inflation.
However, some of the fiercest opponents of inflation express grave concern about indexing. They point out that indexing is always partial. Not every employer will provide COLAs for workers. Not all companies can assume that costs and revenues will rise in lockstep with the general rates of inflation. Not all interest rates for borrowers and savers will change to match inflation exactly. However, as partial inflation indexing spreads, the political opposition to inflation may diminish. After all, older people whose Social Security benefits are protected against inflation, or banks that have loaned their money with adjustable-rate loans, no longer have as much reason to care whether inflation heats up. In a world where some people are indexed against inflation and some are not, financially savvy businesses and investors may seek out ways to be protected against inflation, while the financially unsophisticated and small businesses may suffer from it most.
A Preview of Policy Discussions of Inflation
This chapter has focused on how economists measure inflation, historical experience with inflation, how to adjust nominal variables into real ones, how inflation affects the economy, and how indexing works. We have barely hinted at the causes of inflation, and we have not addressed government policies to deal with inflation. We will examine these issues in depth in other chapters. However, it is useful to offer a preview here.
We can sum up the cause of inflation in one phrase: Too many dollars chasing too few goods. The great surges of inflation early in the twentieth century came after wars, which are a time when government spending is very high, but consumers have little to buy, because production is going to the war effort. Governments also commonly impose price controls during wartime. After the war, the price controls end and pent-up buying power surges forth, driving up inflation. Otherwise, if too few dollars are chasing too many goods, then inflation will decline or even turn into deflation. Therefore, we typically associate slowdowns in economic activity, as in major recessions and the Great Depression, with a reduction in inflation or even outright deflation.
The policy implications are clear. If we are to avoid inflation, the amount of purchasing power in the economy must grow at roughly the same rate as the production of goods. Macroeconomic policies that the government can use to affect the amount of purchasing power—through taxes, spending, and regulation of interest rates and credit—can thus cause inflation to rise or reduce inflation to lower levels.
A $550 Million Loaf of Bread?
As we will learn in Money and Banking, the existence of money provides enormous benefits to an economy. In a real sense, money is the lubrication that enhances the workings of markets. Money makes transactions easier. It allows people to find employment producing one product, then use the money earned to purchase the other products they need to live. However, too much money in circulation can lead to inflation. Extreme cases of governments recklessly printing money lead to hyperinflation. Inflation reduces the value of money. Hyperinflation, because money loses value so quickly, ultimately results in people no longer using money. The economy reverts to barter, or it adopts another country’s more stable currency, like U.S. dollars. In the meantime, the economy literally falls apart as people leave jobs and fend for themselves because it is not worth the time to work for money that will be worthless in a few days.
Only national governments have the power to cause hyperinflation. Hyperinflation typically happens when government faces extraordinary demands for spending, which it cannot finance by taxes or borrowing. The only option is to print money—more and more of it. With more money in circulation chasing the same amount (or even fewer) goods and services, the only result is increasingly higher prices until the economy and/or the government collapses. This is why economists are generally wary of letting inflation spiral out of control.
Key Concepts and Summary
A payment is indexed if it is automatically adjusted for inflation. Examples of indexing in the private sector include wage contracts with cost-of-living adjustments (COLAs) and loan agreements like adjustable-rate mortgages (ARMs). Examples of indexing in the public sector include tax brackets and Social Security payments.
Self-Check Questions
How should an increase in inflation affect the interest rate on an adjustable-rate mortgage?
Hint:
Higher inflation reduces real interest rates on fixed rate mortgages. Because ARMs can be adjusted, higher inflation leads to higher interest rates on ARMs.
A fixed-rate mortgage has the same interest rate over the life of the loan, whether the mortgage is for 15 or 30 years. By contrast, an adjustable-rate mortgage changes with market interest rates over the life of the mortgage. If inflation falls unexpectedly by 3%, what would likely happen to a homeowner with an adjustable-rate mortgage?
Hint:
Because the mortgage has an adjustable rate, the rate should fall by 3%, the same as inflation, to keep the real interest rate the same.
Review Questions
What is indexing?
Name several forms of indexing in the private and public sector.
Critical Thinking Questions
If a government gains from unexpected inflation when it borrows, why would it choose to offer indexed bonds?
Do you think perfect indexing is possible? Why or why not?
Problems
If inflation rises unexpectedly by 5%, indicate for each of the following whether the economic actor is helped, hurt, or unaffected:
- A union member with a COLA wage contract
- Someone with a large stash of cash in a safe deposit box
- A bank lending money at a fixed rate of interest
- A person who is not due to receive a pay raise for another 11 months
Rosalie the Retiree knows that when she retires in 16 years, her company will give her a one-time payment of $20,000. However, if the inflation rate is 6% per year, how much buying power will that $20,000 have when measured in today’s dollars? Hint: Start by calculating the rise in the price level over the 16 years.
References
Wines, Michael. “How Bad is Inflation in Zimbabwe?” The New York Times, May 2, 2006. http://www.nytimes.com/2006/05/02/world/africa/02zimbabwe.html?pagewanted=all&_r=0.
Hanke, Steve H. “R.I.P. Zimbabwe Dollar.” CATO Institute. Accessed December 31, 2013. http://www.cato.org/zimbabwe.
Massachusetts Institute of Technology. 2015. "Billion Prices Project." Accessed March 4, 2015. http://bpp.mit.edu/usa/.
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https://oercommons.org/courseware/lesson/28852/overview
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Introduction to Exchange Rates and International Capital Flows
Is a Stronger Dollar Good for the U.S. Economy?
From 2002 to 2008, the U.S. dollar lost more than a quarter of its value in foreign currency markets. On January 1, 2002, one dollar was worth 1.11 euros. On April 24, 2008 it hit its lowest point with a dollar being worth 0.64 euros. During this period, the trade deficit between the United States and the European Union grew from a yearly total of approximately –85.7 billion dollars in 2002 to 95.8 billion dollars in 2008. Was this a good thing or a bad thing for the U.S. economy?
We live in a global world. U.S. consumers buy trillions of dollars worth of imported goods and services each year, not just from the European Union, but from all over the world. U.S. businesses sell trillions of dollars’ worth of exports. U.S. citizens, businesses, and governments invest trillions of dollars abroad every year. Foreign investors, businesses, and governments invest trillions of dollars in the United States each year. Indeed, foreigners are a major buyer of U.S. federal debt.
Many people feel that a weaker dollar is bad for America, that it’s an indication of a weak economy, but is it? This chapter will help answer that question.
Introduction to Exchange Rates and International Capital Flows
In this chapter, you will learn about:
- How the Foreign Exchange Market Works
- Demand and Supply Shifts in Foreign Exchange Markets
- Macroeconomic Effects of Exchange Rates
- Exchange Rate Policies
The world has over 150 different currencies, from the Afghanistan afghani and the Albanian lek all the way through the alphabet to the Zambian kwacha and the Zimbabwean dollar. For international economic transactions, households or firms will wish to exchange one currency for another. Perhaps the need for exchanging currencies will come from a German firm that exports products to Russia, but then wishes to exchange the Russian rubles it has earned for euros, so that the firm can pay its workers and suppliers in Germany. Perhaps it will be a South African firm that wishes to purchase a mining operation in Angola, but to make the purchase it must convert South African rand to Angolan kwanza. Perhaps it will be an American tourist visiting China, who wishes to convert U.S. dollars to Chinese yuan to pay the hotel bill.
Exchange rates can sometimes change very swiftly. For example, in the United Kingdom the pound was worth about $1.50 just before the nation voted to leave the European Union (also known as the Brexit vote), but fell to $1.37 just after the vote and continued falling to reach 30-year lows a few months later. For firms engaged in international buying, selling, lending, and borrowing, these swings in exchange rates can have an enormous effect on profits.
This chapter discusses the international dimension of money, which involves conversions from one currency to another at an exchange rate. An exchange rate is nothing more than a price—that is, the price of one currency in terms of another currency—and so we can analyze it with the tools of supply and demand. The first module of this chapter begins with an overview of foreign exchange markets: their size, their main participants, and the vocabulary for discussing movements of exchange rates. The following module uses demand and supply graphs to analyze some of the main factors that cause shifts in exchange rates. A final module then brings the central bank and monetary policy back into the picture. Each country must decide whether to allow the market to determine its exchange rate, or have the central bank intervene. All the choices for exchange rate policy involve distinctive tradeoffs and risks.
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https://oercommons.org/courseware/lesson/28853/overview
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How the Foreign Exchange Market Works
Overview
By the end of this section, you will be able to:
- Define "foreign exchange market"
- Describe different types of investments like foreign direct investments (FDI), portfolio investments, and hedging
- Explain how appreciating or depreciating currency affects exchange rates
- Identify who benefits from a stronger currency and benefits from a weaker currency
Most countries have different currencies, but not all. Sometimes small economies use an economically larger neighbor's currency. For example, Ecuador, El Salvador, and Panama have decided to dollarize—that is, to use the U.S. dollar as their currency. Sometimes nations share a common currency. A large-scale example of a common currency is the decision by 17 European nations—including some very large economies such as France, Germany, and Italy—to replace their former currencies with the euro. With these exceptions, most of the international economy takes place in a situation of multiple national currencies in which both people and firms need to convert from one currency to another when selling, buying, hiring, borrowing, traveling, or investing across national borders. We call the market in which people or firms use one currency to purchase another currency the foreign exchange market.
You have encountered the basic concept of exchange rates in earlier chapters. In The International Trade and Capital Flows, for example, we discussed how economists use exchange rates to compare GDP statistics from countries where they measure GDP in different currencies. These earlier examples, however, took the actual exchange rate as given, as if it were a fact of nature. In reality, the exchange rate is a price—the price of one currency expressed in terms of units of another currency. The key framework for analyzing prices, whether in this course, any other economics course, in public policy, or business examples, is the operation of supply and demand in markets.
Visit this website for an exchange rate calculator.
The Extraordinary Size of the Foreign Exchange Markets
The quantities traded in foreign exchange markets are breathtaking. A 2013 Bank of International Settlements survey found that $5.3 trillion per day was traded on foreign exchange markets, which makes the foreign exchange market the largest market in the world economy. In contrast, 2013 U.S. real GDP was $15.8 trillion per year.
Table shows the currencies most commonly traded on foreign exchange markets. The U.S. dollar dominates the foreign exchange market, followed by the euro, the British pound, the Australian dollar, and the Japanese yen.
| Currency | % Daily Share |
|---|---|
| U.S. dollar | 87.6% |
| Euro | 31.3% |
| Japanese yen | 21.6% |
| British pound | 12.8% |
| Australian dollar | 6.9% |
| Canadian dollar | 5.1% |
| Swiss franc | 4.8% |
| Chinese yuan | 2.6% |
Demanders and Suppliers of Currency in Foreign Exchange Markets
In foreign exchange markets, demand and supply become closely interrelated, because a person or firm who demands one currency must at the same time supply another currency—and vice versa. To get a sense of this, it is useful to consider four groups of people or firms who participate in the market: (1) firms that are involved in international trade of goods and services; (2) tourists visiting other countries; (3) international investors buying ownership (or part-ownership) of a foreign firm; (4) international investors making financial investments that do not involve ownership. Let’s consider these categories in turn.
Firms that buy and sell on international markets find that their costs for workers, suppliers, and investors are measured in the currency of the nation where their production occurs, but their revenues from sales are measured in the currency of the different nation where their sales happened. Thus, a Chinese firm exporting abroad will earn some other currency—say, U.S. dollars—but will need Chinese yuan to pay the workers, suppliers, and investors who are based in China. In the foreign exchange markets, this firm will be a supplier of U.S. dollars and a demander of Chinese yuan.
International tourists will supply their home currency to receive the currency of the country they are visiting. For example, an American tourist who is visiting China will supply U.S. dollars into the foreign exchange market and demand Chinese yuan.
We often divide financial investments that cross international boundaries, and require exchanging currency into two categories. Foreign direct investment (FDI) refers to purchasing a firm (at least ten percent) in another country or starting up a new enterprise in a foreign country For example, in 2008 the Belgian beer-brewing company InBev bought the U.S. beer-maker Anheuser-Busch for $52 billion. To make this purchase, InBev would have to supply euros (the currency of Belgium) to the foreign exchange market and demand U.S. dollars.
The other kind of international financial investment, portfolio investment, involves a purely financial investment that does not entail any management responsibility. An example would be a U.S. financial investor who purchased U.K. government bonds, or deposited money in a British bank. To make such investments, the American investor would supply U.S. dollars in the foreign exchange market and demand British pounds.
Business people often link portfolio investment to expectations about how exchange rates will shift. Look at a U.S. financial investor who is considering purchasing U.K. issued bonds. For simplicity, ignore any bond interest payment (which will be small in the short run anyway) and focus on exchange rates. Say that a British pound is currently worth $1.50 in U.S. currency. However, the investor believes that in a month, the British pound will be worth $1.60 in U.S. currency. Thus, as Figure (a) shows, this investor would change $24,000 for 16,000 British pounds. In a month, if the pound is worth $1.60, then the portfolio investor can trade back to U.S. dollars at the new exchange rate, and have $25,600—a nice profit. A portfolio investor who believes that the foreign exchange rate for the pound will work in the opposite direction can also invest accordingly. Say that an investor expects that the pound, now worth $1.50 in U.S. currency, will decline to $1.40. Then, as Figure (b) shows, that investor could start off with £20,000 in British currency (borrowing the money if necessary), convert it to $30,000 in U.S. currency, wait a month, and then convert back to approximately £21,429 in British currency—again making a nice profit. Of course, this kind of investing comes without guarantees, and an investor will suffer losses if the exchange rates do not move as predicted.
Many portfolio investment decisions are not as simple as betting that the currency's value will change in one direction or the other. Instead, they involve firms trying to protect themselves from movements in exchange rates. Imagine you are running a U.S. firm that is exporting to France. You have signed a contract to deliver certain products and will receive 1 million euros a year from now. However, you do not know how much this contract will be worth in U.S. dollars, because the dollar/euro exchange rate can fluctuate in the next year. Let’s say you want to know for sure what the contract will be worth, and not take a risk that the euro will be worth less in U.S. dollars than it currently is. You can hedge, which means using a financial transaction to protect yourself against a risk from one of your investments (in this case, currency risk from the contract). Specifically, you can sign a financial contract and pay a fee that guarantees you a certain exchange rate one year from now—regardless of what the market exchange rate is at that time. Now, it is possible that the euro will be worth more in dollars a year from now, so your hedging contract will be unnecessary, and you will have paid a fee for nothing. However, if the value of the euro in dollars declines, then you are protected by the hedge. When parties wish to enter financial contracts like hedging, they normally rely on a financial institution or brokerage company to handle the hedging. These companies either take a fee or create a spread in the exchange rate in order to earn money through the service they provide.
Both foreign direct investment and portfolio investment involve an investor who supplies domestic currency and demands a foreign currency. With portfolio investment, the client purchases less than ten percent of a company. As such, business players often get involved with portfolio investment with a short term focus. With foreign direct investment the investor purchases more than ten percent of a company and the investor typically assumes some managerial responsibility. Thus, foreign direct investment tends to have a more long-run focus. As a practical matter, an investor can withdraw portfolio investments from a country much more quickly than foreign direct investments. A U.S. portfolio investor who wants to buy or sell U.K. government bonds can do so with a phone call or a few computer keyboard clicks. However, a U.S. firm that wants to buy or sell a company, such as one that manufactures automobile parts in the United Kingdom, will find that planning and carrying out the transaction takes a few weeks, even months. Table summarizes the main categories of currency demanders and suppliers.
| Demand for the U.S. Dollar Comes from… | Supply of the U.S. Dollar Comes from… |
|---|---|
| A U.S. exporting firm that earned foreign currency and is trying to pay U.S.-based expenses | A foreign firm that has sold imported goods in the United States, earned U.S. dollars, and is trying to pay expenses incurred in its home country |
| Foreign tourists visiting the United States | U.S. tourists leaving to visit other countries |
| Foreign investors who wish to make direct investments in the U.S. economy | U.S. investors who want to make foreign direct investments in other countries |
| Foreign investors who wish to make portfolio investments in the U.S. economy | U.S. investors who want to make portfolio investments in other countries |
Participants in the Exchange Rate Market
The foreign exchange market does not involve the ultimate suppliers and demanders of foreign exchange literally seeking each other. If Martina decides to leave her home in Venezuela and take a trip in the United States, she does not need to find a U.S. citizen who is planning to take a vacation in Venezuela and arrange a person-to-person currency trade. Instead, the foreign exchange market works through financial institutions, and it operates on several levels.
Most people and firms who are exchanging a substantial quantity of currency go to a bank, and most banks provide foreign exchange as a service to customers. These banks (and a few other firms), known as dealers, then trade the foreign exchange. This is called the interbank market.
In the world economy, roughly 2,000 firms are foreign exchange dealers. The U.S. economy has less than 100 foreign exchange dealers, but the largest 12 or so dealers carry out more than half the total transactions. The foreign exchange market has no central location, but the major dealers keep a close watch on each other at all times.
The foreign exchange market is huge not because of the demands of tourists, firms, or even foreign direct investment, but instead because of portfolio investment and the actions of interlocking foreign exchange dealers. International tourism is a very large industry, involving about $1 trillion per year. Global exports are about 23% of global GDP; which is about $18 trillion per year. Foreign direct investment totaled about $1.5 trillion in the end of 2013. These quantities are dwarfed, however, by the $5.3 trillion per day traded in foreign exchange markets. Most transactions in the foreign exchange market are for portfolio investment—relatively short-term movements of financial capital between currencies—and because of the large foreign exchange dealers' actions as they constantly buy and sell with each other.
Strengthening and Weakening Currency
When the prices of most goods and services change, the price "rises or "falls". For exchange rates, the terminology is different. When the exchange rate for a currency rises, so that the currency exchanges for more of other currencies, we refer to it as appreciating or “strengthening.” When the exchange rate for a currency falls, so that a currency trades for less of other currencies, we refer to it as depreciating or “weakening.”
To illustrate the use of these terms, consider the exchange rate between the U.S. dollar and the Canadian dollar since 1980, in Figure (a). The vertical axis in Figure (a) shows the price of $1 in U.S. currency, measured in terms of Canadian currency. Clearly, exchange rates can move up and down substantially. A U.S. dollar traded for $1.17 Canadian in 1980. The U.S. dollar appreciated or strengthened to $1.39 Canadian in 1986, depreciated or weakened to $1.15 Canadian in 1991, and then appreciated or strengthened to $1.60 Canadian by early in 2002, fell to roughly $1.20 Canadian in 2009, and then had a sharp spike up and decline in 2009 and 2010. In May of 2017, the U.S. dollar stood at $1.36 Canadian. The units in which we measure exchange rates can be confusing, because we measure the exchange rate of the U.S. dollar exchange using a different currency—the Canadian dollar. However, exchange rates always measure the price of one unit of currency by using a different currency.
In looking at the exchange rate between two currencies, the appreciation or strengthening of one currency must mean the depreciation or weakening of the other. Figure (b) shows the exchange rate for the Canadian dollar, measured in terms of U.S. dollars. The exchange rate of the U.S. dollar measured in Canadian dollars, in Figure (a), is a perfect mirror image with the Canadian dollar exchange rate measured in U.S. dollars, in Figure (b). A fall in the Canada $/U.S. $ ratio means a rise in the U.S. $/Canada $ ratio, and vice versa.
With the price of a typical good or service, it is clear that higher prices benefit sellers and hurt buyers, while lower prices benefit buyers and hurt sellers. In the case of exchange rates, where the buyers and sellers are not always intuitively obvious, it is useful to trace how a stronger or weaker currency will affect different market participants. Consider, for example, the impact of a stronger U.S. dollar on six different groups of economic actors, as Figure shows: (1) U.S. exporters selling abroad; (2) foreign exporters (that is, firms selling imports in the U.S. economy); (3) U.S. tourists abroad; (4) foreign tourists visiting the United States; (5) U.S. investors (either foreign direct investment or portfolio investment) considering opportunities in other countries; (6) and foreign investors considering opportunities in the U.S. economy.
For a U.S. firm selling abroad, a stronger U.S. dollar is a curse. A strong U.S. dollar means that foreign currencies are correspondingly weak. When this exporting firm earns foreign currencies through its export sales, and then converts them back to U.S. dollars to pay workers, suppliers, and investors, the stronger dollar means that the foreign currency buys fewer U.S. dollars than if the currency had not strengthened, and that the firm’s profits (as measured in dollars) fall. As a result, the firm may choose to reduce its exports, or it may raise its selling price, which will also tend to reduce its exports. In this way, a stronger currency reduces a country’s exports.
Conversely, for a foreign firm selling in the U.S. economy, a stronger dollar is a blessing. Each dollar earned through export sales, when traded back into the exporting firm's home currency, will now buy more home currency than expected before the dollar had strengthened. As a result, the stronger dollar means that the importing firm will earn higher profits than expected. The firm will seek to expand its sales in the U.S. economy, or it may reduce prices, which will also lead to expanded sales. In this way, a stronger U.S. dollar means that consumers will purchase more from foreign producers, expanding the country’s level of imports.
For a U.S. tourist abroad, who is exchanging U.S. dollars for foreign currency as necessary, a stronger U.S. dollar is a benefit. The tourist receives more foreign currency for each U.S. dollar, and consequently the cost of the trip in U.S. dollars is lower. When a country’s currency is strong, it is a good time for citizens of that country to tour abroad. Imagine a U.S. tourist who has saved up $5,000 for a trip to South Africa. In 2010, $1 bought 7.3 South African rand, so the tourist had 36,500 rand to spend. In 2012, $1 bought 8.2 rand, so the tourist had 41,000 rand to spend. By 2015, $1 bought nearly 13 rand. Clearly, more recent years have been better for U.S. tourists to visit South Africa. For foreign visitors to the United States, the opposite pattern holds true. A relatively stronger U.S. dollar means that their own currencies are relatively weaker, so that as they shift from their own currency to U.S. dollars, they have fewer U.S. dollars than previously. When a country’s currency is strong, it is not an especially good time for foreign tourists to visit.
A stronger dollar injures the prospects of a U.S. financial investor who has already invested money in another country. A U.S. financial investor abroad must first convert U.S. dollars to a foreign currency, invest in a foreign country, and then later convert that foreign currency back to U.S. dollars. If in the meantime the U.S. dollar becomes stronger and the foreign currency becomes weaker, then when the investor converts back to U.S. dollars, the rate of return on that investment will be less than originally expected at the time it was made.
However, a stronger U.S. dollar boosts the returns of a foreign investor putting money into a U.S. investment. That foreign investor converts from the home currency to U.S. dollars and seeks a U.S. investment, while later planning to switch back to the home currency. If, in the meantime, the dollar grows stronger, then when the time comes to convert from U.S. dollars back to the foreign currency, the investor will receive more foreign currency than expected at the time the original investment was made.
The preceding paragraphs all focus on the case where the U.S. dollar becomes stronger. The first column in Figure illustrates the corresponding happy or unhappy economic reactions. The following Work It Out feature centers the analysis on the opposite: a weaker dollar.
Effects of a Weaker Dollar
Let’s work through the effects of a weaker dollar on a U.S. exporter, a foreign exporter into the United States, a U.S. tourist going abroad, a foreign tourist coming to the United States, a U.S. investor abroad, and a foreign investor in the United States.
Step 1. Note that the demand for U.S. exports is a function of the price of those exports, which depends on the dollar price of those goods and the exchange rate of the dollar in terms of foreign currency. For example, a Ford pickup truck costs $25,000 in the United States. When it is sold in the United Kingdom, the price is $25,000 / $1.30 per British pound, or £19,231. The dollar affects the price foreigners face who may purchase U.S. exports.
Step 2. Consider that, if the dollar weakens, the pound rises in value. If the pound rises to $2.00 per pound, then the price of a Ford pickup is now $25,000 / $2.00 = £12,500. A weaker dollar means the foreign currency buys more dollars, which means that U.S. exports appear less expensive.
Step 3. Summarize that a weaker U.S. dollar leads to an increase in U.S. exports. For a foreign exporter, the outcome is just the opposite.
Step 4. Suppose a brewery in England is interested in selling its Bass Ale to a grocery store in the United States. If the price of a six pack of Bass Ale is £6.00 and the exchange rate is $1.30 per British pound, the price for the grocery store is 6.00 × $1.30 = $7.80 per six pack. If the dollar weakens to $2.00 per pound, the price of Bass Ale is now 6.00 × $2.00 = $12.
Step 5. Summarize that, from the perspective of U.S. purchasers, a weaker dollar means that foreign currency is more expensive, which means that foreign goods are more expensive also. This leads to a decrease in U.S. imports, which is bad for the foreign exporter.
Step 6. Consider U.S. tourists going abroad. They face the same situation as a U.S. importer—they are purchasing a foreign trip. A weaker dollar means that their trip will cost more, since a given expenditure of foreign currency (e.g., hotel bill) will take more dollars. The result is that the tourist may not stay as long abroad, and some may choose not to travel at all.
Step 7. Consider that, for the foreign tourist to the United States, a weaker dollar is a boon. It means their currency goes further, so the cost of a trip to the United States will be less. Foreigners may choose to take longer trips to the United States, and more foreign tourists may decide to take U.S. trips.
Step 8. Note that a U.S. investor abroad faces the same situation as a U.S. importer—they are purchasing a foreign asset. A U.S. investor will see a weaker dollar as an increase in the “price” of investment, since the same number of dollars will buy less foreign currency and thus less foreign assets. This should decrease the amount of U.S. investment abroad.
Step 9. Note also that foreign investors in the Unites States will have the opposite experience. Since foreign currency buys more dollars, they will likely invest in more U.S. assets.
At this point, you should have a good sense of the major players in the foreign exchange market: firms involved in international trade, tourists, international financial investors, banks, and foreign exchange dealers. The next module shows how players can use the tools of demand and supply in foreign exchange markets to explain the underlying causes of stronger and weaker currencies (we address “stronger” and “weaker” more in the following Clear It Up feature).
Why is a stronger currency not necessarily better?
One common misunderstanding about exchange rates is that a “stronger” or “appreciating” currency must be better than a “weaker” or “depreciating” currency. After all, is it not obvious that “strong” is better than “weak”? Do not let the terminology confuse you. When a currency becomes stronger, so that it purchases more of other currencies, it benefits some in the economy and injures others. Stronger currency is not necessarily better, it is just different.
Key Concepts and Summary
In the foreign exchange market, people and firms exchange one currency to purchase another currency. The demand for dollars comes from those U.S. export firms seeking to convert their earnings in foreign currency back into U.S. dollars; foreign tourists converting their earnings in a foreign currency back into U.S. dollars; and foreign investors seeking to make financial investments in the U.S. economy. On the supply side of the foreign exchange market for the trading of U.S. dollars are foreign firms that have sold imports in the U.S. economy and are seeking to convert their earnings back to their home currency; U.S. tourists abroad; and U.S. investors seeking to make financial investments in foreign economies. When currency A can buy more of currency B, then currency A has strengthened or appreciated relative to B. When currency A can buy less of currency B, then currency A has weakened or depreciated relative to B. If currency A strengthens or appreciates relative to currency B, then currency B must necessarily weaken or depreciate with regard to currency A. A stronger currency benefits those who are buying with that currency and injures those who are selling. A weaker currency injures those, like importers, who are buying with that currency and benefits those who are selling with it, like exporters.
Self-Check Questions
How will a stronger euro affect the following economic agents?
- A British exporter to Germany.
- A Dutch tourist visiting Chile.
- A Greek bank investing in a Canadian government bond.
- A French exporter to Germany.
Hint:
- The British use the pound sterling, while Germans use the euro, so a British exporter will receive euros from export sales, which will need to be exchanged for pounds. A stronger euro will mean more pounds per euro, so the exporter will be better off. In addition, the lower price for German imports will stimulate demand for British exports. For both these reasons, a stronger euro benefits the British exporter.
- The Dutch use euros while the Chileans use pesos, so the Dutch tourist needs to turn euros into Chilean pesos. An increase in the euro means that the tourist will get more pesos per euro. As a consequence, the Dutch tourist will have a less expensive vacation than he planned, so the tourist will be better off.
- The Greek use euros while the Canadians use dollars. An increase in the euro means it will buy more Canadian dollars. As a result, the Greek bank will see a decrease in the cost of the Canadian bonds, so it may purchase more bonds. Either way, the Greek bank benefits.
- Since both the French and Germans use the euro, an increase in the euro, in terms of other currencies, should have no impact on the French exporter.
Review Questions
What is the foreign exchange market?
Describe some buyers and some sellers in the market for U.S. dollars.
What is the difference between foreign direct investment and portfolio investment?
What does it mean to hedge a financial transaction?
What does it mean to say that a currency appreciates? Depreciates? Becomes stronger? Becomes weaker?
Critical Thinking Question
Why would a nation “dollarize”—that is, adopt another country’s currency instead of having its own?
Can you think of any major disadvantages to dollarization? How would a central bank work in a country that has dollarized?
Problems
A British pound cost $2.00 in U.S. dollars in 2008, but $1.27 in U.S. dollars in 2017. Was the pound weaker or stronger against the dollar? Did the dollar appreciate or depreciate versus the pound?
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Demand and Supply Shifts in Foreign Exchange Markets
Overview
By the end of this section, you will be able to:
- Explain supply and demand for exchange rates
- Define arbitrage
- Explain purchasing power parity's importance when comparing countries.
The foreign exchange market involves firms, households, and investors who demand and supply currencies coming together through their banks and the key foreign exchange dealers. Figure (a) offers an example for the exchange rate between the U.S. dollar and the Mexican peso. The vertical axis shows the exchange rate for U.S. dollars, which in this case is measured in pesos. The horizontal axis shows the quantity of U.S. dollars traded in the foreign exchange market each day. The demand curve (D) for U.S. dollars intersects with the supply curve (S) of U.S. dollars at the equilibrium point (E), which is an exchange rate of 10 pesos per dollar and a total volume of $8.5 billion.
Figure (b) presents the same demand and supply information from the perspective of the Mexican peso. The vertical axis shows the exchange rate for Mexican pesos, which is measured in U.S. dollars. The horizontal axis shows the quantity of Mexican pesos traded in the foreign exchange market. The demand curve (D) for Mexican pesos intersects with the supply curve (S) of Mexican pesos at the equilibrium point (E), which is an exchange rate of 10 cents in U.S. currency for each Mexican peso and a total volume of 85 billion pesos. Note that the two exchange rates are inverses: 10 pesos per dollar is the same as 10 cents per peso (or $0.10 per peso). In the actual foreign exchange market, almost all of the trading for Mexican pesos is for U.S. dollars. What factors would cause the demand or supply to shift, thus leading to a change in the equilibrium exchange rate? We discuss the answer to this question in the following section.
Expectations about Future Exchange Rates
One reason to demand a currency on the foreign exchange market is the belief that the currency's value is about to increase. One reason to supply a currency—that is, sell it on the foreign exchange market—is the expectation that the currency's value is about to decline. For example, imagine that a leading business newspaper, like the Wall Street Journal or the Financial Times, runs an article predicting that the Mexican peso will appreciate in value. Figure illustrates the likely effects of such an article. Demand for the Mexican peso shifts to the right, from D0 to D1, as investors become eager to purchase pesos. Conversely, the supply of pesos shifts to the left, from S0 to S1, because investors will be less willing to give them up. The result is that the equilibrium exchange rate rises from 10 cents/peso to 12 cents/peso and the equilibrium exchange rate rises from 85 billion to 90 billion pesos as the equilibrium moves from E0 to E1.
Figure also illustrates some peculiar traits of supply and demand diagrams in the foreign exchange market. In contrast to all the other cases of supply and demand you have considered, in the foreign exchange market, supply and demand typically both move at the same time. Groups of participants in the foreign exchange market like firms and investors include some who are buyers and some who are sellers. An expectation of a future shift in the exchange rate affects both buyers and sellers—that is, it affects both demand and supply for a currency.
The shifts in demand and supply curves both cause the exchange rate to shift in the same direction. In this example, they both make the peso exchange rate stronger. However, the shifts in demand and supply work in opposing directions on the quantity traded. In this example, the rising demand for pesos is causing the quantity to rise while the falling supply of pesos is causing quantity to fall. In this specific example, the result is a higher quantity. However, in other cases, the result could be that quantity remains unchanged or declines.
This example also helps to explain why exchange rates often move quite substantially in a short period of a few weeks or months. When investors expect a country’s currency to strengthen in the future, they buy the currency and cause it to appreciate immediately. The currency's appreciation can lead other investors to believe that future appreciation is likely—and thus lead to even further appreciation. Similarly, a fear that a currency might weaken quickly leads to an actual weakening of the currency, which often reinforces the belief that the currency will weaken further. Thus, beliefs about the future path of exchange rates can be self-reinforcing, at least for a time, and a large share of the trading in foreign exchange markets involves dealers trying to outguess each other on what direction exchange rates will move next.
Differences across Countries in Rates of Return
The motivation for investment, whether domestic or foreign, is to earn a return. If rates of return in a country look relatively high, then that country will tend to attract funds from abroad. Conversely, if rates of return in a country look relatively low, then funds will tend to flee to other economies. Changes in the expected rate of return will shift demand and supply for a currency. For example, imagine that interest rates rise in the United States as compared with Mexico. Thus, financial investments in the United States promise a higher return than previously. As a result, more investors will demand U.S. dollars so that they can buy interest-bearing assets and fewer investors will be willing to supply U.S. dollars to foreign exchange markets. Demand for the U.S. dollar will shift to the right, from D0 to D1, and supply will shift to the left, from S0 to S1, as Figure shows. The new equilibrium (E1), will occur at an exchange rate of nine pesos/dollar and the same quantity of $8.5 billion. Thus, a higher interest rate or rate of return relative to other countries leads a nation’s currency to appreciate or strengthen, and a lower interest rate relative to other countries leads a nation’s currency to depreciate or weaken. Since a nation’s central bank can use monetary policy to affect its interest rates, a central bank can also cause changes in exchange rates—a connection that we will discuss in more detail later in this chapter.
Relative Inflation
If a country experiences a relatively high inflation rate compared with other economies, then the buying power of its currency is eroding, which will tend to discourage anyone from wanting to acquire or to hold the currency. Figure shows an example based on an actual episode concerning the Mexican peso. In 1986–87, Mexico experienced an inflation rate of over 200%. Not surprisingly, as inflation dramatically decreased the peso's purchasing power in Mexico. The peso's exchange rate value declined as well. Figure shows that the demand for the peso on foreign exchange markets decreased from D0 to D1, while the peso's supply increased from S0 to S1. The equilibrium exchange rate fell from $2.50 per peso at the original equilibrium (E0) to $0.50 per peso at the new equilibrium (E1). In this example, the quantity of pesos traded on foreign exchange markets remained the same, even as the exchange rate shifted.
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Purchasing Power Parity
Over the long term, exchange rates must bear some relationship to the currency's buying power in terms of internationally traded goods. If at a certain exchange rate it was much cheaper to buy internationally traded goods—such as oil, steel, computers, and cars—in one country than in another country, businesses would start buying in the cheap country, selling in other countries, and pocketing the profits.
For example, if a U.S. dollar is worth $1.30 in Canadian currency, then a car that sells for $20,000 in the United States should sell for $26,000 in Canada. If the price of cars in Canada were much lower than $26,000, then at least some U.S. car-buyers would convert their U.S. dollars to Canadian dollars and buy their cars in Canada. If the price of cars were much higher than $26,000 in this example, then at least some Canadian buyers would convert their Canadian dollars to U.S. dollars and go to the United States to purchase their cars. This is known as arbitrage, the process of buying and selling goods or currencies across international borders at a profit. It may occur slowly, but over time, it will force prices and exchange rates to align so that the price of internationally traded goods is similar in all countries.
We call the exchange rate that equalizes the prices of internationally traded goods across countries the purchasing power parity (PPP) exchange rate. A group of economists at the International Comparison Program, run by the World Bank, have calculated the PPP exchange rate for all countries, based on detailed studies of the prices and quantities of internationally tradable goods.
The purchasing power parity exchange rate has two functions. First, economists often use PPP exchange rates for international comparison of GDP and other economic statistics. Imagine that you are preparing a table showing the size of GDP in many countries in several recent years, and for ease of comparison, you are converting all the values into U.S. dollars. When you insert the value for Japan, you need to use a yen/dollar exchange rate. However, should you use the market exchange rate or the PPP exchange rate? Market exchange rates bounce around. In 2014, the exchange rate was 105 yen/dollar, but in late 2015 the U.S. dollar exchange rate versus the yen was 121 yen/dollar. For simplicity, say that Japan’s GDP was ¥500 trillion in both 2014 and 2015. If you use the market exchange rates, then Japan’s GDP will be $4.8 trillion in 2014 (that is, ¥500 trillion /(¥105/dollar)) and $4.1 trillion in 2015 (that is, ¥500 trillion /(¥121/dollar)).
The misleading appearance of a changing Japanese economy occurs only because we used the market exchange rate, which often has short-run rises and falls. However, PPP exchange rates stay fairly constant and change only modestly, if at all, from year to year.
The second function of PPP is that exchanges rates will often get closer to it as time passes. It is true that in the short and medium run, as exchange rates adjust to relative inflation rates, rates of return, and to expectations about how interest rates and inflation will shift, the exchange rates will often move away from the PPP exchange rate for a time. However, knowing the PPP will allow you to track and predict exchange rate relationships.
Key Concepts and Summary
In the extreme short run, ranging from a few minutes to a few weeks, speculators who are trying to invest in currencies that will grow stronger, and to sell currencies that will grow weaker influence exchange rates. Such speculation can create a self-fulfilling prophecy, at least for a time, where an expected appreciation leads to a stronger currency and vice versa. In the relatively short run, differences in rates of return influence exchange rate markets. Countries with relatively high real rates of return (for example, high interest rates) will tend to experience stronger currencies as they attract money from abroad, while countries with relatively low rates of return will tend to experience weaker exchange rates as investors convert to other currencies.
In the medium run of a few months or a few years, inflation rates influence exchange rate markets. Countries with relatively high inflation will tend to experience less demand for their currency than countries with lower inflation, and thus currency depreciation. Over long periods of many years, exchange rates tend to adjust toward the purchasing power parity (PPP) rate, which is the exchange rate such that the prices of internationally tradable goods in different countries, when converted at the PPP exchange rate to a common currency, are similar in all economies.
Self-Check Questions
Suppose that political unrest in Egypt leads financial markets to anticipate a depreciation in the Egyptian pound. How will that affect the demand for pounds, supply of pounds, and exchange rate for pounds compared to, say, U.S. dollars?
Hint:
Expected depreciation in a currency will lead people to divest themselves of the currency. We should expect to see an increase in the supply of pounds and a decrease in demand for pounds. The result should be a decrease in the value of the pound vis à vis the dollar.
Suppose U.S. interest rates decline compared to the rest of the world. What would be the likely impact on the demand for dollars, supply of dollars, and exchange rate for dollars compared to, say, euros?
Hint:
Lower U.S. interest rates make U.S. assets less desirable compared to assets in the European Union. We should expect to see a decrease in demand for dollars and an increase in supply of dollars in foreign currency markets. As a result, we should expect to see the dollar depreciate compared to the euro.
Suppose Argentina gets inflation under control and the Argentine inflation rate decreases substantially. What would likely happen to the demand for Argentine pesos, the supply of Argentine pesos, and the peso/U.S. dollar exchange rate?
Hint:
A decrease in Argentine inflation relative to other countries should cause an increase in demand for pesos, a decrease in supply of pesos, and an appreciation of the peso in foreign currency markets.
Review Questions
Does an expectation of a stronger exchange rate in the future affect the exchange rate in the present? If so, how?
Does a higher rate of return in a nation’s economy, all other things being equal, affect the exchange rate of its currency? If so, how?
Does a higher inflation rate in an economy, other things being equal, affect the exchange rate of its currency? If so, how?
What is the purchasing power parity exchange rate?
Critical Thinking Questions
If a country’s currency is expected to appreciate in value, what would you think will be the impact of expected exchange rates on yields (e.g., the interest rate paid on government bonds) in that country? Hint: Think about how expected exchange rate changes and interest rates affect a currency's demand and supply.
Do you think that a country experiencing hyperinflation is more or less likely to have an exchange rate equal to its purchasing power parity value when compared to a country with a low inflation rate?
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Macroeconomic Effects of Exchange Rates
Overview
By the end of this section you will be able to:
- Explain how exchange rate shifting influences aggregate demand and supply
- Explain how shifting exchange rates also can influence loans and banks
A central bank will be concerned about the exchange rate for multiple reasons: (1) Movements in the exchange rate will affect the quantity of aggregate demand in an economy; (2) frequent substantial fluctuations in the exchange rate can disrupt international trade and cause problems in a nation’s banking system–this may contribute to an unsustainable balance of trade and large inflows of international financial capital, which can set up the economy for a deep recession if international investors decide to move their money to another country. Let’s discuss these scenarios in turn.
Exchange Rates, Aggregate Demand, and Aggregate Supply
Foreign trade in goods and services typically involves incurring the costs of production in one currency while receiving revenues from sales in another currency. As a result, movements in exchange rates can have a powerful effect on incentives to export and import, and thus on aggregate demand in the economy as a whole.
For example, in 1999, when the euro first became a currency, its value measured in U.S. currency was $1.06/euro. By the end of 2013, the euro had risen (and the U.S. dollar had correspondingly weakened) to $1.37/euro. However, by the end of February, 2017, the exchange rate was once again $1.06/euro. Consider the situation of a French firm that each year incurs €10 million in costs, and sells its products in the United States for $10 million. In 1999, when this firm converted $10 million back to euros at the exchange rate of $1.06/euro (that is, $10 million × [€1/$1.06]), it received €9.4 million, and suffered a loss. In 2013, when this same firm converted $10 million back to euros at the exchange rate of $1.37/euro (that is, $10 million × [€1 euro/$1.37]), it received approximately €7.3 million and an even larger loss. In the beginning of 2017, with the exchange rate back at $1.06/euro the firm would suffer a loss once again. This example shows how a stronger euro discourages exports by the French firm, because it makes the costs of production in the domestic currency higher relative to the sales revenues earned in another country. From the point of view of the U.S. economy, the example also shows how a weaker U.S. dollar encourages exports.
Since an increase in exports results in more dollars flowing into the economy, and an increase in imports means more dollars are flowing out, it is easy to conclude that exports are “good” for the economy and imports are “bad,” but this overlooks the role of exchange rates. If an American consumer buys a Japanese car for $20,000 instead of an American car for $30,000, it may be tempting to argue that the American economy has lost out. However, the Japanese company will have to convert those dollars to yen to pay its workers and operate its factories. Whoever buys those dollars will have to use them to purchase American goods and services, so the money comes right back into the American economy. At the same time, the consumer saves money by buying a less expensive import, and can use the extra money for other purposes.
Fluctuations in Exchange Rates
Exchange rates can fluctuate a great deal in the short run. As yet one more example, the Indian rupee moved from 39 rupees/dollar in February 2008 to 51 rupees/dollar in March 2009, a decline of more than one-fourth in the value of the rupee on foreign exchange markets. Figure earlier showed that even two economically developed neighboring economies like the United States and Canada can see significant movements in exchange rates over a few years. For firms that depend on export sales, or firms that rely on imported inputs to production, or even purely domestic firms that compete with firms tied into international trade—which in many countries adds up to half or more of a nation’s GDP—sharp movements in exchange rates can lead to dramatic changes in profits and losses. A central bank may desire to keep exchange rates from moving too much as part of providing a stable business climate, where firms can focus on productivity and innovation, not on reacting to exchange rate fluctuations.
One of the most economically destructive effects of exchange rate fluctuations can happen through the banking system. Financial institutions measure most international loans are measured in a few large currencies, like U.S. dollars, European euros, and Japanese yen. In countries that do not use these currencies, banks often borrow funds in the currencies of other countries, like U.S. dollars, but then lend in their own domestic currency. The left-hand chain of events in Figure shows how this pattern of international borrowing can work. A bank in Thailand borrows one million in U.S. dollars. Then the bank converts the dollars to its domestic currency—in the case of Thailand, the currency is the baht—at a rate of 40 baht/dollar. The bank then lends the baht to a firm in Thailand. The business repays the loan in baht, and the bank converts it back to U.S. dollars to pay off its original U.S. dollar loan.
This process of borrowing in a foreign currency and lending in a domestic currency can work just fine, as long as the exchange rate does not shift. In the scenario outlined, if the dollar strengthens and the baht weakens, a problem arises. The right-hand chain of events in Figure illustrates what happens when the baht unexpectedly weakens from 40 baht/dollar to 50 baht/dollar. The Thai firm still repays the loan in full to the bank. However, because of the shift in the exchange rate, the bank cannot repay its loan in U.S. dollars. (Of course, if the exchange rate had changed in the other direction, making the Thai currency stronger, the bank could have realized an unexpectedly large profit.)
In 1997–1998, countries across eastern Asia, like Thailand, Korea, Malaysia, and Indonesia, experienced a sharp depreciation of their currencies, in some cases 50% or more. These countries had been experiencing substantial inflows of foreign investment capital, with bank lending increasing by 20% to 30% per year through the mid-1990s. When their exchange rates depreciated, the banking systems in these countries were bankrupt. Argentina experienced a similar chain of events in 2002. When the Argentine peso depreciated, Argentina’s banks found themselves unable to pay back what they had borrowed in U.S. dollars.
Banks play a vital role in any economy in facilitating transactions and in making loans to firms and consumers. When most of a country’s largest banks become bankrupt simultaneously, a sharp decline in aggregate demand and a deep recession results. Since the main responsibilities of a central bank are to control the money supply and to ensure that the banking system is stable, a central bank must be concerned about whether large and unexpected exchange rate depreciation will drive most of the country’s existing banks into bankruptcy. For more on this concern, return to the chapter on .
Summing Up Public Policy and Exchange Rates
Every nation would prefer a stable exchange rate to facilitate international trade and reduce the degree of risk and uncertainty in the economy. However, a nation may sometimes want a weaker exchange rate to stimulate aggregate demand and reduce a recession, or a stronger exchange rate to fight inflation. The country must also be concerned that rapid movements from a weak to a strong exchange rate may cripple its export industries, while rapid movements from a strong to a weak exchange rate can cripple its banking sector. In short, every choice of an exchange rate—whether it should be stronger or weaker, or fixed or changing—represents potential tradeoffs.
Key Concepts and Summary
A central bank will be concerned about the exchange rate for several reasons. Exchange rates will affect imports and exports, and thus affect aggregate demand in the economy. Fluctuations in exchange rates may cause difficulties for many firms, but especially banks. The exchange rate may accompany unsustainable flows of international financial capital.
Self-Check Questions
This chapter has explained that “one of the most economically destructive effects of exchange rate fluctuations can happen through the banking system,” if banks borrow from abroad to lend domestically. Why is this less likely to be a problem for the U.S. banking system?
Hint:
The problem occurs when banks borrow foreign currency but lend in domestic currency. Since banks’ assets (loans they made) are in domestic currency, while their debts (money they borrowed) are in foreign currency, when the domestic currency declines, their debts grow larger. If the domestic currency falls substantially in value, as happened during the Asian financial crisis, then the banking system could fail. This problem is unlikely to occur for U.S. banks because, even when they borrow from abroad, they tend to borrow dollars. Remember, there are trillions of dollars in circulation in the global economy. Since both assets and debts are in dollars, a change in the value of the dollar does not cause banking system failure the way it can when banks borrow in foreign currency.
A booming economy can attract financial capital inflows, which promote further growth. However, capital can just as easily flow out of the country, leading to economic recession. Is a country whose economy is booming because it decided to stimulate consumer spending more or less likely to experience capital flight than an economy whose boom is caused by economic investment expenditure?
Hint:
While capital flight is possible in either case, if a country borrows to invest in real capital it is more likely to be able to generate the income to pay back its debts than a country that borrows to finance consumption. As a result, an investment-stimulated economy is less likely to provoke capital flight and economic recession.
Review Questions
What are some of the reasons a central bank is likely to care, at least to some extent, about the exchange rate?
How can an unexpected fall in exchange rates injure the financial health of a nation’s banks?
Critical Thinking Questions
Suppose a country has an overall balance of trade so that exports of goods and services equal imports of goods and services. Does that imply that the country has balanced trade with each of its trading partners?
We learned that changes in exchange rates and the corresponding changes in the balance of trade amplify monetary policy. From the perspective of a nation’s central bank, is this a good thing or a bad thing?
If a developing country needs foreign capital inflows, management expertise, and technology, how can it encourage foreign investors while at the same time protect itself against capital flight and banking system collapse, as happened during the Asian financial crisis?
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Exchange Rate Policies
Overview
By the end of this section, you will be able to:
- Differentiate among a floating exchange rate, a soft peg, a hard peg, and a merged currency
- Identify the tradeoffs that come with a floating exchange rate, a soft peg, a hard peg, and a merged currency
Exchange rate policies come in a range of different forms listed in Figure: let the foreign exchange market determine the exchange rate; let the market set the value of the exchange rate most of the time, but have the central bank sometimes intervene to prevent fluctuations that seem too large; have the central bank guarantee a specific exchange rate; or share a currency with other countries. Let’s discuss each type of exchange rate policy and its tradeoffs.
Floating Exchange Rates
We refer to a policy which allows the foreign exchange market to set exchange rates as a floating exchange rate. The U.S. dollar is a floating exchange rate, as are the currencies of about 40% of the countries in the world economy. The major concern with this policy is that exchange rates can move a great deal in a short time.
Consider the U.S. exchange rate expressed in terms of another fairly stable currency, the Japanese yen, as Figure shows. On January 1, 2002, the exchange rate was 133 yen/dollar. On January 1, 2005, it was 103 yen/dollar. On June 1, 2007, it was 122 yen/dollar, on January 1, 2012, it was 77 yen per dollar, and on March 1, 2015, it was 120 yen per dollar. As investor sentiment swings back and forth, driving exchange rates up and down, exporters, importers, and banks involved in international lending are all affected. At worst, large movements in exchange rates can drive companies into bankruptcy or trigger a nationwide banking collapse. However, even in the moderate case of the yen/dollar exchange rate, these movements of roughly 30 percent back and forth impose stress on both economies as firms must alter their export and import plans to take the new exchange rates into account. Especially in smaller countries where international trade is a relatively large share of GDP, exchange rate movements can rattle their economies.
However, movements of floating exchange rates have advantages, too. After all, prices of goods and services rise and fall throughout a market economy, as demand and supply shift. If an economy experiences strong inflows or outflows of international financial capital, or has relatively high inflation, or if it experiences strong productivity growth so that purchasing power changes relative to other economies, then it makes economic sense for the exchange rate to shift as well.
Floating exchange rate advocates often argue that if government policies were more predictable and stable, then inflation rates and interest rates would be more predictable and stable. Exchange rates would bounce around less, too. The economist Milton Friedman (1912–2006), for example, wrote a defense of floating exchange rates in 1962 in his book Capitalism and Freedom:
Being in favor of floating exchange rates does not mean being in favor of unstable exchange rates. When we support a free price system [for goods and services] at home, this does not imply that we favor a system in which prices fluctuate wildly up and down. What we want is a system in which prices are free to fluctuate but in which the forces determining them are sufficiently stable so that in fact prices move within moderate ranges. This is equally true in a system of floating exchange rates. The ultimate objective is a world in which exchange rates, while free to vary, are, in fact, highly stable because basic economic policies and conditions are stable.
Advocates of floating exchange rates admit that, yes, exchange rates may sometimes fluctuate. They point out, however, that if a central bank focuses on preventing either high inflation or deep recession, with low and reasonably steady interest rates, then exchange rates will have less reason to vary.
Using Soft Pegs and Hard Pegs
When a government intervenes in the foreign exchange market so that the currency's exchange rate is different from what the market would have produced, it establishes a “peg” for its currency. A soft peg is the name for an exchange rate policy where the government usually allows the market to set exchange rate, but in some cases, especially if the exchange rate seems to be moving rapidly in one direction, the central bank will intervene in the market. With a hard peg exchange rate policy, the central bank sets a fixed and unchanging value for the exchange rate. A central bank can implement soft peg and hard peg policies.
Suppose the market exchange rate for the Brazilian currency, the real, would be 35 cents/real with a daily quantity of 15 billion real traded in the market, as the equilibrium E0 in Figure (a) and Figure (b) show. However, Brazil's government decides that the exchange rate should be 30 cents/real, as Figure (a) shows. Perhaps Brazil sets this lower exchange rate to benefit its export industries. Perhaps it is an attempt to stimulate aggregate demand by stimulating exports. Perhaps Brazil believes that the current market exchange rate is higher than the long-term purchasing power parity value of the real, so it is minimizing fluctuations in the real by keeping it at this lower rate. Perhaps the government set the target exchange rate sometime in the past, and it is now maintaining it for the sake of stability. Whatever the reason, if Brazil’s central bank wishes to keep the exchange rate below the market level, it must face the reality that at this weaker exchange rate of 30 cents/real, the quantity demanded of its currency at 17 billion reals is greater than the quantity supplied of 13 billion reals in the foreign exchange market.
The Brazilian central bank could weaken its exchange rate in two ways. One approach is to use an expansionary monetary policy that leads to lower interest rates. In foreign exchange markets, the lower interest rates will reduce demand and increase supply of the real and lead to depreciation. Central banks do not use this technique often because lowering interest rates to weaken the currency may be in conflict with the country’s monetary policy goals. Alternatively, Brazil’s central bank could trade directly in the foreign exchange market. The central bank can expand the money supply by creating reals, use the reals to purchase foreign currencies, and avoid selling any of its own currency. In this way, it can fill the gap between quantity demanded and quantity supplied of its currency.
Figure (b) shows the opposite situation. Here, the Brazilian government desires a stronger exchange rate of 40 cents/real than the market rate of 35 cents/real. Perhaps Brazil desires the stronger currency to reduce aggregate demand and to fight inflation, or perhaps Brazil believes that that current market exchange rate is temporarily lower than the long-term rate. Whatever the reason, at the higher desired exchange rate, the quantity supplied of 16 billion reals exceeds the quantity demanded of 14 billion reals.
Brazil’s central bank can use a contractionary monetary policy to raise interest rates, which will increase demand and reduce currency supply on foreign exchange markets, and lead to an appreciation. Alternatively, Brazil’s central bank can trade directly in the foreign exchange market. In this case, with an excess supply of its own currency in foreign exchange markets, the central bank must use reserves of foreign currency, like U.S. dollars, to demand its own currency and thus cause an appreciation of its exchange rate.
Both a soft peg and a hard peg policy require that the central bank intervene in the foreign exchange market. However, a hard peg policy attempts to preserve a fixed exchange rate at all times. A soft peg policy typically allows the exchange rate to move up and down by relatively small amounts in the short run of several months or a year, and to move by larger amounts over time, but seeks to avoid extreme short-term fluctuations.
Tradeoffs of Soft Pegs and Hard Pegs
When a country decides to alter the market exchange rate, it faces a number of tradeoffs. If it uses monetary policy to alter the exchange rate, it then cannot at the same time use monetary policy to address issues of inflation or recession. If it uses direct purchases and sales of foreign currencies in exchange rates, then it must face the issue of how it will handle its reserves of foreign currency. Finally, a pegged exchange rate can even create additional movements of the exchange rate. For example, even the possibility of government intervention in exchange rate markets will lead to rumors about whether and when the government will intervene, and dealers in the foreign exchange market will react to those rumors. Let’s consider these issues in turn.
One concern with pegged exchange rate policies is that they imply a country’s monetary policy is no longer focused on controlling inflation or shortening recessions, but now must also take the exchange rate into account. For example, when a country pegs its exchange rate, it will sometimes face economic situations where it would like to have an expansionary monetary policy to fight recession—but it cannot do so because that policy would depreciate its exchange rate and break its hard peg. With a soft peg exchange rate policy, the central bank can sometimes ignore the exchange rate and focus on domestic inflation or recession—but in other cases the central bank may ignore inflation or recession and instead focus on its soft peg exchange rate. With a hard peg policy, domestic monetary policy is effectively no longer determined by domestic inflation or unemployment, but only by what monetary policy is needed to keep the exchange rate at the hard peg.
Another issue arises when a central bank intervenes directly in the exchange rate market. If a central bank ends up in a situation where it is perpetually creating and selling its own currency on foreign exchange markets, it will be buying the currency of other countries, like U.S. dollars or euros, to hold as reserves. Holding large reserves of other currencies has an opportunity cost, and central banks will not wish to boost such reserves without limit.
In addition, a central bank that causes a large increase in the supply of money is also risking an inflationary surge in aggregate demand. Conversely, when a central bank wishes to buy its own currency, it can do so by using its reserves of international currency like the U.S. dollar or the euro. However, if the central bank runs out of such reserves, it can no longer use this method to strengthen its currency. Thus, buying foreign currencies in exchange rate markets can be expensive and inflationary, while selling foreign currencies can work only until a central bank runs out of reserves.
Yet another issue is that when a government pegs its exchange rate, it may unintentionally create another reason for additional fluctuation. With a soft peg policy, foreign exchange dealers and international investors react to every rumor about how or when the central bank is likely to intervene to influence the exchange rate, and as they react to rumors the exchange rate will shift up and down. Thus, even though the goal of a soft peg policy is to reduce short-term fluctuations of the exchange rate, the existence of the policy—when anticipated in the foreign exchange market—may sometimes increase short-term fluctuations as international investors try to anticipate how and when the central bank will act. The following Clear It Up feature discusses the effects of international capital flows—capital that flows across national boundaries as either portfolio investment or direct investment.
How do Tobin taxes control the flow of capital?
Some countries like Chile and Malaysia have sought to reduce movements in exchange rates by limiting international financial capital inflows and outflows. The government can enact this policy either through targeted taxes or by regulations.
Taxes on international capital flows are sometimes known as Tobin taxes, named after James Tobin, the 1981 Nobel laureate in economics who proposed such a tax in a 1972 lecture. For example, a government might tax all foreign exchange transactions, or attempt to tax short-term portfolio investment while exempting long-term foreign direct investment. Countries can also use regulation to forbid certain kinds of foreign investment in the first place or to make it difficult for international financial investors to withdraw their funds from a country.
The goal of such policies is to reduce international capital flows, especially short-term portfolio flows, in the hope that doing so will reduce the chance of large movements in exchange rates that can bring macroeconomic disaster.
However, proposals to limit international financial flows have severe practical difficulties. National governments impose taxes, not international ones. If one government imposes a Tobin tax on exchange rate transactions carried out within its territory, a firm based someplace like the Grand Caymans, an island nation in the Caribbean well-known for allowing some financial wheeling and dealing might easily operate the exchange rate market. In an interconnected global economy, if goods and services are allowed to flow across national borders, then payments need to flow across borders, too. It is very difficult—in fact close to impossible—for a nation to allow only the flows of payments that relate to goods and services, while clamping down or taxing other flows of financial capital. If a nation participates in international trade, it must also participate in international capital movements.
Finally, countries all over the world, especially low-income countries, are crying out for foreign investment to help develop their economies. Policies that discourage international financial investment may prevent some possible harm, but they rule out potentially substantial economic benefits as well.
A hard peg exchange rate policy will not allow short-term fluctuations in the exchange rate. If the government first announces a hard peg and then later changes its mind—perhaps the government becomes unwilling to keep interest rates high or to hold high levels of foreign exchange reserves—then the result of abandoning a hard peg could be a dramatic shift in the exchange rate.
In the mid-2000s, about one-third of the countries in the world used a soft peg approach and about one-quarter used a hard peg approach. The general trend in the 1990s was to shift away from a soft peg approach in favor of either floating rates or a hard peg. The concern is that a successful soft peg policy may, for a time, lead to very little variation in exchange rates, so that firms and banks in the economy begin to act as if a hard peg exists. When the exchange rate does move, the effects are especially painful because firms and banks have not planned and hedged against a possible change. Thus, the argument went, it is better either to be clear that the exchange rate is always flexible, or that it is fixed, but choosing an in-between soft peg option may end up being worst of all.
A Merged Currency
A final approach to exchange rate policy is for a nation to choose a common currency shared with one or more nations is also called a merged currency. A merged currency approach eliminates foreign exchange risk altogether. Just as no one worries about exchange rate movements when buying and selling between New York and California, Europeans know that the value of the euro will be the same in Germany and France and other European nations that have adopted the euro.
However, a merged currency also poses problems. Like a hard peg, a merged currency means that a nation has given up altogether on domestic monetary policy, and instead has put its interest rate policies in other hands. When Ecuador uses the U.S. dollar as its currency, it has no voice in whether the Federal Reserve raises or lowers interest rates. The European Central Bank that determines monetary policy for the euro has representatives from all the euro nations. However, from the standpoint of, say, Portugal, there will be times when the decisions of the European Central Bank about monetary policy do not match the decisions that a Portuguese central bank would have made.
The lines between these four different exchange rate policies can blend into each other. For example, a soft peg exchange rate policy in which the government almost never acts to intervene in the exchange rate market will look a great deal like a floating exchange rate. Conversely, a soft peg policy in which the government intervenes often to keep the exchange rate near a specific level will look a lot like a hard peg. A decision to merge currencies with another country is, in effect, a decision to have a permanently fixed exchange rate with those countries, which is like a very hard exchange rate peg. Table summarizes the range of exchange rates policy choices, with their advantages and disadvantages.
| Situation | Floating Exchange Rates | Soft Peg | Hard Peg | Merged Currency |
|---|---|---|---|---|
| Large short-run fluctuations in exchange rates? | Often considerable in the short term | Maybe less in the short run, but still large changes over time | None, unless a change in the fixed rate | None |
| Large long-term fluctuations in exchange rates? | Can often happen | Can often happen | Cannot happen unless hard peg changes, in which case substantial volatility can occur | Cannot happen |
| Power of central bank to conduct countercyclical monetary policy? | Flexible exchange rates make monetary policy stronger | Some power, although conflicts may arise between exchange rate policy and countercyclical policy | Very little; central bank must keep exchange rate fixed | None; nation does not have its own currency |
| Costs of holding foreign exchange reserves? | Do not need to hold reserves | Hold moderate reserves that rise and fall over time | Hold large reserves | No need to hold reserves |
| Risk of ending up with an exchange rate that causes a large trade imbalance and very high inflows or outflows of financial capital? | Adjusts often | Adjusts over the medium term, if not the short term | May end up over time either far above or below the market level | Cannot adjust |
Global macroeconomics would be easier if the whole world had one currency and one central bank. The exchange rates between different currencies complicate the picture. If financial markets solely set exchange rates, they fluctuate substantially as short-term portfolio investors try to anticipate tomorrow’s news. If the government attempts to intervene in exchange rate markets through soft pegs or hard pegs, it gives up at least some of the power to use monetary policy to focus on domestic inflations and recessions, and it risks causing even greater fluctuations in foreign exchange markets.
There is no consensus among economists about which exchange rate policies are best: floating, soft peg, hard peg, or merged currencies. The choice depends both on how well a nation’s central bank can implement a specific exchange rate policy and on how well a nation’s firms and banks can adapt to different exchange rate policies. A national economy that does a fairly good job at achieving the four main economic goals of growth, low inflation, low unemployment, and a sustainable balance of trade will probably do just fine most of the time with any exchange rate policy. Conversely, no exchange rate policy is likely to save an economy that consistently fails at achieving these goals. Alternatively, a merged currency applied across wide geographic and cultural areas carries with it its own set of problems, such as the ability for countries to conduct their own independent monetary policies.
Is a Stronger Dollar Good for the U.S. Economy?
The foreign exchange value of the dollar is a price and whether a higher price is good or bad depends on where you are standing: sellers benefit from higher prices and buyers are harmed. A stronger dollar is good for U.S. imports (and people working for U.S. importers) and U.S. investment abroad. It is also good for U.S. tourists going to other countries, since their dollar goes further. However, a stronger dollar is bad for U.S. exports (and people working in U.S. export industries); it is bad for foreign investment in the United States (leading, for example, to higher U.S. interest rates); and it is bad for foreign tourists (as well as U.S hotels, restaurants, and others in the tourist industry). In short, whether the U.S. dollar is good or bad is a more complex question than you may have thought. The economic answer is “it depends.”
Key Concepts and Summary
In a floating exchange rate policy, a government determines its country’s exchange rate in the foreign exchange market. In a soft peg exchange rate policy, the foreign exchange market usually determines a country's exchange rate, but the government sometimes intervenes to strengthen or weaken it. In a hard peg exchange rate policy, the government chooses an exchange rate. A central bank can intervene in exchange markets in two ways. It can raise or lower interest rates to make the currency stronger or weaker. It also can directly purchase or sell its currency in foreign exchange markets. All exchange rates policies face tradeoffs. A hard peg exchange rate policy will reduce exchange rate fluctuations, but means that a country must focus its monetary policy on the exchange rate, not on fighting recession or controlling inflation. When a nation merges its currency with another nation, it gives up on nationally oriented monetary policy altogether.
A soft peg exchange rate may create additional volatility as exchange rate markets try to anticipate when and how the government will intervene. A flexible exchange rate policy allows monetary policy to focus on inflation and unemployment, and allows the exchange rate to change with inflation and rates of return, but also raises a risk that exchange rates may sometimes make large and abrupt movements. The spectrum of exchange rate policies includes: (a) a floating exchange rate, (b) a pegged exchange rate, soft or hard, and (c) a merged currency. Monetary policy can focus on a variety of goals: (a) inflation; (b) inflation or unemployment, depending on which is the most dangerous obstacle; and (c) a long-term rule based policy designed to keep the money supply stable and predictable.
Self-Check Questions
How would a contractionary monetary policy affect the exchange rate, net exports, aggregate demand, and aggregate supply?
Hint:
A contractionary monetary policy, by driving up domestic interest rates, would cause the currency to appreciate. The higher value of the currency in foreign exchange markets would reduce exports, since from the perspective of foreign buyers, they are now more expensive. The higher value of the currency would similarly stimulate imports, since they would now be cheaper from the perspective of domestic buyers. Lower exports and higher imports cause net exports (EX – IM) to fall, which causes aggregate demand to fall. The result would be a decrease in GDP working through the exchange rate mechanism reinforcing the effect contractionary monetary policy has on domestic investment expenditure. However, cheaper imports would stimulate aggregate supply, bringing GDP back to potential, though at a lower price level.
A central bank can allow its currency to fall indefinitely, but it cannot allow its currency to rise indefinitely. Why not?
Hint:
For a currency to fall, a central bank need only supply more of its currency in foreign exchange markets. It can print as much domestic currency as it likes. For a currency to rise, a central bank needs to buy its currency in foreign exchange markets, paying with foreign currency. Since no central bank has an infinite amount of foreign currency reserves, it cannot buy its currency indefinitely.
Is a country for which imports and exports comprise a large fraction of the GDP more likely to adopt a flexible exchange rate or a fixed (hard peg) exchange rate?
Hint:
Variations in exchange rates, because they change import and export prices, disturb international trade flows. When trade is a large part of a nation’s economic activity, government will find it more advantageous to fix exchange rates to minimize disruptions of trade flows.
Review Questions
What is the difference between a floating exchange rate, a soft peg, a hard peg, and dollarization?
List some advantages and disadvantages of the different exchange rate policies.
Critical Thinking Questions
Many developing countries, like Mexico, have moderate to high rates of inflation. At the same time, international trade plays an important role in their economies. What type of exchange rate regime would be best for such a country’s currency vis à vis the U.S. dollar?
What would make a country decide to change from a common currency, like the euro, back to its own currency?
References
Friedman, Milton. Capitalism and Freedom. Chicago: University of Chicago Press, 1962.
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Introduction to International Trade
Just Whose iPhone Is It?
The iPhone is a global product. Apple does not manufacture the iPhone components, nor does it assemble them. The assembly is done by Foxconn Corporation, a Taiwanese company, at its factory in Sengzhen, China. But, Samsung, the electronics firm and competitor to Apple, actually supplies many of the parts that make up an iPhone—representing about 26% of the costs of production. That means, that Samsung is both the biggest supplier and biggest competitor for Apple. Why do these two firms work together to produce the iPhone? To understand the economic logic behind international trade, you have to accept, as these firms do, that trade is about mutually beneficial exchange. Samsung is one of the world’s largest electronics parts suppliers. Apple lets Samsung focus on making the best parts, which allows Apple to concentrate on its strength—designing elegant products that are easy to use. If each company (and by extension each country) focuses on what it does best, there will be gains for all through trade.
Introduction to International Trade
In this chapter, you will learn about:
- Absolute and Comparative Advantage
- What Happens When a Country Has an Absolute Advantage in All Goods
- Intra-industry Trade between Similar Economies
- The Benefits of Reducing Barriers to International Trade
We live in a global marketplace. The food on your table might include fresh fruit from Chile, cheese from France, and bottled water from Scotland. Your wireless phone might have been made in Taiwan or Korea. The clothes you wear might be designed in Italy and manufactured in China. The toys you give to a child might have come from India. The car you drive might come from Japan, Germany, or Korea. The gasoline in the tank might be refined from crude oil from Saudi Arabia, Mexico, or Nigeria. As a worker, if your job is involved with farming, machinery, airplanes, cars, scientific instruments, or many other technology-related industries, the odds are good that a hearty proportion of the sales of your employer—and hence the money that pays your salary—comes from export sales. We are all linked by international trade, and the volume of that trade has grown dramatically in the last few decades.
The first wave of globalization started in the nineteenth century and lasted up to the beginning of World War I. Over that time, global exports as a share of global GDP rose from less than 1% of GDP in 1820 to 9% of GDP in 1913. As the Nobel Prize-winning economist Paul Krugman of Princeton University wrote in 1995:
It is a late-twentieth-century conceit that we invented the global economy just yesterday. In fact, world markets achieved an impressive degree of integration during the second half of the nineteenth century. Indeed, if one wants a specific date for the beginning of a truly global economy, one might well choose 1869, the year in which both the Suez Canal and the Union Pacific railroad were completed. By the eve of the First World War steamships and railroads had created markets for standardized commodities, like wheat and wool, that were fully global in their reach. Even the global flow of information was better than modern observers, focused on electronic technology, tend to realize: the first submarine telegraph cable was laid under the Atlantic in 1858, and by 1900 all of the world’s major economic regions could effectively communicate instantaneously.
This first wave of globalization crashed to a halt early in the twentieth century. World War I severed many economic connections. During the Great Depression of the 1930s, many nations misguidedly tried to fix their own economies by reducing foreign trade with others. World War II further hindered international trade. Global flows of goods and financial capital were rebuilt only slowly after World War II. It was not until the early 1980s that global economic forces again became as important, relative to the size of the world economy, as they were before World War I.
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Absolute and Comparative Advantage
Overview
By the end of this section, you will be able to:
- Define absolute advantage, comparative advantage, and opportunity costs
- Explain the gains of trade created when a country specializes
The American statesman Benjamin Franklin (1706–1790) once wrote: “No nation was ever ruined by trade.” Many economists would express their attitudes toward international trade in an even more positive manner. The evidence that international trade confers overall benefits on economies is pretty strong. Trade has accompanied economic growth in the United States and around the world. Many of the national economies that have shown the most rapid growth in the last several decades—for example, Japan, South Korea, China, and India—have done so by dramatically orienting their economies toward international trade. There is no modern example of a country that has shut itself off from world trade and yet prospered. To understand the benefits of trade, or why we trade in the first place, we need to understand the concepts of comparative and absolute advantage.
In 1817, David Ricardo, a businessman, economist, and member of the British Parliament, wrote a treatise called On the Principles of Political Economy and Taxation. In this treatise, Ricardo argued that specialization and free trade benefit all trading partners, even those that may be relatively inefficient. To see what he meant, we must be able to distinguish between absolute and comparative advantage.
A country has an absolute advantage over another country in producing a good if it uses fewer resources to produce that good. Absolute advantage can be the result of a country’s natural endowment. For example, extracting oil in Saudi Arabia is pretty much just a matter of “drilling a hole.” Producing oil in other countries can require considerable exploration and costly technologies for drilling and extraction—if they have any oil at all. The United States has some of the richest farmland in the world, making it easier to grow corn and wheat than in many other countries. Guatemala and Colombia have climates especially suited for growing coffee. Chile and Zambia have some of the world’s richest copper mines. As some have argued, “geography is destiny.” Chile will provide copper and Guatemala will produce coffee, and they will trade. When each country has a product others need and it can produce it with fewer resources in one country than in another, then it is easy to imagine all parties benefitting from trade. However, thinking about trade just in terms of geography and absolute advantage is incomplete. Trade really occurs because of comparative advantage.
Recall from the chapter Choice in a World of Scarcity that a country has a comparative advantage when it can produce a good at a lower cost in terms of other goods. The question each country or company should be asking when it trades is this: “What do we give up to produce this good?” It should be no surprise that the concept of comparative advantage is based on this idea of opportunity cost from Choice in a World of Scarcity. For example, if Zambia focuses its resources on producing copper, it cannot use its labor, land and financial resources to produce other goods such as corn. As a result, Zambia gives up the opportunity to produce corn. How do we quantify the cost in terms of other goods? Simplify the problem and assume that Zambia just needs labor to produce copper and corn. The companies that produce either copper or corn tell you that it takes two hours to mine a ton of copper and one hour to harvest a bushel of corn. This means the opportunity cost of producing a ton of copper is two bushels of corn. The next section develops absolute and comparative advantage in greater detail and relates them to trade.
Visit this website for a list of articles and podcasts pertaining to international trade topics.
A Numerical Example of Absolute and Comparative Advantage
Consider a hypothetical world with two countries, Saudi Arabia and the United States, and two products, oil and corn. Further assume that consumers in both countries desire both these goods. These goods are homogeneous, meaning that consumers/producers cannot differentiate between corn or oil from either country. There is only one resource available in both countries, labor hours. Saudi Arabia can produce oil with fewer resources, while the United States can produce corn with fewer resources. Table illustrates the advantages of the two countries, expressed in terms of how many hours it takes to produce one unit of each good.
| Country | Oil (hours per barrel) | Corn (hours per bushel) |
|---|---|---|
| Saudi Arabia | 1 | 4 |
| United States | 2 | 1 |
In Table, Saudi Arabia has an absolute advantage in producing oil because it only takes an hour to produce a barrel of oil compared to two hours in the United States. The United States has an absolute advantage in producing corn.
To simplify, let’s say that Saudi Arabia and the United States each have 100 worker hours (see Table). Figure illustrates what each country is capable of producing on its own using a production possibility frontier (PPF) graph. Recall from Choice in a World of Scarcity that the production possibilities frontier shows the maximum amount that each country can produce given its limited resources, in this case workers, and its level of technology.
| Country | Oil Production using 100 worker hours (barrels) | Corn Production using 100 worker hours (bushels) | |
|---|---|---|---|
| Saudi Arabia | 100 | or | 25 |
| United States | 50 | or | 100 |
Arguably Saudi and U.S. consumers desire both oil and corn to live. Let’s say that before trade occurs, both countries produce and consume at point C or C'. Thus, before trade, the Saudi Arabian economy will devote 60 worker hours to produce oil, as Table shows. Given the information in Table, this choice implies that it produces/consumes 60 barrels of oil. With the remaining 40 worker hours, since it needs four hours to produce a bushel of corn, it can produce only 10 bushels. To be at point C', the U.S. economy devotes 40 worker hours to produce 20 barrels of oil and it can allocate the remaining worker hours to produce 60 bushels of corn.
| Country | Oil Production (barrels) | Corn Production (bushels) |
|---|---|---|
| Saudi Arabia (C) | 60 | 10 |
| United States (C') | 20 | 60 |
| Total World Production | 80 | 70 |
The slope of the production possibility frontier illustrates the opportunity cost of producing oil in terms of corn. Using all its resources, the United States can produce 50 barrels of oil or 100 bushels of corn; therefore, the opportunity cost of one barrel of oil is two bushels of corn—or the slope is 1/2. Thus, in the U.S. production possibility frontier graph, every increase in oil production of one barrel implies a decrease of two bushels of corn. Saudi Arabia can produce 100 barrels of oil or 25 bushels of corn. The opportunity cost of producing one barrel of oil is the loss of 1/4 of a bushel of corn that Saudi workers could otherwise have produced. In terms of corn, notice that Saudi Arabia gives up the least to produce a barrel of oil. Table summarizes these calculations.
| Country | Opportunity cost of one unit — Oil (in terms of corn) | Opportunity cost of one unit — Corn (in terms of oil) |
|---|---|---|
| Saudi Arabia | ¼ | 4 |
| United States | 2 | ½ |
Again recall that we defined comparative advantage as the opportunity cost of producing goods. Since Saudi Arabia gives up the least to produce a barrel of oil, ( < in Table) it has a comparative advantage in oil production. The United States gives up the least to produce a bushel of corn, so it has a comparative advantage in corn production.
In this example, there is symmetry between absolute and comparative advantage. Saudi Arabia needs fewer worker hours to produce oil (absolute advantage, see Table), and also gives up the least in terms of other goods to produce oil (comparative advantage, see Table). Such symmetry is not always the case, as we will show after we have discussed gains from trade fully, but first, read the following Clear It Up feature to make sure you understand why the PPF line in the graphs is straight.
Can a production possibility frontier be straight?
When you first met the production possibility frontier (PPF) in the chapter on Choice in a World of Scarcity we drew it with an outward-bending shape. This shape illustrated that as we transferred inputs from producing one good to another—like from education to health services—there were increasing opportunity costs. In the examples in this chapter, we draw the PPFs as straight lines, which means that opportunity costs are constant. When we transfer a marginal unit of labor away from growing corn and toward producing oil, the decline in the quantity of corn and the increase in the quantity of oil is always the same. In reality this is possible only if the contribution of additional workers to output did not change as the scale of production changed. The linear production possibilities frontier is a less realistic model, but a straight line simplifies calculations. It also illustrates economic themes like absolute and comparative advantage just as clearly.
Gains from Trade
Consider the trading positions of the United States and Saudi Arabia after they have specialized and traded. Before trade, Saudi Arabia produces/consumes 60 barrels of oil and 10 bushels of corn. The United States produces/consumes 20 barrels of oil and 60 bushels of corn. Given their current production levels, if the United States can trade an amount of corn fewer than 60 bushels and receives in exchange an amount of oil greater than 20 barrels, it will gain from trade. With trade, the United States can consume more of both goods than it did without specialization and trade. (Recall that the chapter Welcome to Economics! defined specialization as it applies to workers and firms. Economists also use specialization to describe the occurrence when a country shifts resources to focus on producing a good that offers comparative advantage.) Similarly, if Saudi Arabia can trade an amount of oil less than 60 barrels and receive in exchange an amount of corn greater than 10 bushels, it will have more of both goods than it did before specialization and trade. Table illustrates the range of trades that would benefit both sides.
| The U.S. economy, after specialization, will benefit if it: | The Saudi Arabian economy, after specialization, will benefit if it: |
|---|---|
| Exports no more than 60 bushels of corn | Imports at least 10 bushels of corn |
| Imports at least 20 barrels of oil | Exports less than 60 barrels of oil |
The underlying reason why trade benefits both sides is rooted in the concept of opportunity cost, as the following Clear It Up feature explains. If Saudi Arabia wishes to expand domestic production of corn in a world without international trade, then based on its opportunity costs it must give up four barrels of oil for every one additional bushel of corn. If Saudi Arabia could find a way to give up less than four barrels of oil for an additional bushel of corn (or equivalently, to receive more than one bushel of corn for four barrels of oil), it would be better off.
What are the opportunity costs and gains from trade?
The range of trades that will benefit each country is based on the country’s opportunity cost of producing each good. The United States can produce 100 bushels of corn or 50 barrels of oil. For the United States, the opportunity cost of producing one barrel of oil is two bushels of corn. If we divide the numbers above by 50, we get the same ratio: one barrel of oil is equivalent to two bushels of corn, or (100/50 = 2 and 50/50 = 1). In a trade with Saudi Arabia, if the United States is going to give up 100 bushels of corn in exports, it must import at least 50 barrels of oil to be just as well off. Clearly, to gain from trade it needs to be able to gain more than a half barrel of oil for its bushel of corn—or why trade at all?
Recall that David Ricardo argued that if each country specializes in its comparative advantage, it will benefit from trade, and total global output will increase. How can we show gains from trade as a result of comparative advantage and specialization? Table shows the output assuming that each country specializes in its comparative advantage and produces no other good. This is 100% specialization. Specialization leads to an increase in total world production. (Compare the total world production in Table to that in Table.)
| Country | Quantity produced after 100% specialization — Oil (barrels) | Quantity produced after 100% specialization — Corn (bushels) |
|---|---|---|
| Saudi Arabia | 100 | 0 |
| United States | 0 | 100 |
| Total World Production | 100 | 100 |
What if we did not have complete specialization, as in Table? Would there still be gains from trade? Consider another example, such as when the United States and Saudi Arabia start at C and C', respectively, as Figure shows. Consider what occurs when trade is allowed and the United States exports 20 bushels of corn to Saudi Arabia in exchange for 20 barrels of oil.
Starting at point C, which shows Saudi oil production of 60, reduce Saudi oil domestic oil consumption by 20, since 20 is exported to the United States and exchanged for 20 units of corn. This enables Saudi to reach point D, where oil consumption is now 40 barrels and corn consumption has increased to 30 (see Figure). Notice that even without 100% specialization, if the “trading price,” in this case 20 barrels of oil for 20 bushels of corn, is greater than the country’s opportunity cost, the Saudis will gain from trade. Since the post-trade consumption point D is beyond its production possibility frontier, Saudi Arabia has gained from trade.
Visit this website for trade-related data visualizations.
Key Concepts and Summary
A country has an absolute advantage in those products in which it has a productivity edge over other countries; it takes fewer resources to produce a product. A country has a comparative advantage when it can produce a good at a lower cost in terms of other goods. Countries that specialize based on comparative advantage gain from trade.
Self-Check Questions
True or False: The source of comparative advantage must be natural elements like climate and mineral deposits. Explain.
Hint:
False. Anything that leads to different levels of productivity between two economies can be a source of comparative advantage. For example, the education of workers, the knowledge base of engineers and scientists in a country, the part of a split-up value chain where they have their specialized learning, economies of scale, and other factors can all determine comparative advantage.
Brazil can produce 100 pounds of beef or 10 autos. In contrast the United States can produce 40 pounds of beef or 30 autos. Which country has the absolute advantage in beef? Which country has the absolute advantage in producing autos? What is the opportunity cost of producing one pound of beef in Brazil? What is the opportunity cost of producing one pound of beef in the United States?
Hint:
Brazil has the absolute advantage in producing beef and the United States has the absolute advantage in autos. The opportunity cost of producing one pound of beef is 1/10 of an auto; in the United States it is 3/4 of an auto.
In France it takes one worker to produce one sweater, and one worker to produce one bottle of wine. In Tunisia it takes two workers to produce one sweater, and three workers to produce one bottle of wine. Who has the absolute advantage in production of sweaters? Who has the absolute advantage in the production of wine? How can you tell?
Hint:
In answering questions like these, it is often helpful to begin by organizing the information in a table, such as in the following table. Notice that, in this case, the productivity of the countries is expressed in terms of how many workers it takes to produce a unit of a product.
| Country | One Sweater | One Bottle of wine |
|---|---|---|
| France | 1 worker | 1 worker |
| Tunisia | 2 workers | 3 workers |
In this example, France has an absolute advantage in the production of both sweaters and wine. You can tell because it takes France less labor to produce a unit of the good.
Review Questions
What is absolute advantage? What is comparative advantage?
Under what conditions does comparative advantage lead to gains from trade?
What factors does Paul Krugman identify that supported expanding international trade in the 1800s?
Critical Thinking Questions
Are differences in geography behind the differences in absolute advantages?
Why does the United States not have an absolute advantage in coffee?
Look at [link]. Compute the opportunity costs of producing sweaters and wine in both France and Tunisia. Who has the lowest opportunity cost of producing sweaters and who has the lowest opportunity cost of producing wine? Explain what it means to have a lower opportunity cost.
Problems
France and Tunisia both have Mediterranean climates that are excellent for producing/harvesting green beans and tomatoes. In France it takes two hours for each worker to harvest green beans and two hours to harvest a tomato. Tunisian workers need only one hour to harvest the tomatoes but four hours to harvest green beans. Assume there are only two workers, one in each country, and each works 40 hours a week.
- Draw a production possibilities frontier for each country. Hint: Remember the production possibility frontier is the maximum that all workers can produce at a unit of time which, in this problem, is a week.
- Identify which country has the absolute advantage in green beans and which country has the absolute advantage in tomatoes.
- Identify which country has the comparative advantage.
- How much would France have to give up in terms of tomatoes to gain from trade? How much would it have to give up in terms of green beans?
References
Krugman, Paul R. Pop Internationalism. The MIT Press, Cambridge. 1996.
Krugman, Paul R. “What Do Undergrads Need to Know about Trade?” American Economic Review 83, no. 2. 1993. 23-26.
Ricardo, David. On the Principles of Political Economy and Taxation. London: John Murray, 1817.
Ricardo, David. “On the Principles of Political Economy and Taxation.” Library of Economics and Liberty. http://www.econlib.org/library/Ricardo/ricP.html.
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2025-03-18T00:36:46.059208
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https://oercommons.org/courseware/lesson/28878/overview
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What Happens When a Country Has an Absolute Advantage in All Goods
Overview
By the end of this section, you will be able to:
- Show the relationship between production costs and comparative advantage
- Identify situations of mutually beneficial trade
- Identify trade benefits by considering opportunity costs
What happens to the possibilities for trade if one country has an absolute advantage in everything? This is typical for high-income countries that often have well-educated workers, technologically advanced equipment, and the most up-to-date production processes. These high-income countries can produce all products with fewer resources than a low-income country. If the high-income country is more productive across the board, will there still be gains from trade? Good students of Ricardo understand that trade is about mutually beneficial exchange. Even when one country has an absolute advantage in all products, trade can still benefit both sides. This is because gains from trade come from specializing in one’s comparative advantage.
Production Possibilities and Comparative Advantage
Consider the example of trade between the United States and Mexico described in Table. In this example, it takes four U.S. workers to produce 1,000 pairs of shoes, but it takes five Mexican workers to do so. It takes one U.S. worker to produce 1,000 refrigerators, but it takes four Mexican workers to do so. The United States has an absolute advantage in productivity with regard to both shoes and refrigerators; that is, it takes fewer workers in the United States than in Mexico to produce both a given number of shoes and a given number of refrigerators.
| Country | Number of Workers needed to produce 1,000 units — Shoes | Number of Workers needed to produce 1,000 units — Refrigerators |
|---|---|---|
| United States | 4 workers | 1 worker |
| Mexico | 5 workers | 4 workers |
Absolute advantage simply compares the productivity of a worker between countries. It answers the question, “How many inputs do I need to produce shoes in Mexico?” Comparative advantage asks this same question slightly differently. Instead of comparing how many workers it takes to produce a good, it asks, “How much am I giving up to produce this good in this country?” Another way of looking at this is that comparative advantage identifies the good for which the producer’s absolute advantage is relatively larger, or where the producer’s absolute productivity disadvantage is relatively smaller. The United States can produce 1,000 shoes with four-fifths as many workers as Mexico (four versus five), but it can produce 1,000 refrigerators with only one-quarter as many workers (one versus four). So, the comparative advantage of the United States, where its absolute productivity advantage is relatively greatest, lies with refrigerators, and Mexico’s comparative advantage, where its absolute productivity disadvantage is least, is in the production of shoes.
Mutually Beneficial Trade with Comparative Advantage
When nations increase production in their area of comparative advantage and trade with each other, both countries can benefit. Again, the production possibility frontier is a useful tool to visualize this benefit.
Consider a situation where the United States and Mexico each have 40 workers. For example, as Table shows, if the United States divides its labor so that 40 workers are making shoes, then, since it takes four workers in the United States to make 1,000 shoes, a total of 10,000 shoes will be produced. (If four workers can make 1,000 shoes, then 40 workers will make 10,000 shoes). If the 40 workers in the United States are making refrigerators, and each worker can produce 1,000 refrigerators, then a total of 40,000 refrigerators will be produced.
| Country | Shoe Production — using 40 workers | Refrigerator Production — using 40 workers | |
|---|---|---|---|
| United States | 10,000 shoes | or | 40,000 refrigerators |
| Mexico | 8,000 shoes | or | 10,000 refrigerators |
As always, the slope of the production possibility frontier for each country is the opportunity cost of one refrigerator in terms of foregone shoe production–when labor is transferred from producing the latter to producing the former (see Figure).
Let’s say that, in the situation before trade, each nation prefers to produce a combination of shoes and refrigerators that is shown at point A. Table shows the output of each good for each country and the total output for the two countries.
| Country | Current Shoe Production | Current Refrigerator Production |
|---|---|---|
| United States | 5,000 | 20,000 |
| Mexico | 4,000 | 5,000 |
| Total | 9,000 | 25,000 |
Continuing with this scenario, suppose that each country transfers some amount of labor toward its area of comparative advantage. For example, the United States transfers six workers away from shoes and toward producing refrigerators. As a result, U.S. production of shoes decreases by 1,500 units (6/4 × 1,000), while its production of refrigerators increases by 6,000 (that is, 6/1 × 1,000). Mexico also moves production toward its area of comparative advantage, transferring 10 workers away from refrigerators and toward production of shoes. As a result, production of refrigerators in Mexico falls by 2,500 (10/4 × 1,000), but production of shoes increases by 2,000 pairs (10/5 × 1,000). Notice that when both countries shift production toward each of their comparative advantages (what they are relatively better at), their combined production of both goods rises, as shown in Table. The reduction of shoe production by 1,500 pairs in the United States is more than offset by the gain of 2,000 pairs of shoes in Mexico, while the reduction of 2,500 refrigerators in Mexico is more than offset by the additional 6,000 refrigerators produced in the United States.
| Country | Shoe Production | Refrigerator Production |
|---|---|---|
| United States | 3,500 | 26,000 |
| Mexico | 6,000 | 2,500 |
| Total | 9,500 | 28,500 |
This numerical example illustrates the remarkable insight of comparative advantage: even when one country has an absolute advantage in all goods and another country has an absolute disadvantage in all goods, both countries can still benefit from trade. Even though the United States has an absolute advantage in producing both refrigerators and shoes, it makes economic sense for it to specialize in the good for which it has a comparative advantage. The United States will export refrigerators and in return import shoes.
How Opportunity Cost Sets the Boundaries of Trade
This example shows that both parties can benefit from specializing in their comparative advantages and trading. By using the opportunity costs in this example, it is possible to identify the range of possible trades that would benefit each country.
Mexico started out, before specialization and trade, producing 4,000 pairs of shoes and 5,000 refrigerators (see Figure and Table). Then, in the numerical example given, Mexico shifted production toward its comparative advantage and produced 6,000 pairs of shoes but only 2,500 refrigerators. Thus, if Mexico can export no more than 2,000 pairs of shoes (giving up 2,000 pairs of shoes) in exchange for imports of at least 2,500 refrigerators (a gain of 2,500 refrigerators), it will be able to consume more of both goods than before trade. Mexico will be unambiguously better off. Conversely, the United States started off, before specialization and trade, producing 5,000 pairs of shoes and 20,000 refrigerators. In the example, it then shifted production toward its comparative advantage, producing only 3,500 shoes but 26,000 refrigerators. If the United States can export no more than 6,000 refrigerators in exchange for imports of at least 1,500 pairs of shoes, it will be able to consume more of both goods and will be unambiguously better off.
The range of trades that can benefit both nations is shown in Table. For example, a trade where the U.S. exports 4,000 refrigerators to Mexico in exchange for 1,800 pairs of shoes would benefit both sides, in the sense that both countries would be able to consume more of both goods than in a world without trade.
| The U.S. economy, after specialization, will benefit if it: | The Mexican economy, after specialization, will benefit if it: |
|---|---|
| Exports fewer than 6,000 refrigerators | Imports at least 2,500 refrigerators |
| Imports at least 1,500 pairs of shoes | Exports no more than 2,000 pairs of shoes |
Trade allows each country to take advantage of lower opportunity costs in the other country. If Mexico wants to produce more refrigerators without trade, it must face its domestic opportunity costs and reduce shoe production. If Mexico, instead, produces more shoes and then trades for refrigerators made in the United States, where the opportunity cost of producing refrigerators is lower, Mexico can in effect take advantage of the lower opportunity cost of refrigerators in the United States. Conversely, when the United States specializes in its comparative advantage of refrigerator production and trades for shoes produced in Mexico, international trade allows the United States to take advantage of the lower opportunity cost of shoe production in Mexico.
The theory of comparative advantage explains why countries trade: they have different comparative advantages. It shows that the gains from international trade result from pursuing comparative advantage and producing at a lower opportunity cost. The following Work It Out feature shows how to calculate absolute and comparative advantage and the way to apply them to a country’s production.
Calculating Absolute and Comparative Advantage
In Canada a worker can produce 20 barrels of oil or 40 tons of lumber. In Venezuela, a worker can produce 60 barrels of oil or 30 tons of lumber.
| Country | Oil (barrels) | Lumber (tons) | |
|---|---|---|---|
| Canada | 20 | or | 40 |
| Venezuela | 60 | or | 30 |
- Who has the absolute advantage in the production of oil or lumber? How can you tell?
- Which country has a comparative advantage in the production of oil?
- Which country has a comparative advantage in producing lumber?
- In this example, is absolute advantage the same as comparative advantage, or not?
- In what product should Canada specialize? In what product should Venezuela specialize?
Step 1. Make a table like Table.
Step 2. To calculate absolute advantage, look at the larger of the numbers for each product. One worker in Canada can produce more lumber (40 tons versus 30 tons), so Canada has the absolute advantage in lumber. One worker in Venezuela can produce 60 barrels of oil compared to a worker in Canada who can produce only 20.
Step 3. To calculate comparative advantage, find the opportunity cost of producing one barrel of oil in both countries. The country with the lowest opportunity cost has the comparative advantage. With the same labor time, Canada can produce either 20 barrels of oil or 40 tons of lumber. So in effect, 20 barrels of oil is equivalent to 40 tons of lumber: 20 oil = 40 lumber. Divide both sides of the equation by 20 to calculate the opportunity cost of one barrel of oil in Canada. 20/20 oil = 40/20 lumber. 1 oil = 2 lumber. To produce one additional barrel of oil in Canada has an opportunity cost of 2 lumber. Calculate the same way for Venezuela: 60 oil = 30 lumber. Divide both sides of the equation by 60. One oil in Venezuela has an opportunity cost of 1/2 lumber. Because 1/2 lumber < 2 lumber, Venezuela has the comparative advantage in producing oil.
Step 4. Calculate the opportunity cost of one lumber by reversing the numbers, with lumber on the left side of the equation. In Canada, 40 lumber is equivalent in labor time to 20 barrels of oil: 40 lumber = 20 oil. Divide each side of the equation by 40. The opportunity cost of one lumber is 1/2 oil. In Venezuela, the equivalent labor time will produce 30 lumber or 60 oil: 30 lumber = 60 oil. Divide each side by 30. One lumber has an opportunity cost of two oil. Canada has the lower opportunity cost in producing lumber.
Step 5. In this example, absolute advantage is the same as comparative advantage. Canada has the absolute and comparative advantage in lumber; Venezuela has the absolute and comparative advantage in oil.
Step 6. Canada should specialize in the commodity for which it has a relative lower opportunity cost, which is lumber, and Venezuela should specialize in oil. Canada will be exporting lumber and importing oil, and Venezuela will be exporting oil and importing lumber.
Comparative Advantage Goes Camping
To build an intuitive understanding of how comparative advantage can benefit all parties, set aside examples that involve national economies for a moment and consider the situation of a group of friends who decide to go camping together. The six friends have a wide range of skills and experiences, but one person in particular, Jethro, has done lots of camping before and is also a great athlete. Jethro has an absolute advantage in all aspects of camping: he is faster at carrying a backpack, gathering firewood, paddling a canoe, setting up tents, making a meal, and washing up. So here is the question: Because Jethro has an absolute productivity advantage in everything, should he do all the work?
Of course not! Even if Jethro is willing to work like a mule while everyone else sits around, he, like all mortals, only has 24 hours in a day. If everyone sits around and waits for Jethro to do everything, not only will Jethro be an unhappy camper, but there will not be much output for his group of six friends to consume. The theory of comparative advantage suggests that everyone will benefit if they figure out their areas of comparative advantage—that is, the area of camping where their productivity disadvantage is least, compared to Jethro. For example, it may be that Jethro is 80% faster at building fires and cooking meals than anyone else, but only 20% faster at gathering firewood and 10% faster at setting up tents. In that case, Jethro should focus on building fires and making meals, and others should attend to the other tasks, each according to where their productivity disadvantage is smallest. If the campers coordinate their efforts according to comparative advantage, they can all gain.
Key Concepts and Summary
Even when a country has high levels of productivity in all goods, it can still benefit from trade. Gains from trade come about as a result of comparative advantage. By specializing in a good that it gives up the least to produce, a country can produce more and offer that additional output for sale. If other countries specialize in the area of their comparative advantage as well and trade, the highly productive country is able to benefit from a lower opportunity cost of production in other countries.
Self-Check Question
In Germany it takes three workers to make one television and four workers to make one video camera. In Poland it takes six workers to make one television and 12 workers to make one video camera.
- Who has the absolute advantage in the production of televisions? Who has the absolute advantage in the production of video cameras? How can you tell?
- Calculate the opportunity cost of producing one additional television set in Germany and in Poland. (Your calculation may involve fractions, which is fine.) Which country has a comparative advantage in the production of televisions?
- Calculate the opportunity cost of producing one video camera in Germany and in Poland. Which country has a comparative advantage in the production of video cameras?
- In this example, is absolute advantage the same as comparative advantage, or not?
- In what product should Germany specialize? In what product should Poland specialize?
Hint:
- In Germany, it takes fewer workers to make either a television or a video camera. Germany has an absolute advantage in the production of both goods.
- Producing an additional television in Germany requires three workers. Shifting those three German workers will reduce video camera production by 3/4 of a camera. Producing an additional television set in Poland requires six workers, and shifting those workers from the other good reduces output of video cameras by 6/12 of a camera, or 1/2. Thus, the opportunity cost of producing televisions is lower in Poland, so Poland has the comparative advantage in the production of televisions. Note: Do not let the fractions like 3/4 of a camera or 1/2 of a video camera bother you. If either country was to expand television production by a significant amount—that is, lots more than one unit—then we will be talking about whole cameras and not fractional ones. You can also spot this conclusion by noticing that Poland’s absolute disadvantage is relatively lower in televisions, because Poland needs twice as many workers to produce a television but three times as many to produce a video camera, so the product with the relatively lower absolute disadvantage is Poland’s comparative advantage.
- Producing a video camera in Germany requires four workers, and shifting those four workers away from television production has an opportunity cost of 4/3 television sets. Producing a video camera in Poland requires 12 workers, and shifting those 12 workers away from television production has an opportunity cost of two television sets. Thus, the opportunity cost of producing video cameras is lower in Germany, and video cameras will be Germany’s comparative advantage.
- In this example, absolute advantage differs from comparative advantage. Germany has the absolute advantage in the production of both goods, but Poland has a comparative advantage in the production of televisions.
- Germany should specialize, at least to some extent, in the production of video cameras, export video cameras, and import televisions. Conversely, Poland should specialize, at least to some extent, in the production of televisions, export televisions, and import video cameras.
Review Questions
Is it possible to have a comparative advantage in the production of a good but not to have an absolute advantage? Explain.
How does comparative advantage lead to gains from trade?
Critical Thinking Questions
You just overheard your friend say the following: “Poor countries like Malawi have no absolute advantages. They have poor soil, low investments in formal education and hence low-skill workers, no capital, and no natural resources to speak of. Because they have no advantage, they cannot benefit from trade.” How would you respond?
Look at Table. Is there a range of trades for which there will be no gains?
You just got a job in Washington, D.C. You move into an apartment with some acquaintances. All your roommates, however, are slackers and do not clean up after themselves. You, on the other hand, can clean faster than each of them. You determine that you are 70% faster at dishes and 10% faster with vacuuming. All of these tasks have to be done daily. Which jobs should you assign to your roommates to get the most free time overall? Assume you have the same number of hours to devote to cleaning. Now, since you are faster, you seem to get done quicker than your roommate. What sorts of problems may this create? Can you imagine a trade-related analogy to this problem?
Problems
In Japan, one worker can make 5 tons of rubber or 80 radios. In Malaysia, one worker can make 10 tons of rubber or 40 radios.
- Who has the absolute advantage in the production of rubber or radios? How can you tell?
- Calculate the opportunity cost of producing 80 additional radios in Japan and in Malaysia. (Your calculation may involve fractions, which is fine.) Which country has a comparative advantage in the production of radios?
- Calculate the opportunity cost of producing 10 additional tons of rubber in Japan and in Malaysia. Which country has a comparative advantage in producing rubber?
- In this example, does each country have an absolute advantage and a comparative advantage in the same good?
- In what product should Japan specialize? In what product should Malaysia specialize?
Review the numbers for Canada and Venezuela from Table which describes how many barrels of oil and tons of lumber the workers can produce. Use these numbers to answer the rest of this question.
- Draw a production possibilities frontier for each country. Assume there are 100 workers in each country. Canadians and Venezuelans desire both oil and lumber. Canadians want at least 2,000 tons of lumber. Mark a point on their production possibilities where they can get at least 3,000 tons.
- Assume that the Canadians specialize completely because they figured out they have a comparative advantage in lumber. They are willing to give up 1,000 tons of lumber. How much oil should they ask for in return for this lumber to be as well off as they were with no trade? How much should they ask for if they want to gain from trading with Venezuela? Note: We can think of this “ask” as the relative price or trade price of lumber.
- Is the Canadian “ask” you identified in (b) also beneficial for Venezuelans? Use the production possibilities frontier graph for Venezuela to show that Venezuelans can gain from trade.
In [link], is there an “ask” where Venezuelans may say “no thank you” to trading with Canada?
References
Bernstein, William J. A Splendid Exchange: How Trade Shaped the World. Atlantic Monthly Press. New York. 2008.
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https://oercommons.org/courseware/lesson/28879/overview
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Intra-industry Trade between Similar Economies
Overview
By the end of this section, you will be able to:
- Identify at least two advantages of intra-industry trading
- Explain the relationship between economies of scale and intra-industry trade
Absolute and comparative advantages explain a great deal about global trading patterns. For example, they help to explain the patterns that we noted at the start of this chapter, like why you may be eating fresh fruit from Chile or Mexico, or why lower productivity regions like Africa and Latin America are able to sell a substantial proportion of their exports to higher productivity regions like the European Union and North America. Comparative advantage, however, at least at first glance, does not seem especially well-suited to explain other common patterns of international trade.
The Prevalence of Intra-industry Trade between Similar Economies
The theory of comparative advantage suggests that trade should happen between economies with large differences in opportunity costs of production. Roughly half of all world trade involves shipping goods between the fairly similar high-income economies of the United States, Canada, the European Union, Japan, Mexico, and China (see Table).
| Country | U.S. Exports Go to ... | U.S. Imports Come from ... |
|---|---|---|
| European Union | 19.0% | 21.0% |
| Canada | 22.0% | 14.0% |
| Japan | 4.0% | 6.0% |
| Mexico | 15.0% | 13.0% |
| China | 8.0% | 20.0% |
Moreover, the theory of comparative advantage suggests that each economy should specialize to a degree in certain products, and then exchange those products. A high proportion of trade, however, is intra-industry trade—that is, trade of goods within the same industry from one country to another. For example, the United States produces and exports autos and imports autos. Table shows some of the largest categories of U.S. exports and imports. In all of these categories, the United States is both a substantial exporter and a substantial importer of goods from the same industry. In 2014, according to the Bureau of Economic Analysis, the United States exported $146 billion worth of autos, and imported $327 billion worth of autos. About 60% of U.S. trade and 60% of European trade is intra-industry trade.
| Some U.S. Exports | Quantity of Exports ($ billions) | Quantity of Imports ($ billions) |
|---|---|---|
| Autos | $146 | $327 |
| Food and beverages | $144 | $126 |
| Capital goods | $550 | $551 |
| Consumer goods | $199 | $558 |
| Industrial supplies | $507 | $665 |
| Other transportation | $45 | $55 |
Why do similar high-income economies engage in intra-industry trade? What can be the economic benefit of having workers of fairly similar skills making cars, computers, machinery and other products which are then shipped across the oceans to and from the United States, the European Union, and Japan? There are two reasons: (1) The division of labor leads to learning, innovation, and unique skills; and (2) economies of scale.
Gains from Specialization and Learning
Consider the category of machinery, where the U.S. economy has considerable intra-industry trade. Machinery comes in many varieties, so the United States may be exporting machinery for manufacturing with wood, but importing machinery for photographic processing. The underlying reason why a country like the United States, Japan, or Germany produces one kind of machinery rather than another is usually not related to U.S., German, or Japanese firms and workers having generally higher or lower skills. It is just that, in working on very specific and particular products, firms in certain countries develop unique and different skills.
Specialization in the world economy can be very finely split. In fact, recent years have seen a trend in international trade, which economists call splitting up the value chain. The value chain describes how a good is produced in stages. As indicated in the beginning of the chapter, producing the iPhone involves designing and engineering the phone in the United States, supplying parts from Korea, assembling the parts in China, and advertising and marketing in the United States. Thanks in large part to improvements in communication technology, sharing information, and transportation, it has become easier to split up the value chain. Instead of production in a single large factory, different firms operating in various places and even different countries can divide the value chain. Because firms split up the value chain, international trade often does not involve nations trading whole finished products like automobiles or refrigerators. Instead, it involves shipping more specialized goods like, say, automobile dashboards or the shelving that fits inside refrigerators. Intra-industry trade between similar countries produces economic gains because it allows workers and firms to learn and innovate on particular products—and often to focus on very particular parts of the value chain.
Visit this website for some interesting information about the assembly of the iPhone.
Economies of Scale, Competition, Variety
A second broad reason that intra-industry trade between similar nations produces economic gains involves economies of scale. The concept of economies of scale, as we introduced in Production, Costs and Industry Structure, means that as the scale of output goes up, average costs of production decline—at least up to a point. Figure illustrates economies of scale for a plant producing toaster ovens. The horizontal axis of the figure shows the quantity of production by a certain firm or at a certain manufacturing plant. The vertical axis measures the average cost of production. Production plant S produces a small level of output at 30 units and has an average cost of production of $30 per toaster oven. Plant M produces at a medium level of output at 50 units, and has an average cost of production of $20 per toaster oven. Plant L produces 150 units of output with an average cost of production of only $10 per toaster oven. Although plant V can produce 200 units of output, it still has the same unit cost as Plant L.
In this example, a small or medium plant, like S or M, will not be able to compete in the market with a large or a very large plant like L or V, because the firm that operates L or V will be able to produce and sell its output at a lower price. In this example, economies of scale operate up to point L, but beyond point L to V, the additional scale of production does not continue to reduce average costs of production.
The concept of economies of scale becomes especially relevant to international trade when it enables one or two large producers to supply the entire country. For example, a single large automobile factory could probably supply all the cars consumers purchase in a smaller economy like the United Kingdom or Belgium in a given year. However, if a country has only one or two large factories producing cars, and no international trade, then consumers in that country would have relatively little choice between kinds of cars (other than the color of the paint and other nonessential options). Little or no competition will exist between different car manufacturers.
International trade provides a way to combine the lower average production costs that come from economies of scale and still have competition and variety for consumers. Large automobile factories in different countries can make and sell their products around the world. If General Motors, Ford, and Chrysler were the only players in the U.S. automobile market, the level of competition and consumer choice would be considerably lower than when U.S. carmakers must face competition from Toyota, Honda, Suzuki, Fiat, Mitsubishi, Nissan, Volkswagen, Kia, Hyundai, BMW, Subaru, and others. Greater competition brings with it innovation and responsiveness to what consumers want. America’s car producers make far better cars now than they did several decades ago, and much of the reason is competitive pressure, especially from East Asian and European carmakers.
Dynamic Comparative Advantage
The sources of gains from intra-industry trade between similar economies—namely, the learning that comes from a high degree of specialization and splitting up the value chain and from economies of scale—do not contradict the earlier theory of comparative advantage. Instead, they help to broaden the concept.
In intra-industry trade, climate or geography do not determine the level of worker productivity. Even the general level of education or skill does not determine it. Instead, how firms engage in specific learning about specialized products, including taking advantage of economies of scale determine the level of worker productivity. In this vision, comparative advantage can be dynamic—that is, it can evolve and change over time as one develops new skills and as manufacturers split the value chain in new ways. This line of thinking also suggests that countries are not destined to have the same comparative advantage forever, but must instead be flexible in response to ongoing changes in comparative advantage.
Key Concepts and Summary
A large share of global trade happens between high-income economies that are quite similar in having well-educated workers and advanced technology. These countries practice intra-industry trade, in which they import and export the same products at the same time, like cars, machinery, and computers. In the case of intra-industry trade between economies with similar income levels, the gains from trade come from specialized learning in very particular tasks and from economies of scale. Splitting up the value chain means that several stages of producing a good take place in different countries around the world.
Self-Check Questions
How can there be any economic gains for a country from both importing and exporting the same good, like cars?
Hint:
There are a number of possible advantages of intra-industry trade. Both nations can take advantage of extreme specialization and learning in certain kinds of cars with certain traits, like gas-efficient cars, luxury cars, sport-utility vehicles, higher- and lower-quality cars, and so on. Moreover, nations can take advantage of economies of scale, so that large companies will compete against each other across international borders, providing the benefits of competition and variety to customers. This same argument applies to trade between U.S. states, where people often buy products made by people of other states, even though a similar product is made within the boundaries of their own state. All states—and all countries—can benefit from this kind of competition and trade.
Table shows how the average costs of production for semiconductors (the “chips” in computer memories) change as the quantity of semiconductors built at that factory increases.
- Based on these data, sketch a curve with quantity produced on the horizontal axis and average cost of production on the vertical axis. How does the curve illustrate economies of scale?
- If the equilibrium quantity of semiconductors demanded is 90,000, can this economy take full advantage of economies of scale? What about if quantity demanded is 70,000 semiconductors? 50,000 semiconductors? 30,000 semiconductors?
- Explain how international trade could make it possible for even a small economy to take full advantage of economies of scale, while also benefiting from competition and the variety offered by several producers.
| Quantity of Semiconductors | Average Total Cost |
|---|---|
| 10,000 | $8 each |
| 20,000 | $5 each |
| 30,000 | $3 each |
| 40,000 | $2 each |
| 100,000 | $2 each |
Hint:
- Start by plotting the points on a sketch diagram and then drawing a line through them. The following figure illustrates the average costs of production of semiconductors. The curve illustrates economies of scale by showing that as the scale increases—that is, as production at this particular factory goes up—the average cost of production declines. The economies of scale exist up to an output of 40,000 semiconductors; at higher outputs, the average cost of production does not seem to decline any further.
- At any quantity demanded above 40,000, this economy can take full advantage of economies of scale; that is, it can produce at the lowest cost per unit. Indeed, if the quantity demanded was quite high, like 500,000, then there could be a number of different factories all taking full advantage of economies of scale and competing with each other. If the quantity demanded falls below 40,000, then the economy by itself, without foreign trade, cannot take full advantage of economies of scale.
- The simplest answer to this question is that the small country could have a large enough factory to take full advantage of economies of scale, but then export most of the output. For semiconductors, countries like Taiwan and Korea have recently fit this description. Moreover, this country could also import semiconductors from other countries which also have large factories, thus getting the benefits of competition and variety. A slightly more complex answer is that the country can get these benefits of economies of scale without producing semiconductors, but simply by buying semiconductors made at low cost around the world. An economy, especially a smaller country, may well end up specializing and producing a few items on a large scale, but then trading those items for other items produced on a large scale, and thus gaining the benefits of economies of scale by trade, as well as by direct production.
Review Questions
What is intra-industry trade?
What are the two main sources of economic gains from intra-industry trade?
What is splitting up the value chain?
Critical Thinking Questions
Does intra-industry trade contradict the theory of comparative advantage?
Do consumers benefit from intra-industry trade?
Why might intra-industry trade seem surprising from the point of view of comparative advantage?
Problems
From earlier chapters you will recall that technological change shifts the average cost curves. Draw a graph showing how technological change could influence intra-industry trade.
Consider two countries: South Korea and Taiwan. Taiwan can produce one million mobile phones per day at the cost of $10 per phone and South Korea can produce 50 million mobile phones at $5 per phone. Assume these phones are the same type and quality and there is only one price. What is the minimum price at which both countries will engage in trade?
References
U.S. Census Bureau. 2015. “U.S. International Trade in Goods and Services: December 2014.” Accessed April 13, 2015. http://www.bea.gov/newsreleases/international/trade/2015/pdf/trad1214.pdf.
U.S. Census Bureau. U.S. Bureau of Economic Analysis. 2015. “U.S. International Trade in Goods and Services February 2015.” Accessed April 10, 2015. https://www.census.gov/foreign-trade/Press-Release/current_press_release/ft900.pdf.
Vernengo, Matias. “What Do Undergraduates Really Need to Know About Trade and Finance?” in Political Economy and Contemporary Capitalism: Radical Perspectives on Economic Theory and Policy, ed. Ron Baiman, Heather Boushey, and Dawn Saunders. M. E. Sharpe Inc, 2000. Armonk. 177-183.
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The Benefits of Reducing Barriers to International Trade
Overview
By the end of this section, you will be able to:
- Explain tarrifs as barriers to trade
- Identify at least two benefits of reducing barriers to international trade
Tariffs are taxes that governments place on imported goods for a variety of reasons. Some of these reasons include protecting sensitive industries, for humanitarian reasons, and protecting against dumping. Traditionally, tariffs were used simply as a political tool to protect certain vested economic, social, and cultural interests. The World Trade Organization (WTO) is committed to lowering barriers to trade. The world’s nations meet through the WTO to negotiate how they can reduce barriers to trade, such as tariffs. WTO negotiations happen in “rounds,” where all countries negotiate one agreement to encourage trade, take a year or two off, and then start negotiating a new agreement. The current round of negotiations is called the Doha Round because it was officially launched in Doha, the capital city of Qatar, in November 2001. In 2009, economists from the World Bank summarized recent research and found that the Doha round of negotiations would increase the size of the world economy by $160 billion to $385 billion per year, depending on the precise deal that ended up being negotiated.
In the context of a global economy that currently produces more than $30 trillion of goods and services each year, this amount is not huge: it is an increase of 1% or less. But before dismissing the gains from trade too quickly, it is worth remembering two points.
- First, a gain of a few hundred billion dollars is enough money to deserve attention! Moreover, remember that this increase is not a one-time event; it would persist each year into the future.
- Second, the estimate of gains may be on the low side because some of the gains from trade are not measured especially well in economic statistics. For example, it is difficult to measure the potential advantages to consumers of having a variety of products available and a greater degree of competition among producers. Perhaps the most important unmeasured factor is that trade between countries, especially when firms are splitting up the value chain of production, often involves a transfer of knowledge that can involve skills in production, technology, management, finance, and law.
Low-income countries benefit more from trade than high-income countries do. In some ways, the giant U.S. economy has less need for international trade, because it can already take advantage of internal trade within its economy. However, many smaller national economies around the world, in regions like Latin America, Africa, the Middle East, and Asia, have much more limited possibilities for trade inside their countries or their immediate regions. Without international trade, they may have little ability to benefit from comparative advantage, slicing up the value chain, or economies of scale. Moreover, smaller economies often have fewer competitive firms making goods within their economy, and thus firms have less pressure from other firms to provide the goods and prices that consumers want.
The economic gains from expanding international trade are measured in hundreds of billions of dollars, and the gains from international trade as a whole probably reach well into the trillions of dollars. The potential for gains from trade may be especially high among the smaller and lower-income countries of the world.
Visit this website for a list of some benefits of trade.
From Interpersonal to International Trade
Most people find it easy to believe that they, personally, would not be better off if they tried to grow and process all of their own food, to make all of their own clothes, to build their own cars and houses from scratch, and so on. Instead, we all benefit from living in economies where people and firms can specialize and trade with each other.
The benefits of trade do not stop at national boundaries, either. Earlier we explained that the division of labor could increase output for three reasons: (1) workers with different characteristics can specialize in the types of production where they have a comparative advantage; (2) firms and workers who specialize in a certain product become more productive with learning and practice; and (3) economies of scale. These three reasons apply from the individual and community level right up to the international level. If it makes sense to you that interpersonal, intercommunity, and interstate trade offer economic gains, it should make sense that international trade offers gains, too.
International trade currently involves about $20 trillion worth of goods and services moving around the globe. Any economic force of that size, even if it confers overall benefits, is certain to cause disruption and controversy. This chapter has only made the case that trade brings economic benefits. Other chapters discuss, in detail, the public policy arguments over whether to restrict international trade.
It’s Apple’s (Global) iPhone
Apple Corporation uses a global platform to produce the iPhone. Now that you understand the concept of comparative advantage, you can see why the engineering and design of the iPhone is done in the United States. The United States has built up a comparative advantage over the years in designing and marketing products, and sacrifices fewer resources to design high-tech devices relative to other countries. China has a comparative advantage in assembling the phone due to its large skilled labor force. Korea has a comparative advantage in producing components. Korea focuses its production by increasing its scale, learning better ways to produce screens and computer chips, and uses innovation to lower average costs of production. Apple, in turn, benefits because it can purchase these quality products at lower prices. Put the global assembly line together and you have the device with which we are all so familiar.
Key Concepts and Summary
Tariffs are placed on imported goods as a way of protecting sensitive industries, for humanitarian reasons, and for protection against dumping. Traditionally, tariffs were used as a political tool to protect certain vested economic, social, and cultural interests. The WTO has been, and continues to be, a way for nations to meet and negotiate in order to reduce barriers to trade. The gains of international trade are very large, especially for smaller countries, but are beneficial to all.
Self-Check Question
If the removal of trade barriers is so beneficial to international economic growth, why would a nation continue to restrict trade on some imported or exported products?
Hint:
A nation might restrict trade on imported products to protect an industry that is important for national security. For example, nation X and nation Y may be geopolitical rivals, each with ambitions of increased political and economic strength. Even if nation Y has comparative advantage in the production of missile defense systems, it is unlikely that nation Y would seek to export those goods to nation X. It is also the case that, for some nations, the production of a particular good is a key component of national identity. In Japan, the production of rice is culturally very important. It may be difficult for Japan to import rice from a nation like Vietnam, even if Vietnam has a comparative advantage in rice production.
Review Question
Are the gains from international trade more likely to be relatively more important to large or small countries?
Critical Thinking Questions
In World Trade Organization meetings, what do you think low-income countries lobby for?
Why might a low-income country put up barriers to trade, such as tariffs on imports?
Can a nation’s comparative advantage change over time? What factors would make it change?
Problems
If trade increases world GDP by 1% per year, what is the global impact of this increase over 10 years? How does this increase compare to the annual GDP of a country like Sri Lanka? Discuss. Hint: To answer this question, here are steps you may want to consider. Go to the World Development Indicators (online) published by the World Bank. Find the current level of World GDP in constant international dollars. Also, find the GDP of Sri Lanka in constant international dollars. Once you have these two numbers, compute the amount the additional increase in global incomes due to trade and compare that number to Sri Lanka’s GDP.
References
World Trade Organization. “The Doha Round.” Accessed October 2013. http://www.wto.org/english/tratop_e/dda_e/dda_e.htm.
The World Bank. “Data: World Development Indicators.” Accessed October 2013. http://data.worldbank.org/data-catalog/world-development-indicators.
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Introduction to Demand and Supply
Why Can We Not Get Enough of Organic?
Organic food is increasingly popular, not just in the United States, but worldwide. At one time, consumers had to go to specialty stores or farmers' markets to find organic produce. Now it is available in most grocery stores. In short, organic is part of the mainstream.
Ever wonder why organic food costs more than conventional food? Why, say, does an organic Fuji apple cost $1.99 a pound, while its conventional counterpart costs $1.49 a pound? The same price relationship is true for just about every organic product on the market. If many organic foods are locally grown, would they not take less time to get to market and therefore be cheaper? What are the forces that keep those prices from coming down? Turns out those forces have quite a bit to do with this chapter’s topic: demand and supply.
Introduction to Demand and Supply
In this chapter, you will learn about:
- Demand, Supply, and Equilibrium in Markets for Goods and Services
- Shifts in Demand and Supply for Goods and Services
- Changes in Equilibrium Price and Quantity: The Four-Step Process
- Price Ceilings and Price Floors
An auction bidder pays thousands of dollars for a dress Whitney Houston wore. A collector spends a small fortune for a few drawings by John Lennon. People usually react to purchases like these in two ways: their jaw drops because they think these are high prices to pay for such goods or they think these are rare, desirable items and the amount paid seems right.
Visit this website to read a list of bizarre items that have been purchased for their ties to celebrities. These examples represent an interesting facet of demand and supply.
When economists talk about prices, they are less interested in making judgments than in gaining a practical understanding of what determines prices and why prices change. Consider a price most of us contend with weekly: that of a gallon of gas. Why was the average price of gasoline in the United States $3.71 per gallon in June 2014? Why did the price for gasoline fall sharply to $1.96 per gallon by January 2016? To explain these price movements, economists focus on the determinants of what gasoline buyers are willing to pay and what gasoline sellers are willing to accept.
As it turns out, the price of gasoline in June of any given year is nearly always higher than the price in January of that same year. Over recent decades, gasoline prices in midsummer have averaged about 10 cents per gallon more than their midwinter low. The likely reason is that people drive more in the summer, and are also willing to pay more for gas, but that does not explain how steeply gas prices fell. Other factors were at work during those 18 months, such as increases in supply and decreases in the demand for crude oil.
This chapter introduces the economic model of demand and supply—one of the most powerful models in all of economics. The discussion here begins by examining how demand and supply determine the price and the quantity sold in markets for goods and services, and how changes in demand and supply lead to changes in prices and quantities.
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Demand, Supply, and Equilibrium in Markets for Goods and Services
Overview
By the end of this section, you will be able to:
- Explain demand, quantity demanded, and the law of demand
- Identify a demand curve and a supply curve
- Explain supply, quantity supplied, and the law of supply
- Explain equilibrium, equilibrium price, and equilibrium quantity
First let’s first focus on what economists mean by demand, what they mean by supply, and then how demand and supply interact in a market.
Demand for Goods and Services
Economists use the term demand to refer to the amount of some good or service consumers are willing and able to purchase at each price. Demand is fundamentally based on needs and wants—if you have no need or want for something, you won't buy it. While a consumer may be able to differentiate between a need and a want, but from an economist’s perspective they are the same thing. Demand is also based on ability to pay. If you cannot pay for it, you have no effective demand. By this definition, a homeless person probably has no effective demand for shelter.
What a buyer pays for a unit of the specific good or service is called price. The total number of units that consumers would purchase at that price is called the quantity demanded. A rise in price of a good or service almost always decreases the quantity demanded of that good or service. Conversely, a fall in price will increase the quantity demanded. When the price of a gallon of gasoline increases, for example, people look for ways to reduce their consumption by combining several errands, commuting by carpool or mass transit, or taking weekend or vacation trips closer to home. Economists call this inverse relationship between price and quantity demanded the law of demand. The law of demand assumes that all other variables that affect demand (which we explain in the next module) are held constant.
We can show an example from the market for gasoline in a table or a graph. Economist call a table that shows the quantity demanded at each price, such as Table, a demand schedule. In this case we measure price in dollars per gallon of gasoline. We measure the quantity demanded in millions of gallons over some time period (for example, per day or per year) and over some geographic area (like a state or a country). A demand curve shows the relationship between price and quantity demanded on a graph like Figure, with quantity on the horizontal axis and the price per gallon on the vertical axis. (Note that this is an exception to the normal rule in mathematics that the independent variable (x) goes on the horizontal axis and the dependent variable (y) goes on the vertical. Economics is not math.)
Table shows the demand schedule and the graph in Figure shows the demand curve. These are two ways to describe the same relationship between price and quantity demanded.
| Price (per gallon) | Quantity Demanded (millions of gallons) |
|---|---|
| $1.00 | 800 |
| $1.20 | 700 |
| $1.40 | 600 |
| $1.60 | 550 |
| $1.80 | 500 |
| $2.00 | 460 |
| $2.20 | 420 |
Demand curves will appear somewhat different for each product. They may appear relatively steep or flat, or they may be straight or curved. Nearly all demand curves share the fundamental similarity that they slope down from left to right. Demand curves embody the law of demand: As the price increases, the quantity demanded decreases, and conversely, as the price decreases, the quantity demanded increases.
Confused about these different types of demand? Read the next Clear It Up feature.
Is demand the same as quantity demanded?
In economic terminology, demand is not the same as quantity demanded. When economists talk about demand, they mean the relationship between a range of prices and the quantities demanded at those prices, as illustrated by a demand curve or a demand schedule. When economists talk about quantity demanded, they mean only a certain point on the demand curve, or one quantity on the demand schedule. In short, demand refers to the curve and quantity demanded refers to the (specific) point on the curve.
Supply of Goods and Services
When economists talk about supply, they mean the amount of some good or service a producer is willing to supply at each price. Price is what the producer receives for selling one unit of a good or service. A rise in price almost always leads to an increase in the quantity supplied of that good or service, while a fall in price will decrease the quantity supplied. When the price of gasoline rises, for example, it encourages profit-seeking firms to take several actions: expand exploration for oil reserves; drill for more oil; invest in more pipelines and oil tankers to bring the oil to plants for refining into gasoline; build new oil refineries; purchase additional pipelines and trucks to ship the gasoline to gas stations; and open more gas stations or keep existing gas stations open longer hours. Economists call this positive relationship between price and quantity supplied—that a higher price leads to a higher quantity supplied and a lower price leads to a lower quantity supplied—the law of supply. The law of supply assumes that all other variables that affect supply (to be explained in the next module) are held constant.
Still unsure about the different types of supply? See the following Clear It Up feature.
Is supply the same as quantity supplied?
In economic terminology, supply is not the same as quantity supplied. When economists refer to supply, they mean the relationship between a range of prices and the quantities supplied at those prices, a relationship that we can illustrate with a supply curve or a supply schedule. When economists refer to quantity supplied, they mean only a certain point on the supply curve, or one quantity on the supply schedule. In short, supply refers to the curve and quantity supplied refers to the (specific) point on the curve.
Figure illustrates the law of supply, again using the market for gasoline as an example. Like demand, we can illustrate supply using a table or a graph. A supply schedule is a table, like Table, that shows the quantity supplied at a range of different prices. Again, we measure price in dollars per gallon of gasoline and we measure quantity supplied in millions of gallons. A supply curve is a graphic illustration of the relationship between price, shown on the vertical axis, and quantity, shown on the horizontal axis. The supply schedule and the supply curve are just two different ways of showing the same information. Notice that the horizontal and vertical axes on the graph for the supply curve are the same as for the demand curve.
| Price (per gallon) | Quantity Supplied (millions of gallons) |
|---|---|
| $1.00 | 500 |
| $1.20 | 550 |
| $1.40 | 600 |
| $1.60 | 640 |
| $1.80 | 680 |
| $2.00 | 700 |
| $2.20 | 720 |
The shape of supply curves will vary somewhat according to the product: steeper, flatter, straighter, or curved. Nearly all supply curves, however, share a basic similarity: they slope up from left to right and illustrate the law of supply: as the price rises, say, from $1.00 per gallon to $2.20 per gallon, the quantity supplied increases from 500 gallons to 720 gallons. Conversely, as the price falls, the quantity supplied decreases.
Equilibrium—Where Demand and Supply Intersect
Because the graphs for demand and supply curves both have price on the vertical axis and quantity on the horizontal axis, the demand curve and supply curve for a particular good or service can appear on the same graph. Together, demand and supply determine the price and the quantity that will be bought and sold in a market.
Figure illustrates the interaction of demand and supply in the market for gasoline. The demand curve (D) is identical to Figure. The supply curve (S) is identical to Figure. Table contains the same information in tabular form.
| Price (per gallon) | Quantity demanded (millions of gallons) | Quantity supplied (millions of gallons) |
|---|---|---|
| $1.00 | 800 | 500 |
| $1.20 | 700 | 550 |
| $1.40 | 600 | 600 |
| $1.60 | 550 | 640 |
| $1.80 | 500 | 680 |
| $2.00 | 460 | 700 |
| $2.20 | 420 | 720 |
Remember this: When two lines on a diagram cross, this intersection usually means something. The point where the supply curve (S) and the demand curve (D) cross, designated by point E in Figure, is called the equilibrium. The equilibrium price is the only price where the plans of consumers and the plans of producers agree—that is, where the amount of the product consumers want to buy (quantity demanded) is equal to the amount producers want to sell (quantity supplied). Economists call this common quantity the equilibrium quantity. At any other price, the quantity demanded does not equal the quantity supplied, so the market is not in equilibrium at that price.
In Figure, the equilibrium price is $1.40 per gallon of gasoline and the equilibrium quantity is 600 million gallons. If you had only the demand and supply schedules, and not the graph, you could find the equilibrium by looking for the price level on the tables where the quantity demanded and the quantity supplied are equal.
The word “equilibrium” means “balance.” If a market is at its equilibrium price and quantity, then it has no reason to move away from that point. However, if a market is not at equilibrium, then economic pressures arise to move the market toward the equilibrium price and the equilibrium quantity.
Imagine, for example, that the price of a gallon of gasoline was above the equilibrium price—that is, instead of $1.40 per gallon, the price is $1.80 per gallon. The dashed horizontal line at the price of $1.80 in Figure illustrates this above equilibrium price. At this higher price, the quantity demanded drops from 600 to 500. This decline in quantity reflects how consumers react to the higher price by finding ways to use less gasoline.
Moreover, at this higher price of $1.80, the quantity of gasoline supplied rises from the 600 to 680, as the higher price makes it more profitable for gasoline producers to expand their output. Now, consider how quantity demanded and quantity supplied are related at this above-equilibrium price. Quantity demanded has fallen to 500 gallons, while quantity supplied has risen to 680 gallons. In fact, at any above-equilibrium price, the quantity supplied exceeds the quantity demanded. We call this an excess supply or a surplus.
With a surplus, gasoline accumulates at gas stations, in tanker trucks, in pipelines, and at oil refineries. This accumulation puts pressure on gasoline sellers. If a surplus remains unsold, those firms involved in making and selling gasoline are not receiving enough cash to pay their workers and to cover their expenses. In this situation, some producers and sellers will want to cut prices, because it is better to sell at a lower price than not to sell at all. Once some sellers start cutting prices, others will follow to avoid losing sales. These price reductions in turn will stimulate a higher quantity demanded. Therefore, if the price is above the equilibrium level, incentives built into the structure of demand and supply will create pressures for the price to fall toward the equilibrium.
Now suppose that the price is below its equilibrium level at $1.20 per gallon, as the dashed horizontal line at this price in Figure shows. At this lower price, the quantity demanded increases from 600 to 700 as drivers take longer trips, spend more minutes warming up the car in the driveway in wintertime, stop sharing rides to work, and buy larger cars that get fewer miles to the gallon. However, the below-equilibrium price reduces gasoline producers’ incentives to produce and sell gasoline, and the quantity supplied falls from 600 to 550.
When the price is below equilibrium, there is excess demand, or a shortage—that is, at the given price the quantity demanded, which has been stimulated by the lower price, now exceeds the quantity supplied, which had been depressed by the lower price. In this situation, eager gasoline buyers mob the gas stations, only to find many stations running short of fuel. Oil companies and gas stations recognize that they have an opportunity to make higher profits by selling what gasoline they have at a higher price. As a result, the price rises toward the equilibrium level. Read Demand, Supply, and Efficiency for more discussion on the importance of the demand and supply model.
Key Concepts and Summary
A demand schedule is a table that shows the quantity demanded at different prices in the market. A demand curve shows the relationship between quantity demanded and price in a given market on a graph. The law of demand states that a higher price typically leads to a lower quantity demanded.
A supply schedule is a table that shows the quantity supplied at different prices in the market. A supply curve shows the relationship between quantity supplied and price on a graph. The law of supply says that a higher price typically leads to a higher quantity supplied.
The equilibrium price and equilibrium quantity occur where the supply and demand curves cross. The equilibrium occurs where the quantity demanded is equal to the quantity supplied. If the price is below the equilibrium level, then the quantity demanded will exceed the quantity supplied. Excess demand or a shortage will exist. If the price is above the equilibrium level, then the quantity supplied will exceed the quantity demanded. Excess supply or a surplus will exist. In either case, economic pressures will push the price toward the equilibrium level.
Self-Check Question
Review Figure. Suppose the price of gasoline is $1.60 per gallon. Is the quantity demanded higher or lower than at the equilibrium price of $1.40 per gallon? What about the quantity supplied? Is there a shortage or a surplus in the market? If so, how much?
Hint:
Since $1.60 per gallon is above the equilibrium price, the quantity demanded would be lower at 550 gallons and the quantity supplied would be higher at 640 gallons. (These results are due to the laws of demand and supply, respectively.) The outcome of lower Qd and higher Qs would be a surplus in the gasoline market of 640 – 550 = 90 gallons.
Review Questions
What determines the level of prices in a market?
What does a downward-sloping demand curve mean about how buyers in a market will react to a higher price?
Will demand curves have the same exact shape in all markets? If not, how will they differ?
Will supply curves have the same shape in all markets? If not, how will they differ?
What is the relationship between quantity demanded and quantity supplied at equilibrium? What is the relationship when there is a shortage? What is the relationship when there is a surplus?
How can you locate the equilibrium point on a demand and supply graph?
If the price is above the equilibrium level, would you predict a surplus or a shortage? If the price is below the equilibrium level, would you predict a surplus or a shortage? Why?
When the price is above the equilibrium, explain how market forces move the market price to equilibrium. Do the same when the price is below the equilibrium.
What is the difference between the demand and the quantity demanded of a product, say milk? Explain in words and show the difference on a graph with a demand curve for milk.
What is the difference between the supply and the quantity supplied of a product, say milk? Explain in words and show the difference on a graph with the supply curve for milk.
Critical Thinking Questions
Review Figure. Suppose the government decided that, since gasoline is a necessity, its price should be legally capped at $1.30 per gallon. What do you anticipate would be the outcome in the gasoline market?
Explain why the following statement is false: “In the goods market, no buyer would be willing to pay more than the equilibrium price.”
Explain why the following statement is false: “In the goods market, no seller would be willing to sell for less than the equilibrium price.”
Problems
Review Figure again. Suppose the price of gasoline is $1.00. Will the quantity demanded be lower or higher than at the equilibrium price of $1.40 per gallon? Will the quantity supplied be lower or higher? Is there a shortage or a surplus in the market? If so, of how much?
References
Costanza, Robert, and Lisa Wainger. “No Accounting For Nature: How Conventional Economics Distorts the Value of Things.” The Washington Post. September 2, 1990.
European Commission: Agriculture and Rural Development. 2013. "Overview of the CAP Reform: 2014-2024." Accessed April 13, 205. http://ec.europa.eu/agriculture/cap-post-2013/.
Radford, R. A. “The Economic Organisation of a P.O.W. Camp.” Economica. no. 48 (1945): 189-201. http://www.jstor.org/stable/2550133.
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Shifts in Demand and Supply for Goods and Services
Overview
By the end of this section, you will be able to:
- Identify factors that affect demand
- Graph demand curves and demand shifts
- Identify factors that affect supply
- Graph supply curves and supply shifts
The previous module explored how price affects the quantity demanded and the quantity supplied. The result was the demand curve and the supply curve. Price, however, is not the only factor that influences demand, nor is it the only thing that influences supply. For example, how is demand for vegetarian food affected if, say, health concerns cause more consumers to avoid eating meat? How is the supply of diamonds affected if diamond producers discover several new diamond mines? What are the major factors, in addition to the price, that influence demand or supply?
Visit this website to read a brief note on how marketing strategies can influence supply and demand of products.
What Factors Affect Demand?
We defined demand as the amount of some product a consumer is willing and able to purchase at each price. That suggests at least two factors in addition to price that affect demand. Willingness to purchase suggests a desire, based on what economists call tastes and preferences. If you neither need nor want something, you will not buy it. Ability to purchase suggests that income is important. Professors are usually able to afford better housing and transportation than students, because they have more income. Prices of related goods can affect demand also. If you need a new car, the price of a Honda may affect your demand for a Ford. Finally, the size or composition of the population can affect demand. The more children a family has, the greater their demand for clothing. The more driving-age children a family has, the greater their demand for car insurance, and the less for diapers and baby formula.
These factors matter for both individual and market demand as a whole. Exactly how do these various factors affect demand, and how do we show the effects graphically? To answer those questions, we need the ceteris paribus assumption.
The Ceteris Paribus Assumption
A demand curve or a supply curve is a relationship between two, and only two, variables: quantity on the horizontal axis and price on the vertical axis. The assumption behind a demand curve or a supply curve is that no relevant economic factors, other than the product’s price, are changing. Economists call this assumption ceteris paribus, a Latin phrase meaning “other things being equal.” Any given demand or supply curve is based on the ceteris paribus assumption that all else is held equal. A demand curve or a supply curve is a relationship between two, and only two, variables when all other variables are kept constant. If all else is not held equal, then the laws of supply and demand will not necessarily hold, as the following Clear It Up feature shows.
When does ceteris paribus apply?
We typically apply ceteris paribus when we observe how changes in price affect demand or supply, but we can apply ceteris paribus more generally. In the real world, demand and supply depend on more factors than just price. For example, a consumer’s demand depends on income and a producer’s supply depends on the cost of producing the product. How can we analyze the effect on demand or supply if multiple factors are changing at the same time—say price rises and income falls? The answer is that we examine the changes one at a time, assuming the other factors are held constant.
For example, we can say that an increase in the price reduces the amount consumers will buy (assuming income, and anything else that affects demand, is unchanged). Additionally, a decrease in income reduces the amount consumers can afford to buy (assuming price, and anything else that affects demand, is unchanged). This is what the ceteris paribus assumption really means. In this particular case, after we analyze each factor separately, we can combine the results. The amount consumers buy falls for two reasons: first because of the higher price and second because of the lower income.
How Does Income Affect Demand?
Let’s use income as an example of how factors other than price affect demand. Figure shows the initial demand for automobiles as D0. At point Q, for example, if the price is $20,000 per car, the quantity of cars demanded is 18 million. D0 also shows how the quantity of cars demanded would change as a result of a higher or lower price. For example, if the price of a car rose to $22,000, the quantity demanded would decrease to 17 million, at point R.
The original demand curve D0, like every demand curve, is based on the ceteris paribus assumption that no other economically relevant factors change. Now imagine that the economy expands in a way that raises the incomes of many people, making cars more affordable. How will this affect demand? How can we show this graphically?
Return to Figure. The price of cars is still $20,000, but with higher incomes, the quantity demanded has now increased to 20 million cars, shown at point S. As a result of the higher income levels, the demand curve shifts to the right to the new demand curve D1, indicating an increase in demand. Table shows clearly that this increased demand would occur at every price, not just the original one.
| Price | Decrease to D2 | Original Quantity Demanded D0 | Increase to D1 |
|---|---|---|---|
| $16,000 | 17.6 million | 22.0 million | 24.0 million |
| $18,000 | 16.0 million | 20.0 million | 22.0 million |
| $20,000 | 14.4 million | 18.0 million | 20.0 million |
| $22,000 | 13.6 million | 17.0 million | 19.0 million |
| $24,000 | 13.2 million | 16.5 million | 18.5 million |
| $26,000 | 12.8 million | 16.0 million | 18.0 million |
Now, imagine that the economy slows down so that many people lose their jobs or work fewer hours, reducing their incomes. In this case, the decrease in income would lead to a lower quantity of cars demanded at every given price, and the original demand curve D0 would shift left to D2. The shift from D0 to D2 represents such a decrease in demand: At any given price level, the quantity demanded is now lower. In this example, a price of $20,000 means 18 million cars sold along the original demand curve, but only 14.4 million sold after demand fell.
When a demand curve shifts, it does not mean that the quantity demanded by every individual buyer changes by the same amount. In this example, not everyone would have higher or lower income and not everyone would buy or not buy an additional car. Instead, a shift in a demand curve captures a pattern for the market as a whole.
In the previous section, we argued that higher income causes greater demand at every price. This is true for most goods and services. For some—luxury cars, vacations in Europe, and fine jewelry—the effect of a rise in income can be especially pronounced. A product whose demand rises when income rises, and vice versa, is called a normal good. A few exceptions to this pattern do exist. As incomes rise, many people will buy fewer generic brand groceries and more name brand groceries. They are less likely to buy used cars and more likely to buy new cars. They will be less likely to rent an apartment and more likely to own a home. A product whose demand falls when income rises, and vice versa, is called an inferior good. In other words, when income increases, the demand curve shifts to the left.
Other Factors That Shift Demand Curves
Income is not the only factor that causes a shift in demand. Other factors that change demand include tastes and preferences, the composition or size of the population, the prices of related goods, and even expectations. A change in any one of the underlying factors that determine what quantity people are willing to buy at a given price will cause a shift in demand. Graphically, the new demand curve lies either to the right (an increase) or to the left (a decrease) of the original demand curve. Let’s look at these factors.
Changing Tastes or Preferences
From 1980 to 2014, the per-person consumption of chicken by Americans rose from 48 pounds per year to 85 pounds per year, and consumption of beef fell from 77 pounds per year to 54 pounds per year, according to the U.S. Department of Agriculture (USDA). Changes like these are largely due to movements in taste, which change the quantity of a good demanded at every price: that is, they shift the demand curve for that good, rightward for chicken and leftward for beef.
Changes in the Composition of the Population
The proportion of elderly citizens in the United States population is rising. It rose from 9.8% in 1970 to 12.6% in 2000, and will be a projected (by the U.S. Census Bureau) 20% of the population by 2030. A society with relatively more children, like the United States in the 1960s, will have greater demand for goods and services like tricycles and day care facilities. A society with relatively more elderly persons, as the United States is projected to have by 2030, has a higher demand for nursing homes and hearing aids. Similarly, changes in the size of the population can affect the demand for housing and many other goods. Each of these changes in demand will be shown as a shift in the demand curve.
Changes in the prices of related goods such as substitutes or complements also can affect the demand for a product. A substitute is a good or service that we can use in place of another good or service. As electronic books, like this one, become more available, you would expect to see a decrease in demand for traditional printed books. A lower price for a substitute decreases demand for the other product. For example, in recent years as the price of tablet computers has fallen, the quantity demanded has increased (because of the law of demand). Since people are purchasing tablets, there has been a decrease in demand for laptops, which we can show graphically as a leftward shift in the demand curve for laptops. A higher price for a substitute good has the reverse effect.
Other goods are complements for each other, meaning we often use the goods together, because consumption of one good tends to enhance consumption of the other. Examples include breakfast cereal and milk; notebooks and pens or pencils, golf balls and golf clubs; gasoline and sport utility vehicles; and the five-way combination of bacon, lettuce, tomato, mayonnaise, and bread. If the price of golf clubs rises, since the quantity demanded of golf clubs falls (because of the law of demand), demand for a complement good like golf balls decreases, too. Similarly, a higher price for skis would shift the demand curve for a complement good like ski resort trips to the left, while a lower price for a complement has the reverse effect.
Changes in Expectations about Future Prices or Other Factors that Affect Demand
While it is clear that the price of a good affects the quantity demanded, it is also true that expectations about the future price (or expectations about tastes and preferences, income, and so on) can affect demand. For example, if people hear that a hurricane is coming, they may rush to the store to buy flashlight batteries and bottled water. If people learn that the price of a good like coffee is likely to rise in the future, they may head for the store to stock up on coffee now. We show these changes in demand as shifts in the curve. Therefore, a shift in demand happens when a change in some economic factor (other than price) causes a different quantity to be demanded at every price. The following Work It Out feature shows how this happens.
Shift in Demand
A shift in demand means that at any price (and at every price), the quantity demanded will be different than it was before. Following is an example of a shift in demand due to an income increase.
Step 1. Draw the graph of a demand curve for a normal good like pizza. Pick a price (like P0). Identify the corresponding Q0. See an example in Figure.
Step 2. Suppose income increases. As a result of the change, are consumers going to buy more or less pizza? The answer is more. Draw a dotted horizontal line from the chosen price, through the original quantity demanded, to the new point with the new Q1. Draw a dotted vertical line down to the horizontal axis and label the new Q1. Figure provides an example.
Step 3. Now, shift the curve through the new point. You will see that an increase in income causes an upward (or rightward) shift in the demand curve, so that at any price the quantities demanded will be higher, as Figure illustrates.
Summing Up Factors That Change Demand
Figure summarizes six factors that can shift demand curves. The direction of the arrows indicates whether the demand curve shifts represent an increase in demand or a decrease in demand. Notice that a change in the price of the good or service itself is not listed among the factors that can shift a demand curve. A change in the price of a good or service causes a movement along a specific demand curve, and it typically leads to some change in the quantity demanded, but it does not shift the demand curve.
When a demand curve shifts, it will then intersect with a given supply curve at a different equilibrium price and quantity. We are, however, getting ahead of our story. Before discussing how changes in demand can affect equilibrium price and quantity, we first need to discuss shifts in supply curves.
How Production Costs Affect Supply
A supply curve shows how quantity supplied will change as the price rises and falls, assuming ceteris paribus so that no other economically relevant factors are changing. If other factors relevant to supply do change, then the entire supply curve will shift. Just as we described a shift in demand as a change in the quantity demanded at every price, a shift in supply means a change in the quantity supplied at every price.
In thinking about the factors that affect supply, remember what motivates firms: profits, which are the difference between revenues and costs. A firm produces goods and services using combinations of labor, materials, and machinery, or what we call inputs or factors of production. If a firm faces lower costs of production, while the prices for the good or service the firm produces remain unchanged, a firm’s profits go up. When a firm’s profits increase, it is more motivated to produce output, since the more it produces the more profit it will earn. When costs of production fall, a firm will tend to supply a larger quantity at any given price for its output. We can show this by the supply curve shifting to the right.
Take, for example, a messenger company that delivers packages around a city. The company may find that buying gasoline is one of its main costs. If the price of gasoline falls, then the company will find it can deliver messages more cheaply than before. Since lower costs correspond to higher profits, the messenger company may now supply more of its services at any given price. For example, given the lower gasoline prices, the company can now serve a greater area, and increase its supply.
Conversely, if a firm faces higher costs of production, then it will earn lower profits at any given selling price for its products. As a result, a higher cost of production typically causes a firm to supply a smaller quantity at any given price. In this case, the supply curve shifts to the left.
Consider the supply for cars, shown by curve S0 in Figure. Point J indicates that if the price is $20,000, the quantity supplied will be 18 million cars. If the price rises to $22,000 per car, ceteris paribus, the quantity supplied will rise to 20 million cars, as point K on the S0 curve shows. We can show the same information in table form, as in Table.
| Price | Decrease to S1 | Original Quantity Supplied S0 | Increase to S2 |
|---|---|---|---|
| $16,000 | 10.5 million | 12.0 million | 13.2 million |
| $18,000 | 13.5 million | 15.0 million | 16.5 million |
| $20,000 | 16.5 million | 18.0 million | 19.8 million |
| $22,000 | 18.5 million | 20.0 million | 22.0 million |
| $24,000 | 19.5 million | 21.0 million | 23.1 million |
| $26,000 | 20.5 million | 22.0 million | 24.2 million |
Now, imagine that the price of steel, an important ingredient in manufacturing cars, rises, so that producing a car has become more expensive. At any given price for selling cars, car manufacturers will react by supplying a lower quantity. We can show this graphically as a leftward shift of supply, from S0 to S1, which indicates that at any given price, the quantity supplied decreases. In this example, at a price of $20,000, the quantity supplied decreases from 18 million on the original supply curve (S0) to 16.5 million on the supply curve S1, which is labeled as point L.
Conversely, if the price of steel decreases, producing a car becomes less expensive. At any given price for selling cars, car manufacturers can now expect to earn higher profits, so they will supply a higher quantity. The shift of supply to the right, from S0 to S2, means that at all prices, the quantity supplied has increased. In this example, at a price of $20,000, the quantity supplied increases from 18 million on the original supply curve (S0) to 19.8 million on the supply curve S2, which is labeled M.
Other Factors That Affect Supply
In the example above, we saw that changes in the prices of inputs in the production process will affect the cost of production and thus the supply. Several other things affect the cost of production, too, such as changes in weather or other natural conditions, new technologies for production, and some government policies.
Changes in weather and climate will affect the cost of production for many agricultural products. For example, in 2014 the Manchurian Plain in Northeastern China, which produces most of the country's wheat, corn, and soybeans, experienced its most severe drought in 50 years. A drought decreases the supply of agricultural products, which means that at any given price, a lower quantity will be supplied. Conversely, especially good weather would shift the supply curve to the right.
When a firm discovers a new technology that allows the firm to produce at a lower cost, the supply curve will shift to the right, as well. For instance, in the 1960s a major scientific effort nicknamed the Green Revolution focused on breeding improved seeds for basic crops like wheat and rice. By the early 1990s, more than two-thirds of the wheat and rice in low-income countries around the world used these Green Revolution seeds—and the harvest was twice as high per acre. A technological improvement that reduces costs of production will shift supply to the right, so that a greater quantity will be produced at any given price.
Government policies can affect the cost of production and the supply curve through taxes, regulations, and subsidies. For example, the U.S. government imposes a tax on alcoholic beverages that collects about $8 billion per year from producers. Businesses treat taxes as costs. Higher costs decrease supply for the reasons we discussed above. Other examples of policy that can affect cost are the wide array of government regulations that require firms to spend money to provide a cleaner environment or a safer workplace. Complying with regulations increases costs.
A government subsidy, on the other hand, is the opposite of a tax. A subsidy occurs when the government pays a firm directly or reduces the firm’s taxes if the firm carries out certain actions. From the firm’s perspective, taxes or regulations are an additional cost of production that shifts supply to the left, leading the firm to produce a lower quantity at every given price. Government subsidies reduce the cost of production and increase supply at every given price, shifting supply to the right. The following Work It Out feature shows how this shift happens.
Shift in Supply
We know that a supply curve shows the minimum price a firm will accept to produce a given quantity of output. What happens to the supply curve when the cost of production goes up? Following is an example of a shift in supply due to a production cost increase.
Step 1. Draw a graph of a supply curve for pizza. Pick a quantity (like Q0). If you draw a vertical line up from Q0 to the supply curve, you will see the price the firm chooses. Figure provides an example.
Step 2. Why did the firm choose that price and not some other? One way to think about this is that the price is composed of two parts. The first part is the cost of producing pizzas at the margin; in this case, the cost of producing the pizza, including cost of ingredients (e.g., dough, sauce, cheese, and pepperoni), the cost of the pizza oven, the shop rent, and the workers' wages. The second part is the firm’s desired profit, which is determined, among other factors, by the profit margins in that particular business. If you add these two parts together, you get the price the firm wishes to charge. The quantity Q0 and associated price P0 give you one point on the firm’s supply curve, as Figure illustrates.
Step 3. Now, suppose that the cost of production increases. Perhaps cheese has become more expensive by $0.75 per pizza. If that is true, the firm will want to raise its price by the amount of the increase in cost ($0.75). Draw this point on the supply curve directly above the initial point on the curve, but $0.75 higher, as Figure shows.
Step 4. Shift the supply curve through this point. You will see that an increase in cost causes an upward (or a leftward) shift of the supply curve so that at any price, the quantities supplied will be smaller, as Figure illustrates.
Summing Up Factors That Change Supply
Changes in the cost of inputs, natural disasters, new technologies, and the impact of government decisions all affect the cost of production. In turn, these factors affect how much firms are willing to supply at any given price.
Figure summarizes factors that change the supply of goods and services. Notice that a change in the price of the product itself is not among the factors that shift the supply curve. Although a change in price of a good or service typically causes a change in quantity supplied or a movement along the supply curve for that specific good or service, it does not cause the supply curve itself to shift.
Because demand and supply curves appear on a two-dimensional diagram with only price and quantity on the axes, an unwary visitor to the land of economics might be fooled into believing that economics is about only four topics: demand, supply, price, and quantity. However, demand and supply are really “umbrella” concepts: demand covers all the factors that affect demand, and supply covers all the factors that affect supply. We include factors other than price that affect demand and supply are included by using shifts in the demand or the supply curve. In this way, the two-dimensional demand and supply model becomes a powerful tool for analyzing a wide range of economic circumstances.
Key Concepts and Summary
Economists often use the ceteris paribus or “other things being equal” assumption: while examining the economic impact of one event, all other factors remain unchanged for analysis purposes. Factors that can shift the demand curve for goods and services, causing a different quantity to be demanded at any given price, include changes in tastes, population, income, prices of substitute or complement goods, and expectations about future conditions and prices. Factors that can shift the supply curve for goods and services, causing a different quantity to be supplied at any given price, include input prices, natural conditions, changes in technology, and government taxes, regulations, or subsidies.
Self-Check Questions
Why do economists use the ceteris paribus assumption?
Hint:
To make it easier to analyze complex problems. Ceteris paribus allows you to look at the effect of one factor at a time on what it is you are trying to analyze. When you have analyzed all the factors individually, you add the results together to get the final answer.
In an analysis of the market for paint, an economist discovers the facts listed below. State whether each of these changes will affect supply or demand, and in what direction.
- There have recently been some important cost-saving inventions in the technology for making paint.
- Paint is lasting longer, so that property owners need not repaint as often.
- Because of severe hailstorms, many people need to repaint now.
- The hailstorms damaged several factories that make paint, forcing them to close down for several months.
Hint:
- An improvement in technology that reduces the cost of production will cause an increase in supply. Alternatively, you can think of this as a reduction in price necessary for firms to supply any quantity. Either way, this can be shown as a rightward (or downward) shift in the supply curve.
- An improvement in product quality is treated as an increase in tastes or preferences, meaning consumers demand more paint at any price level, so demand increases or shifts to the right. If this seems counterintuitive, note that demand in the future for the longer-lasting paint will fall, since consumers are essentially shifting demand from the future to the present.
- An increase in need causes an increase in demand or a rightward shift in the demand curve.
- Factory damage means that firms are unable to supply as much in the present. Technically, this is an increase in the cost of production. Either way you look at it, the supply curve shifts to the left.
Many changes are affecting the market for oil. Predict how each of the following events will affect the equilibrium price and quantity in the market for oil. In each case, state how the event will affect the supply and demand diagram. Create a sketch of the diagram if necessary.
- Cars are becoming more fuel efficient, and therefore get more miles to the gallon.
- The winter is exceptionally cold.
- A major discovery of new oil is made off the coast of Norway.
- The economies of some major oil-using nations, like Japan, slow down.
- A war in the Middle East disrupts oil-pumping schedules.
- Landlords install additional insulation in buildings.
- The price of solar energy falls dramatically.
- Chemical companies invent a new, popular kind of plastic made from oil.
Hint:
- More fuel-efficient cars means there is less need for gasoline. This causes a leftward shift in the demand for gasoline and thus oil. Since the demand curve is shifting down the supply curve, the equilibrium price and quantity both fall.
- Cold weather increases the need for heating oil. This causes a rightward shift in the demand for heating oil and thus oil. Since the demand curve is shifting up the supply curve, the equilibrium price and quantity both rise.
- A discovery of new oil will make oil more abundant. This can be shown as a rightward shift in the supply curve, which will cause a decrease in the equilibrium price along with an increase in the equilibrium quantity. (The supply curve shifts down the demand curve so price and quantity follow the law of demand. If price goes down, then the quantity goes up.)
- When an economy slows down, it produces less output and demands less input, including energy, which is used in the production of virtually everything. A decrease in demand for energy will be reflected as a decrease in the demand for oil, or a leftward shift in demand for oil. Since the demand curve is shifting down the supply curve, both the equilibrium price and quantity of oil will fall.
- Disruption of oil pumping will reduce the supply of oil. This leftward shift in the supply curve will show a movement up the demand curve, resulting in an increase in the equilibrium price of oil and a decrease in the equilibrium quantity.
- Increased insulation will decrease the demand for heating. This leftward shift in the demand for oil causes a movement down the supply curve, resulting in a decrease in the equilibrium price and quantity of oil.
- Solar energy is a substitute for oil-based energy. So if solar energy becomes cheaper, the demand for oil will decrease as consumers switch from oil to solar. The decrease in demand for oil will be shown as a leftward shift in the demand curve. As the demand curve shifts down the supply curve, both equilibrium price and quantity for oil will fall.
- A new, popular kind of plastic will increase the demand for oil. The increase in demand will be shown as a rightward shift in demand, raising the equilibrium price and quantity of oil.
Review Questions
When analyzing a market, how do economists deal with the problem that many factors that affect the market are changing at the same time?
Name some factors that can cause a shift in the demand curve in markets for goods and services.
Name some factors that can cause a shift in the supply curve in markets for goods and services.
Critical Thinking Questions
Consider the demand for hamburgers. If the price of a substitute good (for example, hot dogs) increases and the price of a complement good (for example, hamburger buns) increases, can you tell for sure what will happen to the demand for hamburgers? Why or why not? Illustrate your answer with a graph.
How do you suppose the demographics of an aging population of “Baby Boomers” in the United States will affect the demand for milk? Justify your answer.
We know that a change in the price of a product causes a movement along the demand curve. Suppose consumers believe that prices will be rising in the future. How will that affect demand for the product in the present? Can you show this graphically?
Suppose there is a soda tax to curb obesity. What should a reduction in the soda tax do to the supply of sodas and to the equilibrium price and quantity? Can you show this graphically? Hint: Assume that the soda tax is collected from the sellers.
Problems
Table shows information on the demand and supply for bicycles, where the quantities of bicycles are measured in thousands.
| Price | Qd | Qs |
|---|---|---|
| $120 | 50 | 36 |
| $150 | 40 | 40 |
| $180 | 32 | 48 |
| $210 | 28 | 56 |
| $240 | 24 | 70 |
- What is the quantity demanded and the quantity supplied at a price of $210?
- At what price is the quantity supplied equal to 48,000?
- Graph the demand and supply curve for bicycles. How can you determine the equilibrium price and quantity from the graph? How can you determine the equilibrium price and quantity from the table? What are the equilibrium price and equilibrium quantity?
- If the price was $120, what would the quantities demanded and supplied be? Would a shortage or surplus exist? If so, how large would the shortage or surplus be?
The computer market in recent years has seen many more computers sell at much lower prices. What shift in demand or supply is most likely to explain this outcome? Sketch a demand and supply diagram and explain your reasoning for each.
- A rise in demand
- A fall in demand
- A rise in supply
- A fall in supply
References
Landsburg, Steven E. The Armchair Economist: Economics and Everyday Life. New York: The Free Press. 2012. specifically Section IV: How Markets Work.
National Chicken Council. 2015. "Per Capita Consumption of Poultry and Livestock, 1965 to Estimated 2015, in Pounds." Accessed April 13, 2015. http://www.nationalchickencouncil.org/about-the-industry/statistics/per-capita-consumption-of-poultry-and-livestock-1965-to-estimated-2012-in-pounds/.
Wessel, David. “Saudi Arabia Fears $40-a-Barrel Oil, Too.” The Wall Street Journal. May 27, 2004, p. 42. http://online.wsj.com/news/articles/SB108561000087822300.
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Changes in Equilibrium Price and Quantity: The Four-Step Process
Overview
By the end of this section, you will be able to:
- Identify equilibrium price and quantity through the four-step process
- Graph equilibrium price and quantity
- Contrast shifts of demand or supply and movements along a demand or supply curve
- Graph demand and supply curves, including equilibrium price and quantity, based on real-world examples
Let’s begin this discussion with a single economic event. It might be an event that affects demand, like a change in income, population, tastes, prices of substitutes or complements, or expectations about future prices. It might be an event that affects supply, like a change in natural conditions, input prices, or technology, or government policies that affect production. How does this economic event affect equilibrium price and quantity? We will analyze this question using a four-step process.
Step 1. Draw a demand and supply model before the economic change took place. To establish the model requires four standard pieces of information: The law of demand, which tells us the slope of the demand curve; the law of supply, which gives us the slope of the supply curve; the shift variables for demand; and the shift variables for supply. From this model, find the initial equilibrium values for price and quantity.
Step 2. Decide whether the economic change you are analyzing affects demand or supply. In other words, does the event refer to something in the list of demand factors or supply factors?
Step 3. Decide whether the effect on demand or supply causes the curve to shift to the right or to the left, and sketch the new demand or supply curve on the diagram. In other words, does the event increase or decrease the amount consumers want to buy or producers want to sell?
Step 4. Identify the new equilibrium and then compare the original equilibrium price and quantity to the new equilibrium price and quantity.
Let’s consider one example that involves a shift in supply and one that involves a shift in demand. Then we will consider an example where both supply and demand shift.
Good Weather for Salmon Fishing
Supposed that during the summer of 2015, weather conditions were excellent for commercial salmon fishing off the California coast. Heavy rains meant higher than normal levels of water in the rivers, which helps the salmon to breed. Slightly cooler ocean temperatures stimulated the growth of plankton, the microscopic organisms at the bottom of the ocean food chain, providing everything in the ocean with a hearty food supply. The ocean stayed calm during fishing season, so commercial fishing operations did not lose many days to bad weather. How did these climate conditions affect the quantity and price of salmon? Figure illustrates the four-step approach, which we explain below, to work through this problem. Table also provides the information to work the problem.
| Price per Pound | Quantity Supplied in 2014 | Quantity Supplied in 2015 | Quantity Demanded |
|---|---|---|---|
| $2.00 | 80 | 400 | 840 |
| $2.25 | 120 | 480 | 680 |
| $2.50 | 160 | 550 | 550 |
| $2.75 | 200 | 600 | 450 |
| $3.00 | 230 | 640 | 350 |
| $3.25 | 250 | 670 | 250 |
| $3.50 | 270 | 700 | 200 |
Step 1. Draw a demand and supply model to illustrate the market for salmon in the year before the good weather conditions began. The demand curve D0 and the supply curve S0 show that the original equilibrium price is $3.25 per pound and the original equilibrium quantity is 250,000 fish. (This price per pound is what commercial buyers pay at the fishing docks. What consumers pay at the grocery is higher.)
Step 2. Did the economic event affect supply or demand? Good weather is an example of a natural condition that affects supply.
Step 3. Was the effect on supply an increase or a decrease? Good weather is a change in natural conditions that increases the quantity supplied at any given price. The supply curve shifts to the right, moving from the original supply curve S0 to the new supply curve S1, which Figure and Table show.
Step 4. Compare the new equilibrium price and quantity to the original equilibrium. At the new equilibrium E1, the equilibrium price falls from $3.25 to $2.50, but the equilibrium quantity increases from 250,000 to 550,000 salmon. Notice that the equilibrium quantity demanded increased, even though the demand curve did not move.
In short, good weather conditions increased supply of the California commercial salmon. The result was a higher equilibrium quantity of salmon bought and sold in the market at a lower price.
Newspapers and the Internet
According to the Pew Research Center for People and the Press, increasingly more people, especially younger people, are obtaining their news from online and digital sources. The majority of U.S. adults now own smartphones or tablets, and most of those Americans say they use them in part to access the news. From 2004 to 2012, the share of Americans who reported obtaining their news from digital sources increased from 24% to 39%. How has this affected consumption of print news media, and radio and television news? Figure and the text below illustrates using the four-step analysis to answer this question.
Step 1. Develop a demand and supply model to think about what the market looked like before the event. The demand curve D0 and the supply curve S0 show the original relationships. In this case, we perform the analysis without specific numbers on the price and quantity axis.
Step 2. Did the described change affect supply or demand? A change in tastes, from traditional news sources (print, radio, and television) to digital sources, caused a change in demand for the former.
Step 3. Was the effect on demand positive or negative? A shift to digital news sources will tend to mean a lower quantity demanded of traditional news sources at every given price, causing the demand curve for print and other traditional news sources to shift to the left, from D0 to D1.
Step 4. Compare the new equilibrium price and quantity to the original equilibrium price. The new equilibrium (E1) occurs at a lower quantity and a lower price than the original equilibrium (E0).
The decline in print news reading predates 2004. Print newspaper circulation peaked in 1973 and has declined since then due to competition from television and radio news. In 1991, 55% of Americans indicated they received their news from print sources, while only 29% did so in 2012. Radio news has followed a similar path in recent decades, with the share of Americans obtaining their news from radio declining from 54% in 1991 to 33% in 2012. Television news has held its own over the last 15 years, with a market share staying in the mid to upper fifties. What does this suggest for the future, given that two-thirds of Americans under 30 years old say they do not obtain their news from television at all?
The Interconnections and Speed of Adjustment in Real Markets
In the real world, many factors that affect demand and supply can change all at once. For example, the demand for cars might increase because of rising incomes and population, and it might decrease because of rising gasoline prices (a complementary good). Likewise, the supply of cars might increase because of innovative new technologies that reduce the cost of car production, and it might decrease as a result of new government regulations requiring the installation of costly pollution-control technology.
Moreover, rising incomes and population or changes in gasoline prices will affect many markets, not just cars. How can an economist sort out all these interconnected events? The answer lies in the ceteris paribus assumption. Look at how each economic event affects each market, one event at a time, holding all else constant. Then combine the analyses to see the net effect.
A Combined Example
The U.S. Postal Service is facing difficult challenges. Compensation for postal workers tends to increase most years due to cost-of-living increases. At the same time, increasingly more people are using email, text, and other digital message forms such as Facebook and Twitter to communicate with friends and others. What does this suggest about the continued viability of the Postal Service? Figure and the text below illustrate this using the four-step analysis to answer this question.
Since this problem involves two disturbances, we need two four-step analyses, the first to analyze the effects of higher compensation for postal workers, the second to analyze the effects of many people switching from “snail mail” to email and other digital messages.
Figure (a) shows the shift in supply discussed in the following steps.
Step 1. Draw a demand and supply model to illustrate what the market for the U.S. Postal Service looked like before this scenario starts. The demand curve D0 and the supply curve S0 show the original relationships.
Step 2. Did the described change affect supply or demand? Labor compensation is a cost of production. A change in production costs caused a change in supply for the Postal Service.
Step 3. Was the effect on supply positive or negative? Higher labor compensation leads to a lower quantity supplied of postal services at every given price, causing the supply curve for postal services to shift to the left, from S0 to S1.
Step 4. Compare the new equilibrium price and quantity to the original equilibrium price. The new equilibrium (E1) occurs at a lower quantity and a higher price than the original equilibrium (E0).
Figure (b) shows the shift in demand in the following steps.
Step 1. Draw a demand and supply model to illustrate what the market for U.S. Postal Services looked like before this scenario starts. The demand curve D0 and the supply curve S0 show the original relationships. Note that this diagram is independent from the diagram in panel (a).
Step 2. Did the change described affect supply or demand? A change in tastes away from snail mail toward digital messages will cause a change in demand for the Postal Service.
Step 3. Was the effect on demand positive or negative? A change in tastes away from snailmail toward digital messages causes lower quantity demanded of postal services at every given price, causing the demand curve for postal services to shift to the left, from D0 to D1.
Step 4. Compare the new equilibrium price and quantity to the original equilibrium price. The new equilibrium (E2) occurs at a lower quantity and a lower price than the original equilibrium (E0).
The final step in a scenario where both supply and demand shift is to combine the two individual analyses to determine what happens to the equilibrium quantity and price. Graphically, we superimpose the previous two diagrams one on top of the other, as in Figure.
Following are the results:
Effect on Quantity: The effect of higher labor compensation on Postal Services because it raises the cost of production is to decrease the equilibrium quantity. The effect of a change in tastes away from snail mail is to decrease the equilibrium quantity. Since both shifts are to the left, the overall impact is a decrease in the equilibrium quantity of Postal Services (Q3). This is easy to see graphically, since Q3 is to the left of Q0.
Effect on Price: The overall effect on price is more complicated. The effect of higher labor compensation on Postal Services, because it raises the cost of production, is to increase the equilibrium price. The effect of a change in tastes away from snail mail is to decrease the equilibrium price. Since the two effects are in opposite directions, unless we know the magnitudes of the two effects, the overall effect is unclear. This is not unusual. When both curves shift, typically we can determine the overall effect on price or on quantity, but not on both. In this case, we determined the overall effect on the equilibrium quantity, but not on the equilibrium price. In other cases, it might be the opposite.
The next Clear It Up feature focuses on the difference between shifts of supply or demand and movements along a curve.
What is the difference between shifts of demand or supply versus movements along a demand or supply curve?
One common mistake in applying the demand and supply framework is to confuse the shift of a demand or a supply curve with movement along a demand or supply curve. As an example, consider a problem that asks whether a drought will increase or decrease the equilibrium quantity and equilibrium price of wheat. Lee, a student in an introductory economics class, might reason:
“Well, it is clear that a drought reduces supply, so I will shift back the supply curve, as in the shift from the original supply curve S0 to S1 on the diagram (Shift 1). The equilibrium moves from E0 to E1, the equilibrium quantity is lower and the equilibrium price is higher. Then, a higher price makes farmers more likely to supply the good, so the supply curve shifts right, as shows the shift from S1 to S2, shows on the diagram (Shift 2), so that the equilibrium now moves from E1 to E2. The higher price, however, also reduces demand and so causes demand to shift back, like the shift from the original demand curve, D0 to D1 on the diagram (labeled Shift 3), and the equilibrium moves from E2 to E3.”
At about this point, Lee suspects that this answer is headed down the wrong path. Think about what might be wrong with Lee’s logic, and then read the answer that follows.
Answer: Lee’s first step is correct: that is, a drought shifts back the supply curve of wheat and leads to a prediction of a lower equilibrium quantity and a higher equilibrium price. This corresponds to a movement along the original demand curve (D0), from E0 to E1. The rest of Lee’s argument is wrong, because it mixes up shifts in supply with quantity supplied, and shifts in demand with quantity demanded. A higher or lower price never shifts the supply curve, as suggested by the shift in supply from S1 to S2. Instead, a price change leads to a movement along a given supply curve. Similarly, a higher or lower price never shifts a demand curve, as suggested in the shift from D0 to D1. Instead, a price change leads to a movement along a given demand curve. Remember, a change in the price of a good never causes the demand or supply curve for that good to shift.
Think carefully about the timeline of events: What happens first, what happens next? What is cause, what is effect? If you keep the order right, you are more likely to get the analysis correct.
In the four-step analysis of how economic events affect equilibrium price and quantity, the movement from the old to the new equilibrium seems immediate. As a practical matter, however, prices and quantities often do not zoom straight to equilibrium. More realistically, when an economic event causes demand or supply to shift, prices and quantities set off in the general direction of equilibrium. Even as they are moving toward one new equilibrium, a subsequent change in demand or supply often pushes prices toward another equilibrium.
Key Concepts and Summary
When using the supply and demand framework to think about how an event will affect the equilibrium price and quantity, proceed through four steps: (1) sketch a supply and demand diagram to think about what the market looked like before the event; (2) decide whether the event will affect supply or demand; (3) decide whether the effect on supply or demand is negative or positive, and draw the appropriate shifted supply or demand curve; (4) compare the new equilibrium price and quantity to the original ones.
Self-Check Questions
Let’s think about the market for air travel. From August 2014 to January 2015, the price of jet fuel increased roughly 47%. Using the four-step analysis, how do you think this fuel price increase affected the equilibrium price and quantity of air travel?
Hint:
Step 1. Draw the graph with the initial supply and demand curves. Label the initial equilibrium price and quantity.
Step 2. Did the economic event affect supply or demand? Jet fuel is a cost of producing air travel, so an increase in jet fuel price affects supply.
Step 3. An increase in the price of jet fuel caused a decrease in the cost of air travel. We show this as a downward or rightward shift in supply.
Step 4. A rightward shift in supply causes a movement down the demand curve, lowering the equilibrium price of air travel and increasing the equilibrium quantity.
A tariff is a tax on imported goods. Suppose the U.S. government cuts the tariff on imported flat screen televisions. Using the four-step analysis, how do you think the tariff reduction will affect the equilibrium price and quantity of flat screen TVs?
Hint:
Step 1. Draw the graph with the initial supply and demand curves. Label the initial equilibrium price and quantity.
Step 2. Did the economic event affect supply or demand? A tariff is treated like a cost of production, so this affects supply.
Step 3. A tariff reduction is equivalent to a decrease in the cost of production, which we can show as a rightward (or downward) shift in supply.
Step 4. A rightward shift in supply causes a movement down the demand curve, lowering the equilibrium price and raising the equilibrium quantity.
Review Questions
How does one analyze a market where both demand and supply shift?
What causes a movement along the demand curve? What causes a movement along the supply curve?
Critical Thinking Questions
Use the four-step process to analyze the impact of the advent of the iPod (or other portable digital music players) on the equilibrium price and quantity of the Sony Walkman (or other portable audio cassette players).
Use the four-step process to analyze the impact of a reduction in tariffs on imports of iPods on the equilibrium price and quantity of Sony Walkman-type products.
Suppose both of these events took place at the same time. Combine your analyses of the impacts of the iPod and the tariff reduction to determine the likely impact on the equilibrium price and quantity of Sony Walkman-type products. Show your answer graphically.
Problems
Table illustrates the market's demand and supply for cheddar cheese. Graph the data and find the equilibrium. Next, create a table showing the change in quantity demanded or quantity supplied, and a graph of the new equilibrium, in each of the following situations:
- The price of milk, a key input for cheese production, rises, so that the supply decreases by 80 pounds at every price.
- A new study says that eating cheese is good for your health, so that demand increases by 20% at every price.
| Price per Pound | Qd | Qs |
|---|---|---|
| $3.00 | 750 | 540 |
| $3.20 | 700 | 600 |
| $3.40 | 650 | 650 |
| $3.60 | 620 | 700 |
| $3.80 | 600 | 720 |
| $4.00 | 590 | 730 |
Table shows the supply and demand for movie tickets in a city. Graph demand and supply and identify the equilibrium. Then calculate in a table and graph the effect of the following two changes.
- Three new nightclubs open. They offer decent bands and have no cover charge, but make their money by selling food and drink. As a result, demand for movie tickets falls by six units at every price.
- The city eliminates a tax that it placed on all local entertainment businesses. The result is that the quantity supplied of movies at any given price increases by 10%.
| Price per Pound | Qd | Qs |
|---|---|---|
| $5.00 | 26 | 16 |
| $6.00 | 24 | 18 |
| $7.00 | 22 | 20 |
| $8.00 | 21 | 21 |
| $9.00 | 20 | 22 |
References
Pew Research Center. “Pew Research: Center for the People & the Press.” http://www.people-press.org/.
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Price Ceilings and Price Floors
Overview
By the end of this section, you will be able to:
- Explain price controls, price ceilings, and price floors
- Analyze demand and supply as a social adjustment mechanism
To this point in the chapter, we have been assuming that markets are free, that is, they operate with no government intervention. In this section, we will explore the outcomes, both anticipated and otherwise, when government does intervene in a market either to prevent the price of some good or service from rising “too high” or to prevent the price of some good or service from falling “too low”.
Economists believe there are a small number of fundamental principles that explain how economic agents respond in different situations. Two of these principles, which we have already introduced, are the laws of demand and supply.
Governments can pass laws affecting market outcomes, but no law can negate these economic principles. Rather, the principles will become apparent in sometimes unexpected ways, which may undermine the intent of the government policy. This is one of the major conclusions of this section.
Controversy sometimes surrounds the prices and quantities established by demand and supply, especially for products that are considered necessities. In some cases, discontent over prices turns into public pressure on politicians, who may then pass legislation to prevent a certain price from climbing “too high” or falling “too low.”
The demand and supply model shows how people and firms will react to the incentives that these laws provide to control prices, in ways that will often lead to undesirable consequences. Alternative policy tools can often achieve the desired goals of price control laws, while avoiding at least some of their costs and tradeoffs.
Price Ceilings
Laws that government enact to regulate prices are called price controls. Price controls come in two flavors. A price ceiling keeps a price from rising above a certain level (the “ceiling”), while a price floor keeps a price from falling below a given level (the “floor”). This section uses the demand and supply framework to analyze price ceilings. The next section discusses price floors.
A price ceiling is a legal maximum price that one pays for some good or service. A government imposes price ceilings in order to keep the price of some necessary good or service affordable. For example, in 2005 during Hurricane Katrina, the price of bottled water increased above $5 per gallon. As a result, many people called for price controls on bottled water to prevent the price from rising so high. In this particular case, the government did not impose a price ceiling, but there are other examples of where price ceilings did occur.
In many markets for goods and services, demanders outnumber suppliers. Consumers, who are also potential voters, sometimes unite behind a political proposal to hold down a certain price. In some cities, such as Albany, renters have pressed political leaders to pass rent control laws, a price ceiling that usually works by stating that landlords can raise rents by only a certain maximum percentage each year. Some of the best examples of rent control occur in urban areas such as New York, Washington D.C., or San Francisco.
Rent control becomes a politically hot topic when rents begin to rise rapidly. Everyone needs an affordable place to live. Perhaps a change in tastes makes a certain suburb or town a more popular place to live. Perhaps locally-based businesses expand, bringing higher incomes and more people into the area. Such changes can cause a change in the demand for rental housing, as Figure illustrates. The original equilibrium (E0) lies at the intersection of supply curve S0 and demand curve D0, corresponding to an equilibrium price of $500 and an equilibrium quantity of 15,000 units of rental housing. The effect of greater income or a change in tastes is to shift the demand curve for rental housing to the right, as the data in Table shows and the shift from D0 to D1 on the graph. In this market, at the new equilibrium E1, the price of a rental unit would rise to $600 and the equilibrium quantity would increase to 17,000 units.
| Price | Original Quantity Supplied | Original Quantity Demanded | New Quantity Demanded |
|---|---|---|---|
| $400 | 12,000 | 18,000 | 23,000 |
| $500 | 15,000 | 15,000 | 19,000 |
| $600 | 17,000 | 13,000 | 17,000 |
| $700 | 19,000 | 11,000 | 15,000 |
| $800 | 20,000 | 10,000 | 14,000 |
Suppose that a city government passes a rent control law to keep the price at the original equilibrium of $500 for a typical apartment. In Figure, the horizontal line at the price of $500 shows the legally fixed maximum price set by the rent control law. However, the underlying forces that shifted the demand curve to the right are still there. At that price ($500), the quantity supplied remains at the same 15,000 rental units, but the quantity demanded is 19,000 rental units. In other words, the quantity demanded exceeds the quantity supplied, so there is a shortage of rental housing. One of the ironies of price ceilings is that while the price ceiling was intended to help renters, there are actually fewer apartments rented out under the price ceiling (15,000 rental units) than would be the case at the market rent of $600 (17,000 rental units).
Price ceilings do not simply benefit renters at the expense of landlords. Rather, some renters (or potential renters) lose their housing as landlords convert apartments to co-ops and condos. Even when the housing remains in the rental market, landlords tend to spend less on maintenance and on essentials like heating, cooling, hot water, and lighting. The first rule of economics is you do not get something for nothing—everything has an opportunity cost. Thus, if renters obtain “cheaper” housing than the market requires, they tend to also end up with lower quality housing.
Price ceilings are enacted in an attempt to keep prices low for those who need the product. However, when the market price is not allowed to rise to the equilibrium level, quantity demanded exceeds quantity supplied, and thus a shortage occurs. Those who manage to purchase the product at the lower price given by the price ceiling will benefit, but sellers of the product will suffer, along with those who are not able to purchase the product at all. Quality is also likely to deteriorate.
Price Floors
A price floor is the lowest price that one can legally pay for some good or service. Perhaps the best-known example of a price floor is the minimum wage, which is based on the view that someone working full time should be able to afford a basic standard of living. The federal minimum wage in 2016 was $7.25 per hour, although some states and localities have a higher minimum wage. The federal minimum wage yields an annual income for a single person of $15,080, which is slightly higher than the Federal poverty line of $11,880. As the cost of living rises over time, the Congress periodically raises the federal minimum wage.
Price floors are sometimes called “price supports,” because they support a price by preventing it from falling below a certain level. Around the world, many countries have passed laws to create agricultural price supports. Farm prices and thus farm incomes fluctuate, sometimes widely. Even if, on average, farm incomes are adequate, some years they can be quite low. The purpose of price supports is to prevent these swings.
The most common way price supports work is that the government enters the market and buys up the product, adding to demand to keep prices higher than they otherwise would be. According to the Common Agricultural Policy reform passed in 2013, the European Union (EU) will spend about 60 billion euros per year, or 67 billion dollars per year (with the November 2016 exchange rate), or roughly 38% of the EU budget, on price supports for Europe’s farmers from 2014 to 2020.
Figure illustrates the effects of a government program that assures a price above the equilibrium by focusing on the market for wheat in Europe. In the absence of government intervention, the price would adjust so that the quantity supplied would equal the quantity demanded at the equilibrium point E0, with price P0 and quantity Q0. However, policies to keep prices high for farmers keeps the price above what would have been the market equilibrium level—the price Pf shown by the dashed horizontal line in the diagram. The result is a quantity supplied in excess of the quantity demanded (Qd). When quantity supplied exceeds quantity demanded, a surplus exists.
Economists estimate that the high-income areas of the world, including the United States, Europe, and Japan, spend roughly $1 billion per day in supporting their farmers. If the government is willing to purchase the excess supply (or to provide payments for others to purchase it), then farmers will benefit from the price floor, but taxpayers and consumers of food will pay the costs. Agricultural economists and policy makers have offered numerous proposals for reducing farm subsidies. In many countries, however, political support for subsidies for farmers remains strong. This is either because the population views this as supporting the traditional rural way of life or because of industry's lobbying power of the agro-business.
Key Concepts and Summary
Price ceilings prevent a price from rising above a certain level. When a price ceiling is set below the equilibrium price, quantity demanded will exceed quantity supplied, and excess demand or shortages will result. Price floors prevent a price from falling below a certain level. When a price floor is set above the equilibrium price, quantity supplied will exceed quantity demanded, and excess supply or surpluses will result. Price floors and price ceilings often lead to unintended consequences.
Self-Check Questions
What is the effect of a price ceiling on the quantity demanded of the product? What is the effect of a price ceiling on the quantity supplied? Why exactly does a price ceiling cause a shortage?
Hint:
A price ceiling (which is below the equilibrium price) will cause the quantity demanded to rise and the quantity supplied to fall. This is why a price ceiling creates a shortage.
Does a price ceiling change the equilibrium price?
Hint:
A price ceiling is just a legal restriction. Equilibrium is an economic condition. People may or may not obey the price ceiling, so the actual price may be at or above the price ceiling, but the price ceiling does not change the equilibrium price.
What would be the impact of imposing a price floor below the equilibrium price?
Hint:
A price ceiling is a legal maximum price, but a price floor is a legal minimum price and, consequently, it would leave room for the price to rise to its equilibrium level. In other words, a price floor below equilibrium will not be binding and will have no effect.
Review Questions
Does a price ceiling attempt to make a price higher or lower?
How does a price ceiling set below the equilibrium level affect quantity demanded and quantity supplied?
Does a price floor attempt to make a price higher or lower?
How does a price floor set above the equilibrium level affect quantity demanded and quantity supplied?
Critical Thinking Questions
Most government policy decisions have winners and losers. What are the effects of raising the minimum wage? It is more complex than simply producers lose and workers gain. Who are the winners and who are the losers, and what exactly do they win and lose? To what extent does the policy change achieve its goals?
Agricultural price supports result in governments holding large inventories of agricultural products. Why do you think the government cannot simply give the products away to poor people?
Can you propose a policy that would induce the market to supply more rental housing units?
Problems
A low-income country decides to set a price ceiling on bread so it can make sure that bread is affordable to the poor.Table provides the conditions of demand and supply. What are the equilibrium price and equilibrium quantity before the price ceiling? What will the excess demand or the shortage (that is, quantity demanded minus quantity supplied) be if the price ceiling is set at $2.40? At $2.00? At $3.60?
| Price | Qd | Qs |
|---|---|---|
| $1.60 | 9,000 | 5,000 |
| $2.00 | 8,500 | 5,500 |
| $2.40 | 8,000 | 6,400 |
| $2.80 | 7,500 | 7,500 |
| $3.20 | 7,000 | 9,000 |
| $3.60 | 6,500 | 11,000 |
| $4.00 | 6,000 | 15,000 |
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Demand, Supply, and Efficiency
Overview
- Contrast consumer surplus, producer surplus, and social surplus
- Explain why price floors and price ceilings can be inefficient
- Analyze demand and supply as a social adjustment mechanism
The familiar demand and supply diagram holds within it the concept of economic efficiency. One typical way that economists define efficiency is when it is impossible to improve the situation of one party without imposing a cost on another. Conversely, if a situation is inefficient, it becomes possible to benefit at least one party without imposing costs on others.
Efficiency in the demand and supply model has the same basic meaning: The economy is getting as much benefit as possible from its scarce resources and all the possible gains from trade have been achieved. In other words, the optimal amount of each good and service is produced and consumed.
Consumer Surplus, Producer Surplus, Social Surplus
Consider a market for tablet computers, as Figure shows. The equilibrium price is $80 and the equilibrium quantity is 28 million. To see the benefits to consumers, look at the segment of the demand curve above the equilibrium point and to the left. This portion of the demand curve shows that at least some demanders would have been willing to pay more than $80 for a tablet.
For example, point J shows that if the price were $90, 20 million tablets would be sold. Those consumers who would have been willing to pay $90 for a tablet based on the utility they expect to receive from it, but who were able to pay the equilibrium price of $80, clearly received a benefit beyond what they had to pay. Remember, the demand curve traces consumers’ willingness to pay for different quantities. The amount that individuals would have been willing to pay, minus the amount that they actually paid, is called consumer surplus. Consumer surplus is the area labeled F—that is, the area above the market price and below the demand curve.
The supply curve shows the quantity that firms are willing to supply at each price. For example, point K in Figure illustrates that, at $45, firms would still have been willing to supply a quantity of 14 million. Those producers who would have been willing to supply the tablets at $45, but who were instead able to charge the equilibrium price of $80, clearly received an extra benefit beyond what they required to supply the product. The amount that a seller is paid for a good minus the seller’s actual cost is called producer surplus. In Figure, producer surplus is the area labeled G—that is, the area between the market price and the segment of the supply curve below the equilibrium.
The sum of consumer surplus and producer surplus is social surplus, also referred to as economic surplus or total surplus. In Figure we show social surplus as the area F + G. Social surplus is larger at equilibrium quantity and price than it would be at any other quantity. This demonstrates the economic efficiency of the market equilibrium. In addition, at the efficient level of output, it is impossible to produce greater consumer surplus without reducing producer surplus, and it is impossible to produce greater producer surplus without reducing consumer surplus.
Inefficiency of Price Floors and Price Ceilings
The imposition of a price floor or a price ceiling will prevent a market from adjusting to its equilibrium price and quantity, and thus will create an inefficient outcome. However, there is an additional twist here. Along with creating inefficiency, price floors and ceilings will also transfer some consumer surplus to producers, or some producer surplus to consumers.
Imagine that several firms develop a promising but expensive new drug for treating back pain. If this therapy is left to the market, the equilibrium price will be $600 per month and 20,000 people will use the drug, as shown in Figure (a). The original level of consumer surplus is T + U and producer surplus is V + W + X. However, the government decides to impose a price ceiling of $400 to make the drug more affordable. At this price ceiling, firms in the market now produce only 15,000.
As a result, two changes occur. First, an inefficient outcome occurs and the total surplus of society is reduced. The loss in social surplus that occurs when the economy produces at an inefficient quantity is called deadweight loss. In a very real sense, it is like money thrown away that benefits no one. In Figure (a), the deadweight loss is the area U + W. When deadweight loss exists, it is possible for both consumer and producer surplus to be higher, in this case because the price control is blocking some suppliers and demanders from transactions they would both be willing to make.
A second change from the price ceiling is that some of the producer surplus is transferred to consumers. After the price ceiling is imposed, the new consumer surplus is T + V, while the new producer surplus is X. In other words, the price ceiling transfers the area of surplus (V) from producers to consumers. Note that the gain to consumers is less than the loss to producers, which is just another way of seeing the deadweight loss.
Figure (b) shows a price floor example using a string of struggling movie theaters, all in the same city. The current equilibrium is $8 per movie ticket, with 1,800 people attending movies. The original consumer surplus is G + H + J, and producer surplus is I + K. The city government is worried that movie theaters will go out of business, reducing the entertainment options available to citizens, so it decides to impose a price floor of $12 per ticket. As a result, the quantity demanded of movie tickets falls to 1,400. The new consumer surplus is G, and the new producer surplus is H + I. In effect, the price floor causes the area H to be transferred from consumer to producer surplus, but also causes a deadweight loss of J + K.
This analysis shows that a price ceiling, like a law establishing rent controls, will transfer some producer surplus to consumers—which helps to explain why consumers often favor them. Conversely, a price floor like a guarantee that farmers will receive a certain price for their crops will transfer some consumer surplus to producers, which explains why producers often favor them. However, both price floors and price ceilings block some transactions that buyers and sellers would have been willing to make, and creates deadweight loss. Removing such barriers, so that prices and quantities can adjust to their equilibrium level, will increase the economy’s social surplus.
Demand and Supply as a Social Adjustment Mechanism
The demand and supply model emphasizes that prices are not set only by demand or only by supply, but by the interaction between the two. In 1890, the famous economist Alfred Marshall wrote that asking whether supply or demand determined a price was like arguing “whether it is the upper or the under blade of a pair of scissors that cuts a piece of paper.” The answer is that both blades of the demand and supply scissors are always involved.
The adjustments of equilibrium price and quantity in a market-oriented economy often occur without much government direction or oversight. If the coffee crop in Brazil suffers a terrible frost, then the supply curve of coffee shifts to the left and the price of coffee rises. Some people—call them the coffee addicts—continue to drink coffee and pay the higher price. Others switch to tea or soft drinks. No government commission is needed to figure out how to adjust coffee prices, which companies will be allowed to process the remaining supply, which supermarkets in which cities will get how much coffee to sell, or which consumers will ultimately be allowed to drink the brew. Such adjustments in response to price changes happen all the time in a market economy, often so smoothly and rapidly that we barely notice them.
Think for a moment of all the seasonal foods that are available and inexpensive at certain times of the year, like fresh corn in midsummer, but more expensive at other times of the year. People alter their diets and restaurants alter their menus in response to these fluctuations in prices without fuss or fanfare. For both the U.S. economy and the world economy as a whole, markets—that is, demand and supply—are the primary social mechanism for answering the basic questions about what is produced, how it is produced, and for whom it is produced.
Why Can We Not Get Enough of Organic?
Organic food is grown without synthetic pesticides, chemical fertilizers or genetically modified seeds. In recent decades, the demand for organic products has increased dramatically. The Organic Trade Association reported sales increased from $1 billion in 1990 to $35.1 billion in 2013, more than 90% of which were sales of food products.
Why, then, are organic foods more expensive than their conventional counterparts? The answer is a clear application of the theories of supply and demand. As people have learned more about the harmful effects of chemical fertilizers, growth hormones, pesticides and the like from large-scale factory farming, our tastes and preferences for safer, organic foods have increased. This change in tastes has been reinforced by increases in income, which allow people to purchase pricier products, and has made organic foods more mainstream. This has led to an increased demand for organic foods. Graphically, the demand curve has shifted right, and we have moved up the supply curve as producers have responded to the higher prices by supplying a greater quantity.
In addition to the movement along the supply curve, we have also had an increase in the number of farmers converting to organic farming over time. This is represented by a shift to the right of the supply curve. Since both demand and supply have shifted to the right, the resulting equilibrium quantity of organic foods is definitely higher, but the price will only fall when the increase in supply is larger than the increase in demand. We may need more time before we see lower prices in organic foods. Since the production costs of these foods may remain higher than conventional farming, because organic fertilizers and pest management techniques are more expensive, they may never fully catch up with the lower prices of non-organic foods.
As a final, specific example: The Environmental Working Group’s “Dirty Dozen” list of fruits and vegetables, which test high for pesticide residue even after washing, was released in April 2013. The inclusion of strawberries on the list has led to an increase in demand for organic strawberries, resulting in both a higher equilibrium price and quantity of sales.
Consumer surplus is the gap between the price that consumers are willing to pay, based on their preferences, and the market equilibrium price. Producer surplus is the gap between the price for which producers are willing to sell a product, based on their costs, and the market equilibrium price. Social surplus is the sum of consumer surplus and producer surplus. Total surplus is larger at the equilibrium quantity and price than it will be at any other quantity and price. Deadweight loss is loss in total surplus that occurs when the economy produces at an inefficient quantity.
Does a price ceiling increase or decrease the number of transactions in a market? Why? What about a price floor?
Hint:
Assuming that people obey the price ceiling, the market price will be below equilibrium, which means that Qd will be more than Qs. Buyers can only buy what is offered for sale, so the number of transactions will fall to Qs. This is easy to see graphically. By analogous reasoning, with a price floor the market price will be above the equilibrium price, so Qd will be less than Qs. Since the limit on transactions here is demand, the number of transactions will fall to Qd. Note that because both price floors and price ceilings reduce the number of transactions, social surplus is less.
If a price floor benefits producers, why does a price floor reduce social surplus?
Hint:
Because the losses to consumers are greater than the benefits to producers, so the net effect is negative. Since the lost consumer surplus is greater than the additional producer surplus, social surplus falls.
What is consumer surplus? How is it illustrated on a demand and supply diagram?
What is producer surplus? How is it illustrated on a demand and supply diagram?
What is total surplus? How is it illustrated on a demand and supply diagram?
What is the relationship between total surplus and economic efficiency?
What is deadweight loss?
What term would an economist use to describe what happens when a shopper gets a “good deal” on a product?
Explain why voluntary transactions improve social welfare.
Why would a free market never operate at a quantity greater than the equilibrium quantity? Hint: What would be required for a transaction to occur at that quantity?
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Introduction to Labor and Financial Markets
Baby Boomers Come of Age
The Census Bureau reports that as of 2013, 20% of the U.S. population was over 60 years old, which means that almost 63 million people are reaching an age when they will need increased medical care.
The baby boomer population, the group born between 1946 and 1964, is comprised of approximately 74 million people who have just reached retirement age. As this population grows older, they will be faced with common healthcare issues such as heart conditions, arthritis, and Alzheimer’s that may require hospitalization, long-term, or at-home nursing care. Aging baby boomers and advances in life-saving and life-extending technologies will increase the demand for healthcare and nursing. Additionally, the Affordable Care Act, which expands access to healthcare for millions of Americans, has further increase the demand, although with the election of Donald J. Trump, this increase may not be sustained.
According to the Bureau of Labor Statistics, registered nursing jobs are expected to increase by 16% between 2014 and 2024. The median annual wage of $67,490 (in 2015) is also expected to increase. The BLS forecasts that 439,000 new nurses will be in demand by 2022.
These data tell us, as economists, that the market for healthcare professionals, and nurses in particular, will face several challenges. Our study of supply and demand will help us to analyze what might happen in the labor market for nursing and other healthcare professionals, as we will discuss in the second half of this case at the end of the chapter.
Introduction to Labor and Financial Markets
In this chapter, you will learn about:
- Demand and Supply at Work in Labor Markets
- Demand and Supply in Financial Markets
- The Market System as an Efficient Mechanism for Information
The theories of supply and demand do not apply just to markets for goods. They apply to any market, even markets for things we may not think of as goods and services like labor and financial services. Labor markets are markets for employees or jobs. Financial services markets are markets for saving or borrowing.
When we think about demand and supply curves in goods and services markets, it is easy to picture the demanders and suppliers: businesses produce the products and households buy them. Who are the demanders and suppliers in labor and financial service markets? In labor markets job seekers (individuals) are the suppliers of labor, while firms and other employers who hire labor are the demanders for labor. In financial markets, any individual or firm who saves contributes to the supply of money, and any who borrows (person, firm, or government) contributes to the demand for money.
As a college student, you most likely participate in both labor and financial markets. Employment is a fact of life for most college students: According to the National Center for Educational Statistics, in 2013 40% of full-time college students and 76% of part-time college students were employed. Most college students are also heavily involved in financial markets, primarily as borrowers. Among full-time students, about half take out a loan to help finance their education each year, and those loans average about $6,000 per year. Many students also borrow for other expenses, like purchasing a car. As this chapter will illustrate, we can analyze labor markets and financial markets with the same tools we use to analyze demand and supply in the goods markets.
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Demand and Supply at Work in Labor Markets
Overview
By the end of this section, you will be able to:
- Predict shifts in the demand and supply curves of the labor market
- Explain the impact of new technology on the demand and supply curves of the labor market
- Explain price floors in the labor market such as minimum wage or a living wage
Markets for labor have demand and supply curves, just like markets for goods. The law of demand applies in labor markets this way: A higher salary or wage—that is, a higher price in the labor market—leads to a decrease in the quantity of labor demanded by employers, while a lower salary or wage leads to an increase in the quantity of labor demanded. The law of supply functions in labor markets, too: A higher price for labor leads to a higher quantity of labor supplied; a lower price leads to a lower quantity supplied.
Equilibrium in the Labor Market
In 2015, about 35,000 registered nurses worked in the Minneapolis-St. Paul-Bloomington, Minnesota-Wisconsin metropolitan area, according to the BLS. They worked for a variety of employers: hospitals, doctors’ offices, schools, health clinics, and nursing homes. Figure illustrates how demand and supply determine equilibrium in this labor market. The demand and supply schedules in Table list the quantity supplied and quantity demanded of nurses at different salaries.
| Annual Salary | Quantity Demanded | Quantity Supplied |
|---|---|---|
| $55,000 | 45,000 | 20,000 |
| $60,000 | 40,000 | 27,000 |
| $65,000 | 37,000 | 31,000 |
| $70,000 | 34,000 | 34,000 |
| $75,000 | 33,000 | 38,000 |
| $80,000 | 32,000 | 41,000 |
The horizontal axis shows the quantity of nurses hired. In this example we measure labor by number of workers, but another common way to measure the quantity of labor is by the number of hours worked. The vertical axis shows the price for nurses’ labor—that is, how much they are paid. In the real world, this “price” would be total labor compensation: salary plus benefits. It is not obvious, but benefits are a significant part (as high as 30 percent) of labor compensation. In this example we measure the price of labor by salary on an annual basis, although in other cases we could measure the price of labor by monthly or weekly pay, or even the wage paid per hour. As the salary for nurses rises, the quantity demanded will fall. Some hospitals and nursing homes may reduce the number of nurses they hire, or they may lay off some of their existing nurses, rather than pay them higher salaries. Employers who face higher nurses’ salaries may also try to replace some nursing functions by investing in physical equipment, like computer monitoring and diagnostic systems to monitor patients, or by using lower-paid health care aides to reduce the number of nurses they need.
As the salary for nurses rises, the quantity supplied will rise. If nurses’ salaries in Minneapolis-St. Paul-Bloomington are higher than in other cities, more nurses will move to Minneapolis-St. Paul-Bloomington to find jobs, more people will be willing to train as nurses, and those currently trained as nurses will be more likely to pursue nursing as a full-time job. In other words, there will be more nurses looking for jobs in the area.
At equilibrium, the quantity supplied and the quantity demanded are equal. Thus, every employer who wants to hire a nurse at this equilibrium wage can find a willing worker, and every nurse who wants to work at this equilibrium salary can find a job. In Figure, the supply curve (S) and demand curve (D) intersect at the equilibrium point (E). The equilibrium quantity of nurses in the Minneapolis-St. Paul-Bloomington area is 34,000, and the equilibrium salary is $70,000 per year. This example simplifies the nursing market by focusing on the “average” nurse. In reality, of course, the market for nurses actually comprises many smaller markets, like markets for nurses with varying degrees of experience and credentials. Many markets contain closely related products that differ in quality. For instance, even a simple product like gasoline comes in regular, premium, and super-premium, each with a different price. Even in such cases, discussing the average price of gasoline, like the average salary for nurses, can still be useful because it reflects what is happening in most of the submarkets.
When the price of labor is not at the equilibrium, economic incentives tend to move salaries toward the equilibrium. For example, if salaries for nurses in Minneapolis-St. Paul-Bloomington were above the equilibrium at $75,000 per year, then 38,000 people want to work as nurses, but employers want to hire only 33,000 nurses. At that above-equilibrium salary, excess supply or a surplus results. In a situation of excess supply in the labor market, with many applicants for every job opening, employers will have an incentive to offer lower wages than they otherwise would have. Nurses’ salary will move down toward equilibrium.
In contrast, if the salary is below the equilibrium at, say, $60,000 per year, then a situation of excess demand or a shortage arises. In this case, employers encouraged by the relatively lower wage want to hire 40,000 nurses, but only 27,000 individuals want to work as nurses at that salary in Minneapolis-St. Paul-Bloomington. In response to the shortage, some employers will offer higher pay to attract the nurses. Other employers will have to match the higher pay to keep their own employees. The higher salaries will encourage more nurses to train or work in Minneapolis-St. Paul-Bloomington. Again, price and quantity in the labor market will move toward equilibrium.
Shifts in Labor Demand
The demand curve for labor shows the quantity of labor employers wish to hire at any given salary or wage rate, under the ceteris paribus assumption. A change in the wage or salary will result in a change in the quantity demanded of labor. If the wage rate increases, employers will want to hire fewer employees. The quantity of labor demanded will decrease, and there will be a movement upward along the demand curve. If the wages and salaries decrease, employers are more likely to hire a greater number of workers. The quantity of labor demanded will increase, resulting in a downward movement along the demand curve.
Shifts in the demand curve for labor occur for many reasons. One key reason is that the demand for labor is based on the demand for the good or service that is produced. For example, the more new automobiles consumers demand, the greater the number of workers automakers will need to hire. Therefore the demand for labor is called a “derived demand.” Here are some examples of derived demand for labor:
- The demand for chefs is dependent on the demand for restaurant meals.
- The demand for pharmacists is dependent on the demand for prescription drugs.
- The demand for attorneys is dependent on the demand for legal services.
As the demand for the goods and services increases, the demand for labor will increase, or shift to the right, to meet employers’ production requirements. As the demand for the goods and services decreases, the demand for labor will decrease, or shift to the left. Table shows that in addition to the derived demand for labor, demand can also increase or decrease (shift) in response to several factors.
| Factors | Results |
|---|---|
| Demand for Output | When the demand for the good produced (output) increases, both the output price and profitability increase. As a result, producers demand more labor to ramp up production. |
| Education and Training | A well-trained and educated workforce causes an increase in the demand for that labor by employers. Increased levels of productivity within the workforce will cause the demand for labor to shift to the right. If the workforce is not well-trained or educated, employers will not hire from within that labor pool, since they will need to spend a significant amount of time and money training that workforce. Demand for such will shift to the left. |
| Technology | Technology changes can act as either substitutes for or complements to labor. When technology acts as a substitute, it replaces the need for the number of workers an employer needs to hire. For example, word processing decreased the number of typists needed in the workplace. This shifted the demand curve for typists left. An increase in the availability of certain technologies may increase the demand for labor. Technology that acts as a complement to labor will increase the demand for certain types of labor, resulting in a rightward shift of the demand curve. For example, the increased use of word processing and other software has increased the demand for information technology professionals who can resolve software and hardware issues related to a firm’s network. More and better technology will increase demand for skilled workers who know how to use technology to enhance workplace productivity. Those workers who do not adapt to changes in technology will experience a decrease in demand. |
| Number of Companies | An increase in the number of companies producing a given product will increase the demand for labor resulting in a shift to the right. A decrease in the number of companies producing a given product will decrease the demand for labor resulting in a shift to the left. |
| Government Regulations | Complying with government regulations can increase or decrease the demand for labor at any given wage. In the healthcare industry, government rules may require that nurses be hired to carry out certain medical procedures. This will increase the demand for nurses. Less-trained healthcare workers would be prohibited from carrying out these procedures, and the demand for these workers will shift to the left. |
| Price and Availability of Other Inputs | Labor is not the only input into the production process. For example, a salesperson at a call center needs a telephone and a computer terminal to enter data and record sales. If prices of other inputs fall, production will become more profitable and suppliers will demand more labor to increase production. This will cause a rightward shift in the demand curve for labor. The opposite is also true. Higher prices for other inputs lower demand for labor. |
Click here to read more about “Trends and Challenges for Work in the 21st Century.”
Shifts in Labor Supply
The supply of labor is upward-sloping and adheres to the law of supply: The higher the price, the greater the quantity supplied and the lower the price, the less quantity supplied. The supply curve models the tradeoff between supplying labor into the market or using time in leisure activities at every given price level. The higher the wage, the more labor is willing to work and forego leisure activities. Table lists some of the factors that will cause the supply to increase or decrease.
| Factors | Results |
|---|---|
| Number of Workers | An increased number of workers will cause the supply curve to shift to the right. An increased number of workers can be due to several factors, such as immigration, increasing population, an aging population, and changing demographics. Policies that encourage immigration will increase the supply of labor, and vice versa. Population grows when birth rates exceed death rates. This eventually increases supply of labor when the former reach working age. An aging and therefore retiring population will decrease the supply of labor. Another example of changing demographics is more women working outside of the home, which increases the supply of labor. |
| Required Education | The more required education, the lower the supply. There is a lower supply of PhD mathematicians than of high school mathematics teachers; there is a lower supply of cardiologists than of primary care physicians; and there is a lower supply of physicians than of nurses. |
| Government Policies | Government policies can also affect the supply of labor for jobs. Alternatively, the government may support rules that set high qualifications for certain jobs: academic training, certificates or licenses, or experience. When these qualifications are made tougher, the number of qualified workers will decrease at any given wage. On the other hand, the government may also subsidize training or even reduce the required level of qualifications. For example, government might offer subsidies for nursing schools or nursing students. Such provisions would shift the supply curve of nurses to the right. In addition, government policies that change the relative desirability of working versus not working also affect the labor supply. These include unemployment benefits, maternity leave, child care benefits, and welfare policy. For example, child care benefits may increase the labor supply of working mothers. Long term unemployment benefits may discourage job searching for unemployed workers. All these policies must therefore be carefully designed to minimize any negative labor supply effects. |
A change in salary will lead to a movement along labor demand or labor supply curves, but it will not shift those curves. However, other events like those we have outlined here will cause either the demand or the supply of labor to shift, and thus will move the labor market to a new equilibrium salary and quantity.
Technology and Wage Inequality: The Four-Step Process
Economic events can change the equilibrium salary (or wage) and quantity of labor. Consider how the wave of new information technologies, like computer and telecommunications networks, has affected low-skill and high-skill workers in the U.S. economy. From the perspective of employers who demand labor, these new technologies are often a substitute for low-skill laborers like file clerks who used to keep file cabinets full of paper records of transactions. However, the same new technologies are a complement to high-skill workers like managers, who benefit from the technological advances by having the ability to monitor more information, communicate more easily, and juggle a wider array of responsibilities. How will the new technologies affect the wages of high-skill and low-skill workers? For this question, the four-step process of analyzing how shifts in supply or demand affect a market (introduced in Demand and Supply) works in this way:
Step 1. What did the markets for low-skill labor and high-skill labor look like before the arrival of the new technologies? In Figure (a) and Figure (b), S0 is the original supply curve for labor and D0 is the original demand curve for labor in each market. In each graph, the original point of equilibrium, E0, occurs at the price W0 and the quantity Q0.
Step 2. Does the new technology affect the supply of labor from households or the demand for labor from firms? The technology change described here affects demand for labor by firms that hire workers.
Step 3. Will the new technology increase or decrease demand? Based on the description earlier, as the substitute for low-skill labor becomes available, demand for low-skill labor will shift to the left, from D0 to D1. As the technology complement for high-skill labor becomes cheaper, demand for high-skill labor will shift to the right, from D0 to D1.
Step 4. The new equilibrium for low-skill labor, shown as point E1 with price W1 and quantity Q1, has a lower wage and quantity hired than the original equilibrium, E0. The new equilibrium for high-skill labor, shown as point E1 with price W1 and quantity Q1, has a higher wage and quantity hired than the original equilibrium (E0).
Thus, the demand and supply model predicts that the new computer and communications technologies will raise the pay of high-skill workers but reduce the pay of low-skill workers. From the 1970s to the mid-2000s, the wage gap widened between high-skill and low-skill labor. According to the National Center for Education Statistics, in 1980, for example, a college graduate earned about 30% more than a high school graduate with comparable job experience, but by 2014, a college graduate earned about 66% more than an otherwise comparable high school graduate. Many economists believe that the trend toward greater wage inequality across the U.S. economy is due to improvements in technology.
Visit this website to read about ten tech skills that have lost relevance in today’s workforce.
Price Floors in the Labor Market: Living Wages and Minimum Wages
In contrast to goods and services markets, price ceilings are rare in labor markets, because rules that prevent people from earning income are not politically popular. There is one exception: boards of trustees or stockholders, as an example, propose limits on the high incomes of top business executives.
The labor market, however, presents some prominent examples of price floors, which are an attempt to increase the wages of low-paid workers. The U.S. government sets a minimum wage, a price floor that makes it illegal for an employer to pay employees less than a certain hourly rate. In mid-2009, the U.S. minimum wage was raised to $7.25 per hour. Local political movements in a number of U.S. cities have pushed for a higher minimum wage, which they call a living wage. Promoters of living wage laws maintain that the minimum wage is too low to ensure a reasonable standard of living. They base this conclusion on the calculation that, if you work 40 hours a week at a minimum wage of $7.25 per hour for 50 weeks a year, your annual income is $14,500, which is less than the official U.S. government definition of what it means for a family to be in poverty. (A family with two adults earning minimum wage and two young children will find it more cost efficient for one parent to provide childcare while the other works for income. Thus the family income would be $14,500, which is significantly lower than the federal poverty line for a family of four, which was $24,250 in 2015.)
Supporters of the living wage argue that full-time workers should be assured a high enough wage so that they can afford the essentials of life: food, clothing, shelter, and healthcare. Since Baltimore passed the first living wage law in 1994, several dozen cities enacted similar laws in the late 1990s and the 2000s. The living wage ordinances do not apply to all employers, but they have specified that all employees of the city or employees of firms that the city hires be paid at least a certain wage that is usually a few dollars per hour above the U.S. minimum wage.
Figure illustrates the situation of a city considering a living wage law. For simplicity, we assume that there is no federal minimum wage. The wage appears on the vertical axis, because the wage is the price in the labor market. Before the passage of the living wage law, the equilibrium wage is $10 per hour and the city hires 1,200 workers at this wage. However, a group of concerned citizens persuades the city council to enact a living wage law requiring employers to pay no less than $12 per hour. In response to the higher wage, 1,600 workers look for jobs with the city. At this higher wage, the city, as an employer, is willing to hire only 700 workers. At the price floor, the quantity supplied exceeds the quantity demanded, and a surplus of labor exists in this market. For workers who continue to have a job at a higher salary, life has improved. For those who were willing to work at the old wage rate but lost their jobs with the wage increase, life has not improved. Table shows the differences in supply and demand at different wages.
| Wage | Quantity Labor Demanded | Quantity Labor Supplied |
|---|---|---|
| $8/hr | 1,900 | 500 |
| $9/hr | 1,500 | 900 |
| $10/hr | 1,200 | 1,200 |
| $11/hr | 900 | 1,400 |
| $12/hr | 700 | 1,600 |
| $13/hr | 500 | 1,800 |
| $14/hr | 400 | 1,900 |
The Minimum Wage as an Example of a Price Floor
The U.S. minimum wage is a price floor that is set either very close to the equilibrium wage or even slightly below it. About 1% of American workers are actually paid the minimum wage. In other words, the vast majority of the U.S. labor force has its wages determined in the labor market, not as a result of the government price floor. However, for workers with low skills and little experience, like those without a high school diploma or teenagers, the minimum wage is quite important. In many cities, the federal minimum wage is apparently below the market price for unskilled labor, because employers offer more than the minimum wage to checkout clerks and other low-skill workers without any government prodding.
Economists have attempted to estimate how much the minimum wage reduces the quantity demanded of low-skill labor. A typical result of such studies is that a 10% increase in the minimum wage would decrease the hiring of unskilled workers by 1 to 2%, which seems a relatively small reduction. In fact, some studies have even found no effect of a higher minimum wage on employment at certain times and places—although these studies are controversial.
Let’s suppose that the minimum wage lies just slightly below the equilibrium wage level. Wages could fluctuate according to market forces above this price floor, but they would not be allowed to move beneath the floor. In this situation, the price floor minimum wage is nonbinding —that is, the price floor is not determining the market outcome. Even if the minimum wage moves just a little higher, it will still have no effect on the quantity of employment in the economy, as long as it remains below the equilibrium wage. Even if the government increases minimum wage by enough so that it rises slightly above the equilibrium wage and becomes binding, there will be only a small excess supply gap between the quantity demanded and quantity supplied.
These insights help to explain why U.S. minimum wage laws have historically had only a small impact on employment. Since the minimum wage has typically been set close to the equilibrium wage for low-skill labor and sometimes even below it, it has not had a large effect in creating an excess supply of labor. However, if the minimum wage increased dramatically—say, if it doubled to match the living wages that some U.S. cities have considered—then its impact on reducing the quantity demanded of employment would be far greater. As of 2017, many U.S. states are set to increase their minimum wage to $15 per hour. We will see what happens. The following Clear It Up feature describes in greater detail some of the arguments for and against changes to minimum wage.
What’s the harm in raising the minimum wage?
Because of the law of demand, a higher required wage will reduce the amount of low-skill employment either in terms of employees or in terms of work hours. Although there is controversy over the numbers, let’s say for the sake of the argument that a 10% rise in the minimum wage will reduce the employment of low-skill workers by 2%. Does this outcome mean that raising the minimum wage by 10% is bad public policy? Not necessarily.
If 98% of those receiving the minimum wage have a pay increase of 10%, but 2% of those receiving the minimum wage lose their jobs, are the gains for society as a whole greater than the losses? The answer is not clear, because job losses, even for a small group, may cause more pain than modest income gains for others. For one thing, we need to consider which minimum wage workers are losing their jobs. If the 2% of minimum wage workers who lose their jobs are struggling to support families, that is one thing. If those who lose their job are high school students picking up spending money over summer vacation, that is something else.
Another complexity is that many minimum wage workers do not work full-time for an entire year. Imagine a minimum wage worker who holds different part-time jobs for a few months at a time, with bouts of unemployment in between. The worker in this situation receives the 10% raise in the minimum wage when working, but also ends up working 2% fewer hours during the year because the higher minimum wage reduces how much employers want people to work. Overall, this worker’s income would rise because the 10% pay raise would more than offset the 2% fewer hours worked.
Of course, these arguments do not prove that raising the minimum wage is necessarily a good idea either. There may well be other, better public policy options for helping low-wage workers. (The Poverty and Economic Inequality chapter discusses some possibilities.) The lesson from this maze of minimum wage arguments is that complex social problems rarely have simple answers. Even those who agree on how a proposed economic policy affects quantity demanded and quantity supplied may still disagree on whether the policy is a good idea.
Concepts and Summary
In the labor market, households are on the supply side of the market and firms are on the demand side. In the market for financial capital, households and firms can be on either side of the market: they are suppliers of financial capital when they save or make financial investments, and demanders of financial capital when they borrow or receive financial investments.
In the demand and supply analysis of labor markets, we can measure the price by the annual salary or hourly wage received. We can measure the quantity of labor various ways, like number of workers or the number of hours worked.
Factors that can shift the demand curve for labor include: a change in the quantity demanded of the product that the labor produces; a change in the production process that uses more or less labor; and a change in government policy that affects the quantity of labor that firms wish to hire at a given wage. Demand can also increase or decrease (shift) in response to: workers’ level of education and training, technology, the number of companies, and availability and price of other inputs.
The main factors that can shift the supply curve for labor are: how desirable a job appears to workers relative to the alternatives, government policy that either restricts or encourages the quantity of workers trained for the job, the number of workers in the economy, and required education.
Self-Check Questions
In the labor market, what causes a movement along the demand curve? What causes a shift in the demand curve?
Hint:
Changes in the wage rate (the price of labor) cause a movement along the demand curve. A change in anything else that affects demand for labor (e.g., changes in output, changes in the production process that use more or less labor, government regulation) causes a shift in the demand curve.
In the labor market, what causes a movement along the supply curve? What causes a shift in the supply curve?
Hint:
Changes in the wage rate (the price of labor) cause a movement along the supply curve. A change in anything else that affects supply of labor (e.g., changes in how desirable the job is perceived to be, government policy to promote training in the field) causes a shift in the supply curve.
Why is a living wage considered a price floor? Does imposing a living wage have the same outcome as a minimum wage?
Hint:
Since a living wage is a suggested minimum wage, it acts like a price floor (assuming, of course, that it is followed). If the living wage is binding, it will cause an excess supply of labor at that wage rate.
Review Questions
What is the “price” commonly called in the labor market?
Are households demanders or suppliers in the goods market? Are firms demanders or suppliers in the goods market? What about the labor market and the financial market?
Name some factors that can cause a shift in the demand curve in labor markets.
Name some factors that can cause a shift in the supply curve in labor markets.
Critical Thinking Questions
Other than the demand for labor, what would be another example of a “derived demand?”
Suppose that a 5% increase in the minimum wage causes a 5% reduction in employment. How would this affect employers and how would it affect workers? In your opinion, would this be a good policy?
Under what circumstances would a minimum wage be a nonbinding price floor? Under what circumstances would a living wage be a binding price floor?
Problems
Identify each of the following as involving either demand or supply. Draw a circular flow diagram and label the flows A through F. (Some choices can be on both sides of the goods market.)
- Households in the labor market
- Firms in the goods market
- Firms in the financial market
- Households in the goods market
- Firms in the labor market
- Households in the financial market
Predict how each of the following events will raise or lower the equilibrium wage and quantity of oil workers in Texas. In each case, sketch a demand and supply diagram to illustrate your answer.
- The price of oil rises.
- New oil-drilling equipment is invented that is cheap and requires few workers to run.
- Several major companies that do not drill oil open factories in Texas, offering many well-paid jobs outside the oil industry.
- Government imposes costly new regulations to make oil-drilling a safer job.
References
American Community Survey. 2012. "School Enrollment and Work Status: 2011." Accessed April 13, 2015. http://www.census.gov/prod/2013pubs/acsbr11-14.pdf.
National Center for Educational Statistics. “Digest of Education Statistics.” (2008 and 2010). Accessed December 11, 2013. nces.ed.gov.
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"title": "Principles of Macroeconomics 2e, Labor and Financial Markets",
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https://oercommons.org/courseware/lesson/28789/overview
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Demand and Supply in Financial Markets
Overview
By the end of this section, you will be able to:
- Identify the demanders and suppliers in a financial market
- Explain how interest rates can affect supply and demand
- Analyze the economic effects of U.S. debt in terms of domestic financial markets
- Explain the role of price ceilings and usury laws in the U.S.
United States' households, institutions, and domestic businesses saved almost $1.3 trillion in 2015. Where did that savings go and how was it used? Some of the savings ended up in banks, which in turn loaned the money to individuals or businesses that wanted to borrow money. Some was invested in private companies or loaned to government agencies that wanted to borrow money to raise funds for purposes like building roads or mass transit. Some firms reinvested their savings in their own businesses.
In this section, we will determine how the demand and supply model links those who wish to supply financial capital (i.e., savings) with those who demand financial capital (i.e., borrowing). Those who save money (or make financial investments, which is the same thing), whether individuals or businesses, are on the supply side of the financial market. Those who borrow money are on the demand side of the financial market. For a more detailed treatment of the different kinds of financial investments like bank accounts, stocks and bonds, see the Financial Markets chapter.
Who Demands and Who Supplies in Financial Markets?
In any market, the price is what suppliers receive and what demanders pay. In financial markets, those who supply financial capital through saving expect to receive a rate of return, while those who demand financial capital by receiving funds expect to pay a rate of return. This rate of return can come in a variety of forms, depending on the type of investment.
The simplest example of a rate of return is the interest rate. For example, when you supply money into a savings account at a bank, you receive interest on your deposit. The interest the bank pays you as a percent of your deposits is the interest rate. Similarly, if you demand a loan to buy a car or a computer, you will need to pay interest on the money you borrow.
Let’s consider the market for borrowing money with credit cards. In 2015, almost 200 million Americans were cardholders. Credit cards allow you to borrow money from the card's issuer, and pay back the borrowed amount plus interest, although most allow you a period of time in which you can repay the loan without paying interest. A typical credit card interest rate ranges from 12% to 18% per year. In May 2016, Americans had about $943 billion outstanding in credit card debts. About half of U.S. families with credit cards report that they almost always pay the full balance on time, but one-quarter of U.S. families with credit cards say that they “hardly ever” pay off the card in full. In fact, in 2014, 56% of consumers carried an unpaid balance in the last 12 months. Let’s say that, on average, the annual interest rate for credit card borrowing is 15% per year. Thus, Americans pay tens of billions of dollars every year in interest on their credit cards—plus basic fees for the credit card or fees for late payments.
Figure illustrates demand and supply in the financial market for credit cards. The horizontal axis of the financial market shows the quantity of money loaned or borrowed in this market. The vertical or price axis shows the rate of return, which in the case of credit card borrowing we can measure with an interest rate. Table shows the quantity of financial capital that consumers demand at various interest rates and the quantity that credit card firms (often banks) are willing to supply.
| Interest Rate (%) | Quantity of Financial Capital Demanded (Borrowing) ($ billions) | Quantity of Financial Capital Supplied (Lending) ($ billions) |
|---|---|---|
| 11 | $800 | $420 |
| 13 | $700 | $510 |
| 15 | $600 | $600 |
| 17 | $550 | $660 |
| 19 | $500 | $720 |
| 21 | $480 | $750 |
The laws of demand and supply continue to apply in the financial markets. According to the law of demand, a higher rate of return (that is, a higher price) will decrease the quantity demanded. As the interest rate rises, consumers will reduce the quantity that they borrow. According to the law of supply, a higher price increases the quantity supplied. Consequently, as the interest rate paid on credit card borrowing rises, more firms will be eager to issue credit cards and to encourage customers to use them. Conversely, if the interest rate on credit cards falls, the quantity of financial capital supplied in the credit card market will decrease and the quantity demanded will fall.
Equilibrium in Financial Markets
In the financial market for credit cards in Figure, the supply curve (S) and the demand curve (D) cross at the equilibrium point (E). The equilibrium occurs at an interest rate of 15%, where the quantity of funds demanded and the quantity supplied are equal at an equilibrium quantity of $600 billion.
If the interest rate (remember, this measures the “price” in the financial market) is above the equilibrium level, then an excess supply, or a surplus, of financial capital will arise in this market. For example, at an interest rate of 21%, the quantity of funds supplied increases to $750 billion, while the quantity demanded decreases to $480 billion. At this above-equilibrium interest rate, firms are eager to supply loans to credit card borrowers, but relatively few people or businesses wish to borrow. As a result, some credit card firms will lower the interest rates (or other fees) they charge to attract more business. This strategy will push the interest rate down toward the equilibrium level.
If the interest rate is below the equilibrium, then excess demand or a shortage of funds occurs in this market. At an interest rate of 13%, the quantity of funds credit card borrowers demand increases to $700 billion, but the quantity credit card firms are willing to supply is only $510 billion. In this situation, credit card firms will perceive that they are overloaded with eager borrowers and conclude that they have an opportunity to raise interest rates or fees. The interest rate will face economic pressures to creep up toward the equilibrium level.
The FRED database publishes some two dozen measures of interest rates, including interest rates on credit cards, automobile loans, personal loans, mortgage loans, and more. You can find these at the FRED website.
Shifts in Demand and Supply in Financial Markets
Those who supply financial capital face two broad decisions: how much to save, and how to divide up their savings among different forms of financial investments. We will discuss each of these in turn.
Participants in financial markets must decide when they prefer to consume goods: now or in the future. Economists call this intertemporal decision making because it involves decisions across time. Unlike a decision about what to buy from the grocery store, people make investment or savings decisions across a period of time, sometimes a long period.
Most workers save for retirement because their income in the present is greater than their needs, while the opposite will be true once they retire. Thus, they save today and supply financial markets. If their income increases, they save more. If their perceived situation in the future changes, they change the amount of their saving. For example, there is some evidence that Social Security, the program that workers pay into in order to qualify for government checks after retirement, has tended to reduce the quantity of financial capital that workers save. If this is true, Social Security has shifted the supply of financial capital at any interest rate to the left.
By contrast, many college students need money today when their income is low (or nonexistent) to pay their college expenses. As a result, they borrow today and demand from financial markets. Once they graduate and become employed, they will pay back the loans. Individuals borrow money to purchase homes or cars. A business seeks financial investment so that it has the funds to build a factory or invest in a research and development project that will not pay off for five years, ten years, or even more. Thus, when consumers and businesses have greater confidence that they will be able to repay in the future, the quantity demanded of financial capital at any given interest rate will shift to the right.
For example, in the technology boom of the late 1990s, many businesses became extremely confident that investments in new technology would have a high rate of return, and their demand for financial capital shifted to the right. Conversely, during the 2008 and 2009 Great Recession, their demand for financial capital at any given interest rate shifted to the left.
To this point, we have been looking at saving in total. Now let us consider what affects saving in different types of financial investments. In deciding between different forms of financial investments, suppliers of financial capital will have to consider the rates of return and the risks involved. Rate of return is a positive attribute of investments, but risk is a negative. If Investment A becomes more risky, or the return diminishes, then savers will shift their funds to Investment B—and the supply curve of financial capital for Investment A will shift back to the left while the supply curve of capital for Investment B shifts to the right.
The United States as a Global Borrower
In the global economy, trillions of dollars of financial investment cross national borders every year. In the early 2000s, financial investors from foreign countries were investing several hundred billion dollars per year more in the U.S. economy than U.S. financial investors were investing abroad. The following Work It Out deals with one of the macroeconomic concerns for the U.S. economy in recent years.
The Effect of Growing U.S. Debt
Imagine that foreign investors viewed the U.S. economy as a less desirable place to put their money because of fears about the growth of the U.S. public debt. Using the four-step process for analyzing how changes in supply and demand affect equilibrium outcomes, how would increased U.S. public debt affect the equilibrium price and quantity for capital in U.S. financial markets?
Step 1. Draw a diagram showing demand and supply for financial capital that represents the original scenario in which foreign investors are pouring money into the U.S. economy. Figure shows a demand curve, D, and a supply curve, S, where the supply of capital includes the funds arriving from foreign investors. The original equilibrium E0 occurs at interest rate R0 and quantity of financial investment Q0.
Step 2. Will the diminished confidence in the U.S. economy as a place to invest affect demand or supply of financial capital? Yes, it will affect supply. Many foreign investors look to the U.S. financial markets to store their money in safe financial vehicles with low risk and stable returns. Diminished confidence means U.S. financial assets will be seen as more risky.
Step 3. Will supply increase or decrease? When the enthusiasm of foreign investors’ for investing their money in the U.S. economy diminishes, the supply of financial capital shifts to the left. Figure shows the supply curve shift from S0 to S1.
Step 4. Thus, foreign investors’ diminished enthusiasm leads to a new equilibrium, E1, which occurs at the higher interest rate, R1, and the lower quantity of financial investment, Q1. In short, U.S. borrowers will have to pay more interest on their borrowing.
The economy has experienced an enormous inflow of foreign capital. According to the U.S. Bureau of Economic Analysis, by the third quarter of 2015, U.S. investors had accumulated $23.3 trillion of foreign assets, but foreign investors owned a total of $30.6 trillion of U.S. assets. If foreign investors were to pull their money out of the U.S. economy and invest elsewhere in the world, the result could be a significantly lower quantity of financial investment in the United States, available only at a higher interest rate. This reduced inflow of foreign financial investment could impose hardship on U.S. consumers and firms interested in borrowing.
In a modern, developed economy, financial capital often moves invisibly through electronic transfers between one bank account and another. Yet we can analyze these flows of funds with the same tools of demand and supply as markets for goods or labor.
Price Ceilings in Financial Markets: Usury Laws
As we noted earlier, about 200 million Americans own credit cards, and their interest payments and fees total tens of billions of dollars each year. It is little wonder that political pressures sometimes arise for setting limits on the interest rates or fees that credit card companies charge. The firms that issue credit cards, including banks, oil companies, phone companies, and retail stores, respond that the higher interest rates are necessary to cover the losses created by those who borrow on their credit cards and who do not repay on time or at all. These companies also point out that cardholders can avoid paying interest if they pay their bills on time.
Consider the credit card market as Figure illustrators. In this financial market, the vertical axis shows the interest rate (which is the price in the financial market). Demanders in the credit card market are households and businesses. Suppliers are the companies that issue credit cards. This figure does not use specific numbers, which would be hypothetical in any case, but instead focuses on the underlying economic relationships. Imagine a law imposes a price ceiling that holds the interest rate charged on credit cards at the rate Rc, which lies below the interest rate R0 that would otherwise have prevailed in the market. The horizontal dashed line at interest rate Rc in Figure shows the price ceiling. The demand and supply model predicts that at the lower price ceiling interest rate, the quantity demanded of credit card debt will increase from its original level of Q0 to Qd; however, the quantity supplied of credit card debt will decrease from the original Q0 to Qs. At the price ceiling (Rc), quantity demanded will exceed quantity supplied. Consequently, a number of people who want to have credit cards and are willing to pay the prevailing interest rate will find that companies are unwilling to issue cards to them. The result will be a credit shortage.
Many states do have usury laws, which impose an upper limit on the interest rate that lenders can charge. However, in many cases these upper limits are well above the market interest rate. For example, if the interest rate is not allowed to rise above 30% per year, it can still fluctuate below that level according to market forces. A price ceiling that is set at a relatively high level is nonbinding, and it will have no practical effect unless the equilibrium price soars high enough to exceed the price ceiling.
Key Concepts and Summary
In the demand and supply analysis of financial markets, the “price” is the rate of return or the interest rate received. We measure the quantity by the money that flows from those who supply financial capital to those who demand it.
Two factors can shift the supply of financial capital to a certain investment: if people want to alter their existing levels of consumption, and if the riskiness or return on one investment changes relative to other investments. Factors that can shift demand for capital include business confidence and consumer confidence in the future—since financial investments received in the present are typically repaid in the future.
Self-Check Questions
In the financial market, what causes a movement along the demand curve? What causes a shift in the demand curve?
Hint:
Changes in the interest rate (i.e., the price of financial capital) cause a movement along the demand curve. A change in anything else (non-price variable) that affects demand for financial capital (e.g., changes in confidence about the future, changes in needs for borrowing) would shift the demand curve.
In the financial market, what causes a movement along the supply curve? What causes a shift in the supply curve?
Hint:
Changes in the interest rate (i.e., the price of financial capital) cause a movement along the supply curve. A change in anything else that affects the supply of financial capital (a non-price variable) such as income or future needs would shift the supply curve.
If a usury law limits interest rates to no more than 35%, what would the likely impact be on the amount of loans made and interest rates paid?
Hint:
If market interest rates stay in their normal range, an interest rate limit of 35% would not be binding. If the equilibrium interest rate rose above 35%, the interest rate would be capped at that rate, and the quantity of loans would be lower than the equilibrium quantity, causing a shortage of loans.
Which of the following changes in the financial market will lead to a decline in interest rates:
- a rise in demand
- a fall in demand
- a rise in supply
- a fall in supply
Hint:
b and c will lead to a fall in interest rates. At a lower demand, lenders will not be able to charge as much, and with more available lenders, competition for borrowers will drive rates down.
Which of the following changes in the financial market will lead to an increase in the quantity of loans made and received:
- a rise in demand
- a fall in demand
- a rise in supply
- a fall in supply
Hint:
a and c will increase the quantity of loans. More people who want to borrow will result in more loans being given, as will more people who want to lend.
Review Questions
How do economists define equilibrium in financial markets?
What would be a sign of a shortage in financial markets?
Would usury laws help or hinder resolution of a shortage in financial markets?
Critical Thinking Questions
Suppose the U.S. economy began to grow more rapidly than other countries in the world. What would be the likely impact on U.S. financial markets as part of the global economy?
If the government imposed a federal interest rate ceiling of 20% on all loans, who would gain and who would lose?
Problems
Predict how each of the following economic changes will affect the equilibrium price and quantity in the financial market for home loans. Sketch a demand and supply diagram to support your answers.
- The number of people at the most common ages for home-buying increases.
- People gain confidence that the economy is growing and that their jobs are secure.
- Banks that have made home loans find that a larger number of people than they expected are not repaying those loans.
- Because of a threat of a war, people become uncertain about their economic future.
- The overall level of saving in the economy diminishes.
- The federal government changes its bank regulations in a way that makes it cheaper and easier for banks to make home loans.
Table shows the amount of savings and borrowing in a market for loans to purchase homes, measured in millions of dollars, at various interest rates. What is the equilibrium interest rate and quantity in the capital financial market? How can you tell? Now, imagine that because of a shift in the perceptions of foreign investors, the supply curve shifts so that there will be $10 million less supplied at every interest rate. Calculate the new equilibrium interest rate and quantity, and explain why the direction of the interest rate shift makes intuitive sense.
| Interest Rate | Qs | Qd |
|---|---|---|
| 5% | 130 | 170 |
| 6% | 135 | 150 |
| 7% | 140 | 140 |
| 8% | 145 | 135 |
| 9% | 150 | 125 |
| 10% | 155 | 110 |
References
CreditCards.com. 2013. http://www.creditcards.com/credit-card-news/credit-card-industry-facts-personal-debt-statistics-1276.php.
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oercommons
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2025-03-18T00:36:46.456618
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"license": "Creative Commons - Attribution - https://creativecommons.org/licenses/by/4.0/",
"url": "https://oercommons.org/courseware/lesson/28789/overview",
"title": "Principles of Macroeconomics 2e, Labor and Financial Markets",
"author": null
}
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https://oercommons.org/courseware/lesson/28790/overview
|
The Market System as an Efficient Mechanism for Information
Overview
By the end of this section, you will be able to:
- Apply demand and supply models to analyze prices and quantities
- Explain the effects of price controls on the equilibrium of prices and quantities
Prices exist in markets for goods and services, for labor, and for financial capital. In all of these markets, prices serve as a remarkable social mechanism for collecting, combining, and transmitting information that is relevant to the market—namely, the relationship between demand and supply—and then serving as messengers to convey that information to buyers and sellers. In a market-oriented economy, no government agency or guiding intelligence oversees the set of responses and interconnections that result from a change in price. Instead, each consumer reacts according to that person’s preferences and budget set, and each profit-seeking producer reacts to the impact on its expected profits. The following Clear It Up feature examines the demand and supply models.
Why are demand and supply curves important?
The demand and supply model is the second fundamental diagram for this course. (The opportunity set model that we introduced in the Choice in a World of Scarcity chapter was the first.) Just as it would be foolish to try to learn the arithmetic of long division by memorizing every possible combination of numbers that can be divided by each other, it would be foolish to try to memorize every specific example of demand and supply in this chapter, this textbook, or this course. Demand and supply is not primarily a list of examples. It is a model to analyze prices and quantities. Even though demand and supply diagrams have many labels, they are fundamentally the same in their logic. Your goal should be to understand the underlying model so you can use it to analyze any market.
Figure displays a generic demand and supply curve. The horizontal axis shows the different measures of quantity: a quantity of a good or service, or a quantity of labor for a given job, or a quantity of financial capital. The vertical axis shows a measure of price: the price of a good or service, the wage in the labor market, or the rate of return (like the interest rate) in the financial market.
The demand and supply model can explain the existing levels of prices, wages, and rates of return. To carry out such an analysis, think about the quantity that will be demanded at each price and the quantity that will be supplied at each price—that is, think about the shape of the demand and supply curves—and how these forces will combine to produce equilibrium.
We can also use demand and supply to explain how economic events will cause changes in prices, wages, and rates of return. There are only four possibilities: the change in any single event may cause the demand curve to shift right or to shift left, or it may cause the supply curve to shift right or to shift left. The key to analyzing the effect of an economic event on equilibrium prices and quantities is to determine which of these four possibilities occurred. The way to do this correctly is to think back to the list of factors that shift the demand and supply curves. Note that if more than one variable is changing at the same time, the overall impact will depend on the degree of the shifts. When there are multiple variables, economists isolate each change and analyze it independently.
An increase in the price of some product signals consumers that there is a shortage; therefore, they may want to economize on buying this product. For example, if you are thinking about taking a plane trip to Hawaii, but the ticket turns out to be expensive during the week you intend to go, you might consider other weeks when the ticket might be cheaper. The price could be high because you were planning to travel during a holiday when demand for traveling is high. Maybe the cost of an input like jet fuel increased or the airline has raised the price temporarily to see how many people are willing to pay it. Perhaps all of these factors are present at the same time. You do not need to analyze the market and break down the price change into its underlying factors. You just have to look at the ticket price and decide whether and when to fly.
In the same way, price changes provide useful information to producers. Imagine the situation of a farmer who grows oats and learns that the price of oats has risen. The higher price could be due to an increase in demand caused by a new scientific study proclaiming that eating oats is especially healthful. Perhaps the price of a substitute grain, like corn, has risen, and people have responded by buying more oats. The oat farmer does not need to know the details. The farmer only needs to know that the price of oats has risen and that it will be profitable to expand production as a result.
The actions of individual consumers and producers as they react to prices overlap and interlock in markets for goods, labor, and financial capital. A change in any single market is transmitted through these multiple interconnections to other markets. The vision of the role of flexible prices helping markets to reach equilibrium and linking different markets together helps to explain why price controls can be so counterproductive. Price controls are government laws that serve to regulate prices rather than allow the various markets to determine prices. There is an old proverb: “Don’t kill the messenger.” In ancient times, messengers carried information between distant cities and kingdoms. When they brought bad news, there was an emotional impulse to kill the messenger. However, killing the messenger did not kill the bad news. Moreover, killing the messenger had an undesirable side effect: Other messengers would refuse to bring news to that city or kingdom, depriving its citizens of vital information.
Those who seek price controls are trying to kill the messenger—or at least to stifle an unwelcome message that prices are bringing about the equilibrium level of price and quantity. However, price controls do nothing to affect the underlying forces of demand and supply, and this can have serious repercussions. During China’s “Great Leap Forward” in the late 1950s, the government kept food prices artificially low, with the result that 30 to 40 million people died of starvation because the low prices depressed farm production. This was communist party leader Mao Zedong's social and economic campaign to rapidly transform the country from an agrarian economy to a socialist society through rapid industrialization and collectivization. Changes in demand and supply will continue to reveal themselves through consumers’ and producers’ behavior. Immobilizing the price messenger through price controls will deprive everyone in the economy of critical information. Without this information, it becomes difficult for everyone—buyers and sellers alike—to react in a flexible and appropriate manner as changes occur throughout the economy.
Baby Boomers Come of Age
The theory of supply and demand can explain what happens in the labor markets and suggests that the demand for nurses will increase as healthcare needs of baby boomers increase, as Figure shows. The impact of that increase will result in an average salary higher than the $67,490 earned in 2015 referenced in the first part of this case. The new equilibrium (E1) will be at the new equilibrium price (Pe1).Equilibrium quantity will also increase from Qe0 to Qe1.
Suppose that as the demand for nurses increases, the supply shrinks due to an increasing number of nurses entering retirement and increases in the tuition of nursing degrees. The leftward shift of the supply curve in Figure captures the impact of a decreasing supply of nurses. The shifts in the two curves result in higher salaries for nurses, but the overall impact in the quantity of nurses is uncertain, as it depends on the relative shifts of supply and demand.
While we do not know if the number of nurses will increase or decrease relative to their initial employment, we know they will have higher salaries.
Key Concepts and Summary
The market price system provides a highly efficient mechanism for disseminating information about relative scarcities of goods, services, labor, and financial capital. Market participants do not need to know why prices have changed, only that the changes require them to revisit previous decisions they made about supply and demand. Price controls hide information about the true scarcity of products and thereby cause misallocation of resources.
Self-Check Questions
Identify the most accurate statement. A price floor will have the largest effect if it is set:
- substantially above the equilibrium price
- slightly above the equilibrium price
- slightly below the equilibrium price
- substantially below the equilibrium price
Sketch all four of these possibilities on a demand and supply diagram to illustrate your answer.
Hint:
A price floor prevents a price from falling below a certain level, but has no effect on prices above that level. It will have its biggest effect in creating excess supply (as measured by the entire area inside the dotted lines on the graph, from D to S) if it is substantially above the equilibrium price. This is illustrated in the following figure.
It will have a lesser effect if it is slightly above the equilibrium price. This is illustrated in the next figure.
It will have no effect if it is set either slightly or substantially below the equilibrium price, since an equilibrium price above a price floor will not be affected by that price floor. The following figure illustrates these situations.
A price ceiling will have the largest effect:
- substantially below the equilibrium price
- slightly below the equilibrium price
- substantially above the equilibrium price
- slightly above the equilibrium price
Sketch all four of these possibilities on a demand and supply diagram to illustrate your answer.
Hint:
A price ceiling prevents a price from rising above a certain level, but has no effect on prices below that level. It will have its biggest effect in creating excess demand if it is substantially below the equilibrium price. The following figure illustrates these situations.
When the price ceiling is set substantially or slightly above the equilibrium price, it will have no effect on creating excess demand. The following figure illustrates these situations.
Select the correct answer. A price floor will usually shift:
- demand
- supply
- both
- neither
Illustrate your answer with a diagram.
Hint:
Neither. A shift in demand or supply means that at every price, either a greater or a lower quantity is demanded or supplied. A price floor does not shift a demand curve or a supply curve. However, if the price floor is set above the equilibrium, it will cause the quantity supplied on the supply curve to be greater than the quantity demanded on the demand curve, leading to excess supply.
Select the correct answer. A price ceiling will usually shift:
- demand
- supply
- both
- neither
Hint:
Neither. A shift in demand or supply means that at every price, either a greater or a lower quantity is demanded or supplied. A price ceiling does not shift a demand curve or a supply curve. However, if the price ceiling is set below the equilibrium, it will cause the quantity demanded on the demand curve to be greater than the quantity supplied on the supply curve, leading to excess demand.
Review Question
Whether the product market or the labor market, what happens to the equilibrium price and quantity for each of the four possibilities: increase in demand, decrease in demand, increase in supply, and decrease in supply.
Critical Thinking Questions
Why are the factors that shift the demand for a product different from the factors that shift the demand for labor? Why are the factors that shift the supply of a product different from those that shift the supply of labor?
During a discussion several years ago on building a pipeline to Alaska to carry natural gas, the U.S. Senate passed a bill stipulating that there should be a guaranteed minimum price for the natural gas that would flow through the pipeline. The thinking behind the bill was that if private firms had a guaranteed price for their natural gas, they would be more willing to drill for gas and to pay to build the pipeline.
- Using the demand and supply framework, predict the effects of this price floor on the price, quantity demanded, and quantity supplied.
- With the enactment of this price floor for natural gas, what are some of the likely unintended consequences in the market?
- Suggest some policies other than the price floor that the government can pursue if it wishes to encourage drilling for natural gas and for a new pipeline in Alaska.
Problems
Imagine that to preserve the traditional way of life in small fishing villages, a government decides to impose a price floor that will guarantee all fishermen a certain price for their catch.
- Using the demand and supply framework, predict the effects on the price, quantity demanded, and quantity supplied.
- With the enactment of this price floor for fish, what are some of the likely unintended consequences in the market?
- Suggest some policies other than the price floor to make it possible for small fishing villages to continue.
What happens to the price and the quantity bought and sold in the cocoa market if countries producing cocoa experience a drought and a new study is released demonstrating the health benefits of cocoa? Illustrate your answer with a demand and supply graph.
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oercommons
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2025-03-18T00:36:46.486093
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"url": "https://oercommons.org/courseware/lesson/28790/overview",
"title": "Principles of Macroeconomics 2e, Labor and Financial Markets",
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https://oercommons.org/courseware/lesson/25867/overview
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Chapter 10: Active Listening in the Classroom
Overview
Learning Framework: Effective Strategies for College Success
Chapter 10: Active Listening in the Classroom
Learning Objectives
By the end of this chapter, you will be able to:
- Explain why regular class attendance class is important.
- Understand the stages of the listening process.
- Identify effective listening strategies.
- Identify effective participation strategies.
- Identify strategies for obtaining content from a class you missed.
- Evaluate different teaching styles and how your personal learning style fit with each.
- Define active learning.
Active Listening in the Classroom
Active Listening in the Classroom
Why Go To Class?
Students don’t always want to go to class. They may have required classes that they find difficult or don’t enjoy, or they may feel overwhelmed by other commitments or feel tired if they have early morning classes. However, even if instructors allow a certain number of unexcused absences, you should aim to attend every class session. Class attendance enhances class performance in the following ways:
- Class participation: If you don’t attend class, you can’t participate in-class activities. Class activities are usually part of your final grade, and they can help you apply concepts you learn from lectures and reading assignments.
- Class interaction: If you rely on learning on your own (by doing the reading assignments outside of class, for example), you’ll miss out on class discussions with fellow students. Your classmates will often have the same questions as you, so going to class enables you to learn from them and ask your instructor about topics you all find difficult.
- Interaction with the instructor: There is a reason why classes are taught by instructors. Instructors specialize in the subjects they teach, and they can provide extra insight and perspective on the material you’re studying. Going to class gives you the chance to take notes and ask questions about the lectures. Also, the more you participate, the more your instructors will come to know you and be aware of any help or support you might need. This will make you feel more comfortable to approach them outside of class if you need advice or are struggling with the course material.
- Increased learning: Even though you will typically spend more time on coursework outside of the classroom, this makes class sessions even more valuable. Typically, in-class time will be devoted to the most challenging or key concepts covered in your textbooks. It’s important to know what these are so you can master them—also they’re likely to show up on exams.
Let’s compare students with different attitudes toward their classes:
Carlos wants to get through college, and he knows he needs the degree to get a decent job, but he’s just not that into it. He's never thought of himself as a good student, and that hasn’t changed much in college. He has trouble paying attention in those big lecture classes, which mostly seem pretty boring. He’s pretty sure he can pass all his courses as long as he takes the time to study before tests. It doesn’t bother him to skip classes when he’s studying for a test in a different class or finishing a reading assignment he didn’t get around to earlier. He does make it through his first year with a passing grade in every class, even those he didn’t go to very often. Then he fails the midterm exam in his first sophomore class. Depressed, he skips the next couple classes, then feels guilty and goes to the next. It’s even harder to stay awake because now he has no idea what they’re talking about. It’s too late to drop the course, and even a hard night of studying before the final isn’t enough to pass the course. In two other classes, he just barely passes. He has no idea what classes to take next term and is starting to think that maybe he’ll drop out for now.
Karen wants to have a good time in college and still do well enough to get a good job in business afterward. Her sorority keeps a file of class notes for her big lecture classes, and from talking to others and reviewing these notes, she’s discovered she can skip almost half of those big classes and still get a B or C on the tests. She stays focused on her grades, and because she has a good memory, she’s able to maintain OK grades. She doesn’t worry about talking to her instructors outside of class because she can always find out what she needs from another student. In her sophomore year, she has a quick conversation with her academic advisor and chooses her major. Those classes are smaller, and she goes to most of them, but she feels she’s pretty much figured out how it works and can usually still get the grade. In her senior year, she starts working on her résumé and asks other students in her major which instructors write the best letters of recommendation. She’s sure her college degree will land her a good job.
Logan enjoys their classes, even when they have to get up early after working or studying late the night before. They sometimes get so excited by something they learn in class that they rush up to the instructor after class to ask a question. In class discussions, they are not usually the first to speak out, but by the time another student has given an opinion, they have had time to organize their thoughts and enjoys arguing their ideas. Nearing the end of their sophomore year and unsure of what to major in given their many interests, they talk things over with one of their favorite instructors, whom they have gotten to know through office visits. The instructor gives Logan some insights into careers in that field and helps them explore their interests. Logan takes two more courses with this instructor over the next year, and they are comfortable in their senior year going to him to ask for a job reference. When they do, they're surprised and thrilled when he urges them to apply for a high-level paid internship with a company in the field—that happens to be run by a friend of his.
Think about the differences in the attitudes of these three students and how they approach their classes. One’s attitude toward learning, toward going to class, and toward the whole college experience is a huge factor in how successful a student will be. Make it your goal to attend every class; don’t even think about not going. Going to class is the first step in engaging in your education by interacting with the instructor and other students. Here are some reasons why it’s important to attend every class:
- Miss a class and you’ll miss something, even if you never know it. Even if a friend gives you notes for the class, they cannot contain everything said or shown by the instructor or written on the board for emphasis or questioned or commented on by other students. What you miss might affect your grade or your enthusiasm for the course. Why go to college at all if you’re not going to go to college?
- While some students may say that you don’t have to go to every class to do well on a test, that is very often a myth. Do you want to take that risk?
- Your final grade often reflects how you think about course concepts, and you will think more often and more clearly when engaged in class discussions and hearing the comments of other students. You can’t get this by borrowing class notes from a friend.
- Research shows there is a correlation between absences from class and lower grades. It may be that missing classes causes lower grades or that students with lower grades miss more classes. Either way, missing classes and lower grades can be intertwined in a downward spiral of achievement.
- Your instructor will note your absences, even in a large class. In addition to making a poor impression, you reduce your opportunities for future interactions. You might not ask a question the next class because of the potential embarrassment of the instructor saying that was covered in the last class, which you apparently missed. Nothing is more insulting to an instructor than when you skip a class and then show up to ask, “Did I miss anything important?”
- You might be tempted to skip a class because the instructor is “boring,” but it’s more likely that you found the class boring because you weren’t very attentive or didn’t appreciate how the instructor was teaching.
- You paid a lot of money for your tuition. Get your money’s worth!
Stages of the Listening Process
Listening is a skill of critical significance in all aspects of our lives, from maintaining our personal relationships, to getting our jobs done, to taking notes in class, to figuring out which bus to take to the airport. Regardless of how we’re engaged with listening, it’s important to understand that listening involves more than just hearing the words that are directed at us. Listening is an active process by which we make sense of, assess, and respond to what we hear.
The listening process involves five stages: receiving, understanding, evaluating, remembering, and responding. These stages will be discussed in more detail in later sections. An effective listener must hear and identify the speech sounds directed toward them, understand the message of those sounds, critically evaluate or assess that message, remember what’s been said, and respond (either verbally or nonverbally) to information they’ve received.
Effectively engaging in all five stages of the listening process lets us best gather the information we need from the world around us.
Active Listening
Active listening is a particular communication technique that requires the listener to provide feedback on what they hear to the speaker, by way of restating or paraphrasing what they have heard in their own words. The goal of this repetition is to confirm what the listener has heard and to confirm the understanding of both parties. The ability to actively listen demonstrates sincerity, and that nothing is being assumed or taken for granted. Active listening is most often used to improve personal relationships, reduce misunderstandings and conflicts, strengthen cooperation, and foster understanding.
When engaging with a particular speaker, a listener can use several degrees of active listening, each resulting in a different quality of communication with the speaker. This active listening chart shows three main degrees of listening: repeating, paraphrasing, and reflecting.
Active listening can also involve paying attention to the speaker’s behavior and body language. Having the ability to interpret a person’s body language lets the listener develop a more accurate understanding of the speaker’s message.
The Receiving Stage
The first stage of the listening process is the receiving stage, which involves hearing and attending.
Hearing is the physiological process of registering sound waves as they hit the eardrum. As obvious as it may seem, in order to effectively gather information through listening, we must first be able to physically hear what we’re listening to. The clearer the sound, the easier the listening process becomes.
Paired with hearing, attending is the other half of the receiving stage in the listening process. Attending is the process of accurately identifying and interpreting particular sounds we hear as words. The sounds we hear have no meaning until we give them their meaning in context. Listening is an active process that constructs meaning from both verbal and nonverbal messages.
The Challenges of Reception
Listeners are often bombarded with a variety of auditory stimuli all at once, so they must differentiate which of those stimuli are speech sounds and which are not. Effective listening involves being able to focus on speech sounds while disregarding other noise. For instance, a train passenger that hears the captain’s voice over the loudspeaker understands that the captain is speaking, then deciphers what the captain is saying despite other voices in the cabin. Another example is trying to listen to a friend tell a story while walking down a busy street. In order to best listen to what they're saying, the listener needs to ignore the ambient street sounds.
Attending also involves being able to discern human speech, also known as “speech segmentation. “ Identifying auditory stimuli as speech but not being able to break those speech sounds down into sentences and words would be a failure of the listening process. Discerning speech segmentation can be a more difficult activity when the listener is faced with an unfamiliar language.
The Understanding Stage
The second stage in the listening process is the understanding stage. Understanding or comprehension is “shared meaning between parties in a communication transaction” and constitutes the first step in the listening process. This is the stage during which the listener determines the context and meanings of the heard words. Determining the context and meaning of individual words, as well as assigning meaning in language, is essential to understanding sentences. This, in turn, is essential to understanding a speaker’s message.
Once the listener understands the speaker’s main point, they can begin to sort out the rest of the information they are hearing and decide where it belongs in their mental outline. For example, a political candidate listens to her opponent’s arguments to understand what policy decisions that opponent supports.
Before getting the big picture of a message, it can be difficult to focus on what the speaker is saying. Think about walking into a lecture class halfway through. You may immediately understand the words and sentences that you are hearing, but not immediately understand what the lecturer is proving or whether what you’re hearing at the moment is the main point, side note, or digression.
Understanding what we hear is a huge part of our everyday lives, particularly in terms of gathering basic information. In the office, people listen to their superiors for instructions about what they are to do. At school, students listen to teachers to learn new ideas. We listen to political candidates give policy speeches in order to determine who will get our vote. But without understanding what we hear, none of this everyday listening would relay any practical information to us.
One tactic for better understanding a speaker’s meaning is to ask questions. Asking questions allows the listener to fill in any holes they may have in the mental reconstruction of the speaker’s message.
The Evaluating Stage
This stage of the listening process is the one during which the listener assesses the information they received, both qualitatively and quantitatively. Evaluating allows the listener to form an opinion of what they heard and, if necessary, to begin developing a response.
During the evaluating stage, the listener determines whether or not the information they heard and understood from the speaker is well constructed or disorganized, biased or unbiased, true or false, significant or insignificant. They also ascertain how and why the speaker has come up with and conveyed the message that they delivered. This may involve considerations of a speaker’s personal or professional motivations and goals. For example, a listener may determine that a co-worker’s vehement condemnation of another for jamming the copier is factually correct, but may also understand that the co-worker’s child is sick and that may be putting them on edge. A voter who listens to and understands the points made in a political candidate’s stump speech can decide whether or not those points were convincing enough to earn their vote.
The evaluating stage occurs most effectively once the listener fully understands what the speaker is trying to say. While we can, and sometimes do, form opinions of information and ideas that we don’t fully understand—or even that we misunderstand—doing so is not often ideal in the long run. Having a clear understanding of a speaker’s message allows a listener to evaluate that message without getting bogged down in ambiguities or spending unnecessary time and energy addressing points that may be tangential or otherwise non-essential.
This stage of critical analysis is important for a listener in terms of how what they heard will affect their own ideas, decisions, actions, and/or beliefs.
The Remembering Stage
In the listening process, the remembering stage occurs as the listener categorizes and retains the information he’s gathered from the speaker for future access. The result–memory–allows the person to record information about people, objects, and events for later recall. This happens both during and after the speaker’s delivery.
Memory is essential throughout the listening process. We depend on our memory to fill in the blanks when we’re listening and to let us place what we’re hearing at the moment in the context of what we’ve heard before. If, for example, you forgot everything that you heard immediately after you heard it, you would not be able to follow along with what a speaker says, and conversations would be impossible. Moreover, a friend who expresses fear about a dog they see on the sidewalk ahead can help you recall that the friend began the conversation with her childhood memory of being attacked by a dog.
Remembering previous information is critical to moving forward. Similarly, making associations to past remembered information can help a listener understand what they are currently hearing in a wider context. In listening to a lecture about the symptoms of depression, for example, a listener might make a connection to the description of a character in a novel that they read years before.
Using information immediately after receiving it enhances information retention and lessens the forgetting curve or the rate at which we no longer retain information in our memory. Conversely, retention is lessened when we engage in mindless listening, and little effort is made to understand a speaker’s message.
Because everyone has different memories, the speaker and the listener may attach different meanings to the same statement. In this sense, establishing common ground in terms of context is extremely important, both for listeners and speakers.
The Responding Stage
The responding stage is the stage of the listening process wherein the listener provides verbal and/or nonverbal reactions based on short- or long-term memory. Following the remembering stage, a listener can respond to what they hear either verbally or non-verbally. Nonverbal signals can include gestures such as nodding, making eye contact, tapping a pen, fidgeting, scratching or cocking their head, smiling, rolling their eyes, grimacing, or any other body language. These kinds of responses can be displayed purposefully or involuntarily. Responding verbally might involve asking a question, requesting additional information, redirecting or changing the focus of a conversation, cutting off a speaker, or repeating what a speaker has said back to her in order to verify that the received message matches the intended message.
Nonverbal responses like nodding or eye contact allow the listener to communicate their level of interest without interrupting the speaker, thereby preserving the speaker/listener roles. When a listener responds verbally to what they hear and remember—for example, with a question or a comment—the speaker/listener roles are reversed, at least momentarily.
Responding adds action to the listening process, which would otherwise be an outwardly passive process. Oftentimes, the speaker looks for verbal and nonverbal responses from the listener to determine if and how their message is being understood and/or considered. Based on the listener’s responses, the speaker can choose to either adjust or continue with the delivery of her message. For example, if a listener’s brow is furrowed and their arms are crossed, the speaker may determine that they need to lighten their tone to better communicate their point. If a listener is smiling and nodding or asking questions, the speaker may feel that the listener is engaged and her message is being communicated effectively.
Effective Listening Strategies
Too many students try to get the grade just by going to class, maybe a little note-taking, and then cramming through the text right before an exam they feel unprepared for. Sound familiar? This approach may have worked for you in high school where tests and quizzes were more frequent and teachers prepared study guides for you, but colleges require you to take responsibility for your learning and to be better prepared.
Most students simply have not learned how to study and don’t understand how learning works. Learning is actually a cycle of four steps:
- Preparing
- Absorbing
- Capturing
- Reviewing
When you get in the habit of paying attention to this cycle, it becomes relatively easy to study well. But you must use all four steps.
This chapter focuses on listening, a key skill for learning new material. The next chapter focuses on note-taking, the most important skill in the capturing phase of the cycle. These skills are closely related. Good listening skills make you a better note-taker, and taking good notes can help you listen better. Both are key study skills to help you do better in your classes.
The Learning Cycle
Are you a good listener? Most of us like to think we are, but when we really think about it, we recognize that we are often only half-listening. We’re distracted, thinking about other things, or formulating what we are going to say in reaction to what we are hearing before the speaker has even finished. Effective listening is one of the most important learning tools you can have in college. And it is a skill that will benefit you on the job and help your relationships with others. Listening is nothing more than purposefully focusing on what a speaker is saying with the objective of understanding.
This definition is straightforward, but there are some important concepts that deserve a closer look. “Purposefully focusing” implies that you are actively processing what the speaker is saying, not just letting the sounds of their voice register in your senses. “With the objective of understanding” means that you will learn enough about what the speaker is saying to be able to form your own thoughts about the speaker’s message. Listening is an active process, as opposed to hearing, which is passive.
You listen to others in many situations: to interact with friends, to get instructions for a task, or to learn new material. There are two general types of listening situations: where you will be able to interact freely with the speaker (everyday conversations, small discussion classes, business meetings) and where interaction is limited (lectures and Webcasts).
In interactive situations, you should apply the basic principles of active listening. These are not hard to understand, but they are hard to implement and require practice to use them effectively.
Principles of Active Listening
- Focus on what is being said. Give the speaker your undivided attention. Clear your mind of anything else.
- Don’t prejudge or assume you already know the material. You want to understand what the person is saying; you don’t need to agree with it.
- Repeat what you just heard. Confirm with the speaker that what you heard is what they said.
- Ask the speaker to expand or clarify. If you are unsure you understand, ask questions; don’t assume.
- Listen for verbal cues and watch for nonverbal cues. Verbal cues are things your instructor says that communicate the importance. Examples are, “This is an important point” or “I want to make sure everyone understands this concept.” Your instructor is telling you what is most important. Nonverbal cues come from facial expressions, body positioning, arm gestures, and tone of voice. Examples include when the instructor repeats herself, gets louder, or starts using more hand gestures.
- Listen for requests. A speaker will often hide a request as a statement of a problem. If a friend says, “I hate math!” this may mean, “Can you help me figure out a solution to this problem?”
Listening in a classroom or lecture hall to learn can be challenging because you are limited by how, and how much, you can interact with an instructor during the class. The following strategies help make listening at lectures more effective and learning more fun.
- Get your mind in the right space. Prepare yourself mentally to receive the information the speaker is presenting by following the previous prep questions and by doing your assignments (instructors build upon work presented earlier).
- Get yourself in the right space. Sit toward the front of the room where you can make eye contact with the instructor easily. Most instructors read the body language of the students in the front rows to gauge how they are doing and if they are losing the class. Instructors also believe students who sit near the front of the room take their subject more seriously and are more willing to give them help when needed or to give them the benefit of the doubt when making a judgment call while assigning grades.
- Eliminate distractions. There are two types of distractions: internal and external distractions.
- Internal distractions are things like being hungry, tired, or distracted by other thoughts. Try to manage these by being well-rested and having a healthy meal before class.
- External distractions are things like a ringing cell phone or people talking in the hallway. To manage these distractions, turn your cell phone off and pack it away in your backpack. If you are using your laptop for notes, close all applications except the one that you use to take notes.
- Look for signals. Each instructor has a different way of telling you what is important. Some will repeat or paraphrase an idea; others will raise (or lower) their voices; others will write related words on the board. Learn what signals your instructors tend to use and be on the lookout for them. When they use that tactic, the idea they are presenting needs to go in your notes and in your mind—and don’t be surprised if it appears on a test or quiz!
- Listen for what is not being said. If an instructor doesn’t cover a subject or covers it only minimally, this signals that that material is not as important as other ideas covered in greater length.
- Sort the information. Decide what is important and what is not, what is clear and what is confusing, and what is new material and what is a review. This mental organizing will help you remember the information, take better notes, and ask better questions.
- Take notes. We cover taking notes in much greater detail later in the next chapter, but for now, think about how taking notes can help recall what your instructor said and how notes can help you organize your thoughts for asking questions.
- Ask questions. Asking questions is one of the most important things you can do in class. Most obviously it allows you to clear up any doubts you may have about the material, but it also helps you take ownership of (and therefore remember) the material. Good questions often help instructors expand upon their ideas and make the material more relevant to students. Thinking through the material critically in order to prepare your questions helps you organize your new knowledge and sort it into mental categories that will help you remember it.
What to Do If…
- Your instructor speaks too fast. Crank up your preparation. The more you know about the subject, the more you’ll be able to pick up from the instructor. Exchange class notes with other students to fill in gaps in notes. Visit the instructor during office hours to clarify areas you may have missed. You might ask the instructor—very politely, of course—to slow down, but habits like speaking fast are hard to break!
- Your instructor has a heavy accent. Sit as close to the instructor as possible. Make connections between what the instructor seems to be saying and what they are presenting on the board or screen. Ask questions when you don’t understand. Visit the instructor during office hours; the more you speak with the instructor the more likely you will learn to understand the accent.
- Your instructor speaks softly or mumbles. Sit as close to the instructor as possible and try to hold eye contact as much as possible. Check with other students if they are having problems listening, too; if so, you may want to bring the issue up with the instructor. It may be that the instructor is not used to the lecture hall your class is held in and can easily make adjustments.
Now That’s a Good Question…
Are you shy about asking questions? Do you think that others in the class will ridicule you for asking a dumb question? Students sometimes feel this way because they have never been taught how to ask questions. Practice these steps, and soon you will be on your way to customizing each course to meet your needs and letting the instructor know you value the course.
- Be prepared. Doing your assignments for a class or lecture will give you a good idea about the areas you are having trouble with and will help you frame some questions ahead of time.
- Position yourself for success. Sit near the front of the class. It will be easier for you to make eye contact with the instructor as you ask the question. Also, you won’t be intimidated by a class full of heads turning to stare at you as you ask your question.
- Don’t wait. Ask your questions as soon as the instructor has finished a thought. Being one of the first students to ask a question also will ensure that your question is given the time it deserves and won’t be cut short by the end of class.
- In a lecture class, write your questions down. Make sure you jot your questions down as they occur to you. Some may be answered in the course of the lecture, but if the instructor asks you to hold your questions until the end of class, you’ll be glad you have a list of the items you need the instructor to clarify or expand on.
- Ask specific questions. “I don’t understand” is a statement, not a question. Give the instructor guidance about what you are having trouble with. “Can you clarify the use of the formula for determining velocity?” is a better way of asking for help. If you ask your question at the end of class, give the instructor some context for your question by referring to the part of the lecture that triggered the question. For example, “Professor, you said the Union troops were emboldened by Lincoln’s leadership. Was this throughout the Civil War, or only after Gettysburg?”
- Don’t ask questions for the sake of asking questions. If your question is not thought out, or if it appears that you are asking the question to try to look smart, instructors will see right through you!
Effective Participation Strategies
Like listening, participating in class will help you get more out of class. It may also help you stand out as a student. Instructors notice the students who participate in class (and those who don’t), and participation is often a component of the final grade. “Participation” may include contributing to discussions, class activities, or projects. It means being actively involved. The following are some strategies for effective participation:
- Be a team player: Although most students have classmates they prefer to work with, they should be willing to collaborate in different types of groups. Teamwork demonstrates that a student can adapt to and learn in different situations.
- Share meaningful questions and comments: Some students speak up in class repeatedly if they know that participation is part of their grade. Although there isn’t necessarily anything wrong with this, it’s a good practice to focus on quality vs. quantity. For instance, a quieter student who raises her hand only twice during a discussion but provides thoughtful comments might be more noticeable to an instructor than a student who chimes in with everything that’s said.
- Be prepared: As with listening, effective participation relies on coming to class prepared. Students should complete all reading assignments beforehand and also review any notes from the previous meeting. This way they can come to class ready to discuss and engage. Be sure to write down any questions or comments you have—this is an especially good strategy for quieter students or those who need practice thinking on their feet.
The resource Class Participation: More Than Just Raising Your Hand can help you evaluate what you need to work on in order to participate in class more effectively.
Guidelines for Participating in Classes
Smaller classes generally favor discussion, but often instructors in large lecture classes also make some room for participation.
A concern or fear about speaking in public is one of the most common fears. If you feel afraid to speak out in class, take comfort from the fact that many others do as well—and that anyone can learn how to speak in class without much difficulty. Class participation is actually an impromptu, informal type of public speaking, and the same principles will get you through both: preparing and communicating.
- Set yourself up for success by coming to class fully prepared.
- Complete reading assignments.
- Review your notes on the reading and previous class to get yourself in the right mindset.
- If there is something you don’t understand well, start formulating your question now.
- Sit in the front with a good view of the instructor, board or screen, and other visual aids. In a lecture hall, this will help you hear better, pay better attention, and make a good impression on the instructor. Don’t sit with friends—socializing isn’t what you’re there for.
- Remember that your body language communicates as much as anything you say. Sit up and look alert, with a pleasant expression on your face, and make good eye contact with the instructor. Show some enthusiasm.
- Pay attention to the instructor’s body language, which can communicate much more than just words. How the instructor moves and gestures, and the looks on their face, will add meaning to the words—and will also cue you when it’s a good time to ask a question or stay silent.
- Take good notes, but don’t write obsessively—and never page through your textbook (or browse on a laptop).
- Don’t eat or play with your cell phone.
- Except when writing brief notes, keep your eyes on the instructor.
- Follow class protocol for making comments and asking questions.
- In a small class, the instructor may encourage students to ask questions at any time, while in some large lecture classes, the instructor may for ask questions at the end of the lecture. In this case, jot your questions in your notes so that you don’t forget them later.
- Don’t say or ask anything just to try to impress your instructor. Most instructors have been teaching long enough to immediately recognize insincere flattery—and the impression this makes is just the opposite of what you want.
- Pay attention to the instructor’s thinking style. Does this instructor emphasize theory more than facts, wide perspectives over specific ideas, abstractions more than concrete experience? Take a cue from your instructor’s approach and try to think in similar terms when participating in class.
- It’s fine to disagree with your instructor when you ask or answer a question. Many instructors invite challenges. Before speaking up, however, be sure you can explain why you disagree and give supporting evidence or reasons. Be respectful.
- Pay attention to your communication style. Use standard English when you ask or answer a question, not slang. Avoid sarcasm and joking around. Be assertive when you participate in class, showing confidence in your ideas while being respectful of the ideas of others. But avoid an aggressive style that attacks the ideas of others or is strongly emotional.
When your instructor asks a question to the class:
- Raise your hand and make eye contact, but don’t call out or wave your hand all around trying to catch their attention.
- Before speaking, take a moment to gather your thoughts and take a deep breath. Don’t just blurt it out—speak calmly and clearly.
When your instructor asks you a question directly:
- Be honest and admit it if you don’t know the answer or are not sure. Don’t try to fake it or make excuses. With a question that involves a reasoned opinion more than a fact, it’s fine to explain why you haven’t decided yet, such as when weighing two opposing ideas or actions; your comment may stimulate further discussion.
- Organize your thoughts to give a sufficient answer. Instructors seldom want a yes or no answer. Give your answer and provide reasons or evidence in support.
When you want to ask the instructor a question:
- Don’t ever feel a question is “stupid.” If you have been paying attention in class and have done the reading and you still don’t understand something, you have every right to ask.
- Ask at the appropriate time. Don’t interrupt the instructor or jump ahead and ask a question about something the instructor may be starting to explain. Wait for a natural pause and a good moment to ask. On the other hand, unless the instructor asks students to hold all questions until the end of class, don’t let too much time go by, or you may forget the question or its relevance to the topic.
- Don’t ask just because you weren’t paying attention. If you drift off during the first half of class and then realize in the second half that you don’t really understand what the instructor is talking about now, don’t ask a question about something that was already covered.
- Don’t ask a question that is really a complaint. You may be thinking, “Why would so-and-so believe that? That’s just crazy!” Take a moment to think about what you might gain from asking the question. It’s better to say, “I’m having some difficulty understanding what so-and-so is saying here. What evidence did they use to argue for that position?”
- Avoid dominating a discussion. It may be appropriate in some cases to make a follow-up comment after the instructor answers your question, but don’t try to turn the class into a one-on-one conversation between you and the instructor.
Lecture Hall Classes
Tom Woodward – Undercover – CC BY-NC 2.0.
While opportunities are fewer for student discussions in large lecture classes, participation is still important. The instructor almost always provides an opportunity to ask questions. Because time is limited, be ready with your question or comment when the opportunity arises, and don’t be shy about raising your hand first.
Being prepared is especially important in lecture classes. Have assigned readings done before class and review your notes. If you have a genuine question about something in the reading, ask about it. Jot down the question in your notes and be ready to ask if the lecture doesn’t clear it up for you.
Being prepared before asking a question also includes listening carefully to the lecture. You don’t want to ask a question whose answer was already given by the instructor in the lecture. Take a moment to organize your thoughts and choose your words carefully. Be as specific as you can. Don’t say something like, “I don’t understand the big deal about whether the earth revolves around the sun or the sun around the earth. So what?” Instead, you might ask, “When they discovered that the earth revolves around the sun, was that such a disturbing idea because people were upset to realize that maybe they weren’t the center of the universe?” The first question suggests you haven’t thought much about the topic, while the second shows that you are beginning to grasp the issue and want to understand it more fully.
Following are some additional guidelines for asking good questions:
- Ask a question or two early in the term, even on the first day of class. Once the instructor has “noticed” you as a class participant, you are more likely to be recognized again when you have a question. You won’t be lost in the crowd.
- Speak deliberately and professionally, not as you might when talking with a friend. Use standard English rather than slang.
- If you’re very shy about public speaking or worried you’ll say the wrong thing, write down your question before asking. Rehearse it in your mind.
- When you have the opportunity to ask questions in class, it’s better to ask right away rather than saving a question for after class. If you really find it difficult to speak up in a large class, this is an acceptable way to ask your question and participate. A private conversation with an instructor may also be more appropriate if the question involves a paper or other project you are working on for the course.
A note on technology in the lecture hall. Colleges are increasingly incorporating new technology in lecture halls. For example, each student in the lecture hall may have an electronic “clicker” with which the instructor can gain instant feedback on questions in class. Or the classroom may have wireless Internet and students are encouraged to use their laptops to communicate with the instructor in “real-time” during the lecture. In these cases, the most important thing is to take it seriously, even if you have anonymity. Most students appreciate the ability to give feedback and ask questions through such technology, but some abuse their anonymity by sending irrelevant, disruptive, or insulting messages.
If You Must Miss a Class…
- Plan in advance: Although nobody can plan to be sick, students should give their instructors advanced notice if they know they will need to miss class for something like a doctor’s appointment. This is not only respectful to the instructor, but they may be able to give you any handouts or assignments that you might otherwise miss. If you anticipate that class will be canceled on account of bad weather, etc., make sure you have all the materials, notes, etc. that you need to work at home. In college, “snow days” are rarely “free days”—i.e., expect that you will be responsible for all the work due on those days when school reopens.
- Talk to fellow students: Ask to borrow class notes from one or two classmates who are reliable note takers. Be sure to also ask them about any announcements or assignments the instructor made during the class you missed.
- Talk to your instructor: Even if you have already emailed or called your instructor, check in with him or her before or after the next class period to collect any missed handouts and ask if anything was assigned. While you can’t expect the instructor to repeat the lecture, you can ask what you should do to stay caught up. But remember the worst thing you can say to an instructor: “I missed class—did you talk about anything important?”
- Do the reading assignment(s) and any other homework. Take notes on any readings to be discussed in the class you missed. If you have questions on the reading or homework, seek help from your classmates. Completing the homework and coming prepared for the next session will demonstrate to your instructor that you are still dedicated to the class.
Teaching Style Versus Learning Preferences
As you learned in Unit 3, students have many different types of multiple intelligences and strenghts and weaknesses. Understanding your stengths and preferences can help you study more effectively. Most instructors tend to develop their own teaching style, however, and you will encounter different teaching styles in different courses. Students can benefit from having instructors who teach in different ways because it can help them become more versatile as learners and able to work and communicate with a variety of people. Variety can be a challenge for students who prefer to learn in specific settings. However, learning to recognize different teaching styles can help students adjust to them and still be successful. Below are descriptions of some main teaching styles and how they relate to different learning preferences:
- Authority style: Instructors with an authority style of teaching prefer to give lectures while standing in front of the class, often doing a combination of talking and writing information on the board. Students are expected to listen and take notes. While the authority style may work for active/reflective students who can take notes to review later, it may be difficult for kinesthetic learners. These students could take advantage of their learning preferences by drawing study guides in their notes and creating and playing review games when they study with friends.
- Demonstrator style: Instructors with a demonstrator style of teaching prefer to lecture, also, but they prefer to “show” students what they’re explaining, often by using visual aids such as Powerpoint presentations, handouts, and demos. While this teaching style may appeal to visual learners and auditory learners who can simultaneously hear and visualize the information, this approach may not be as appealing to kinesthetic learners. These students might offer to assist instructors during demonstrations, so they can be more active while learning.
- Facilitator style: Instructors with a facilitator style rely heavily on class discussion, asking students to participate a lot while they provide prompts and guiding questions. While this teaching style is effective for students who may prefer interaction, students may want to create concept maps in their notes, which they can review later, while those with kinesthetic or naturalistic preferences may want to write their notes on index cards to use for studying outside of class.
- Delegator style: Instructors with a delegator approach prefer to structure their classes around student-run projects and presentations—their own teaching takes a backseat to students teaching one another. While this teaching style may be beneficial for those tht prefer an interactive or hands-on environment, most students will need to take notes throughout the projects and presentations so that they have study guides they can use later.
- Hybrid style: Instructors with a hybrid teaching style use a combination of the teaching styles above. For example, during an hourlong class session, they might schedule twenty minutes for a lecture, twenty minutes for class discussion, and twenty minutes for a class activity. While this teaching style can potentially appeal to all learning preferences, some students may have trouble adjusting to the shifts in format or activities. Still, such classes—especially the group activities—provide opportunities for different learning preferences: some might take notes or record everyone’s ideas, others could facilitate their group’s conversation, and other learners could be responsible for creating any props or presentations to share the group work with the rest of the class.
When the instructor’s teaching style matches your learning preferences, you are usually more attentive in class and may seem to learn better. But what happens if your instructor has a style very different from your own? Let’s say, for example, that your instructor primarily lectures, speaks rapidly, and seldom uses visuals. This instructor also talks mostly on the level of large abstract ideas and almost never gives examples. Let’s say that you, in contrast, prefer more visual demonstrations, that you prefer visual aids and visualizing concrete examples of ideas. Therefore, perhaps you are having some difficulty paying attention in class and following the lectures. What can you do?
- Capitalize on your learning strengths. In this example, you could use a visual style of note-taking, such as concept maps, while listening to the lecture. If the instructor does not give examples for abstract ideas in the lecture, see if you can supply examples in your own thoughts as you listen.
- Form a study group with other students. A variety of students will likely involve a variety of learning preferences, and when going over course material with other students, such as when studying for a test, you can gain what they have learned through their styles while you contribute what you have learned through yours.
- Use ancillary study materials. Many textbooks point students to online resource centers or include a computer CD that offers additional learning materials. Such ancillary materials usually offer an opportunity to review course material in ways that may better fit your learning preferences.
- Communicate with your instructor to bridge the gap between their teaching style and your learning preferences. If the instructor is speaking in abstractions and general ideas you don’t understand, ask the instructor for an example.
- You can also communicate with the instructor privately during office hours. For example, you can explain that you are having difficulty understanding lectures because so many things are said so fast.
Active Learning
Megan is currently taking two classes: geology and American literature. In her geology class, the instructor lectures for the full class time and gives reading assignments. In Megan’s literature class, however, the instructor relies on class discussions, small group discussions, and occasionally even review games. Megan enjoys her literature class, but she struggles to feel engaged and interested in geology.What strategies can Megan use to stay motivated and involved in both of her courses?
Think about the college classes you’ve taken so far. Like Megan, you may feel like it’s a mixed bag: you probably enjoyed the courses with a variety of teaching styles and learning activities the most. Even if you’re a quieter, more reserved student who dislikes lots of group discussions, you probably prefer to have some class projects or writing assignments rather than lectures alone. Group projects, discussions, and writing are examples of active learning because they involve doing something. Active learning happens when students participate in their education through activities that enhance learning. Those activities may involve just thinking about what you’re learning. Active learning can take place both in and out of the classroom. The following are examples of activities that can facilitate active engagement in the classroom.
Class discussions: Class discussions can help students stay focused because they feature different voices besides that of the instructor. Students can also hear one another’s questions and comments and learn from one another. Such discussions may involve the entire class, or the instructor may organize smaller groups, giving quieter students a greater chance to talk. Another method is to create online discussion boards so that students have more time to develop their ideas and comments and keep the conversation going.
Writing assignments: Instructors may ask students to write short reaction papers or journal entries about lessons or reading assignments. Such assignments can help students review or reflect on what they just learned to help them understand and remember the material, and also provide a means of communicating questions and concerns to their instructors.
Student-led teaching: Many instructors believe that a true test of whether students understand concepts is being able to teach the material to others. For that reason, instructors will sometimes have students work in groups and research a topic or review assigned readings, and then prepare a mini-presentation and teach it to the rest of the class. This activity can help students feel more accountable for their learning and work harder since classmates will be relying on them.
Group discussions are examples of active learning that encourage students to participate in their education.
KEY TAKEAWAYS
- Regular classroom attendance and participation is an essential part of the learning process.
- There are five stages to Active Listening: receiving, understanding, evaluating, responding and remembering.
- Learning is a cycle of four steps: preparing, absorbing, capturing and reviewing.
- Active Listening requires more than just class attendance. There are strategies to help you become an active listener.
- Participating in class, including answering and asking questions, is a vital part of the classroom experience.
- If you must miss a class, be proactive by making plans to get the missed materials and information.
- Just like there are different learning preferences, there are different teaching styles that you need to work with and respond to.
LICENSES AND ATTRIBUTIONS
LICENSES AND ATTRIBUTIONS
CC LICENSED CONTENT, ORIGINAL
- Active Listening in the Classroom. Authored by: Heather Syrett. Provided by: Austin Community College. License: CC BY-NC-SA-4.0
CC LICENSED CONTENT, SPECIFIC ATTRIBUTION
- Class Attendance in EDUC 1300. Authored by: Jolene Carr. Provided by: Lumen Learning. Located at: https://courses.lumenlearning.com/sanjacinto-learningframework/chapter/class-attendance/. License: CC BY 4.0
- Chapter 4: Listening, Taking Notes, and Remembering in College Success. Authored by: Anonymous. Provided by: University of Minnesota. Located at: http://www.oercommons.org/courses/college-success/view. License: CC BY-NC-SA-4.0
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oercommons
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2025-03-18T00:36:46.536523
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"url": "https://oercommons.org/courseware/lesson/25867/overview",
"title": "Learning Framework: Effective Strategies for College Success, Strategies for Academic Success",
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https://oercommons.org/courseware/lesson/25868/overview
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Chapter 11: Note-Taking Strategies
Overview
Learning Framework: Effective Strategies for College Success
Chapter 11: Note-Taking Strategies
Learning Objectives
By the end of this chapter, you will be able to:
- Explain why taking notes is important.
- Use the four primary methods of note taking: lists, outlines, concept maps, and the Cornell method.
- Apply strategies to make note-taking more effective.
- Organize your notes into effective study guides.
- Use teacher handouts to complement your notes.
- Determine what to do with your notes after the course is complete.
Note-Taking Strategies
Note-Taking Strategies
Note-Taking Strategies
Everybody takes notes, or at least everybody claims to. But if you take a close look, many who are claiming to take notes on their laptops are actually surfing the Web, and paper notebooks are filled with doodles interrupted by a couple of random words with an asterisk next to them reminding you that “This is important!” In college, these approaches will not work. In college, your instructors expect you to make connections between class lectures and reading assignments; they expect you to create an opinion about the material presented; they expect you to make connections between the material and life beyond college. Your notes are your roadmaps for these thoughts. Do you take good notes? After learning to listen, note taking is the most important skill to ensure your success in a class.
Effective note taking is important because it:
- Supports your listening efforts.
- Allows you to test your understanding of the material.
- Helps you remember the material better when you write key ideas down.
- Gives you a sense of what the instructor thinks is important.
- Creates your “ultimate study guide.”
Effective note-taking helps students retain what they learned in class so that they can use the material to study and build their knowledge and tackle more complex concepts later on. In fact, research indicates that there’s a 34 percent chance that students will remember key information if it’s present in their notes but only a 5 percent chance if it’s not. It doesn’t matter whether you prefer to write brief summaries or make visual guides and diagrams in your notes. The important thing is to find a note-taking strategy that works for you.
There are various forms of taking notes, and which one you choose depends on both your personal style and the instructor’s approach to the material. Each can be used in a notebook, index cards, or in a digital form on your laptop. No specific type is good for all students and all situations, so we recommend that you develop your own style, but you should also be ready to modify it to fit the needs of a specific class or instructor. To be effective, all of these methods require you to listen actively and to think; merely jotting down words the instructor is saying will be of little use to you.
The following are a few recommendations to try out:
- Stay organized: Keep your notes and handouts separate for each class. For example, you might have a different notebook and folder for each class or a large notebook with a different tab for each class. This will save you the time of trying to organize and locate your notes when studying for an exam.
- Use your paper: Many students try to fit all of a day’s class notes onto one page and are often left with many extra blank pages in their notebooks. Instead, every time your instructor changes topics, flip to a new page. This allows you to find the material easily and makes your notes much cleaner.
- Use visual cues: Try highlighting, underlining, or drawing arrows or exclamation points next to any main or difficult concepts. This will call attention to these sections and remind you to spend more time reviewing them.
- Group together similar concepts: Grouping or “chunking” material is a good way to make studying and memorization easier. You can try drawing the main concept and connecting it to smaller, related concepts or making an outline of the information. Either one can serve as an effective study guide.
- Make notes legible: Some people have messy handwriting. However, writing as clearly as possible when you take notes will make it easier to review them later. It’s also helpful if you’re asked to share your notes with another student who missed class. If laptop use is permitted during class, you can also type your notes.
The following video addresses other specific strategies for note-taking:
Note-Taking Systems
The following is a chart with a brief explanation of the main note-taking system. They are described in more depth later in the chapter.
| Method | Description | When to Use |
|---|---|---|
| Lists | A sequential listing of ideas as they are presented. Lists may be short phrases or complete paragraphs describing ideas in more detail. | This method is what most students use as a fallback if they haven’t learned other methods. This method typically requires a lot of writing, and you may find that you are not keeping up with the professor. It is not easy for students to prioritize ideas in this method. |
| Outlines | The outline method places the most important ideas along the left margin, which are numbered with Roman numerals. Supporting ideas to these main concepts are indented and are noted with capital letters. Under each of these ideas, further detail can be added, designated with an Arabic number, a lowercase letter, and so forth. | A good method to use when material presented by the instructor is well organized. Easy to use when taking notes on your computer. |
| Concept Maps | When designing a concept map, place a central idea in the center of the page and then add lines and new circles on the page for new ideas. Use arrows and lines to connect the various ideas. | A great method to show relationships among ideas. Also good if the instructor tends to hop from one idea to another and back. |
| Cornell Method | The Cornell method uses a two-column approach. The left column takes up no more than a third of the page and is often referred to as the “cue” or “recall” column. The right column (about two-thirds of the page) is used for taking notes using any of the methods described above or a combination of them. After class or completing the reading, review your notes and write the key ideas and concepts or questions in the left column. You may also include a summary box at the bottom of the page, in which to write a summary of the class or reading in your own words. | The Cornell method can include any of the methods above and provides a useful format for calling out key concepts, prioritizing ideas, and organizing review work. Most colleges recommend using some form of the Cornell method. |
The List Method
The list method is usually not the best choice because it is focused exclusively on capturing as much of what the instructor says as possible, not on processing the information. Most students who have not learned effective study skills use this method because it’s easy to think that this is what note taking is all about. Even if you are skilled in some form of shorthand, you should probably also learn one of the other methods described here, because they are all better at helping you process and remember the material. You may want to take notes in class using the list method, but transcribe your notes to an outline or concept map method after class as a part of your review process. It is always important to review your notes as soon as possible after class and write a summary of the class in your own words.
The Outline Method
The advantage of the outline method is that it allows you to prioritize the material. Key ideas are written to the left of the page, subordinate ideas are then indented, and details of the subordinate ideas can be indented further. To further organize your ideas, you can use the typical outlining numbering scheme (starting with Roman numerals for key ideas, moving to capital letters on the first subordinate level, Arabic numbers for the next level, and lowercase letters following.) At first, you may have trouble identifying when the instructor moves from one idea to another. This takes practice and experience with each instructor, so don’t give up! In the early stages, you should use your syllabus to determine what key ideas the instructor plans to present. Your reading assignments before class can also give you guidance in identifying the key ideas.
If you’re using your laptop computer for taking notes, a basic word processing application (like Microsoft Word or Works) is very effective. Format your document by selecting the outline format from the format bullets menu. Use the increase or decrease indent buttons to navigate the level of importance you want to give each item. The software will take care of the numbering for you!
After class, be sure to review your notes and then summarize the class in one or two short paragraphs using your own words. This summary will significantly affect your recall and will help you prepare for the next class.
The Concept Map Method
This is a very graphic method of note-taking that is especially good at capturing the relationships among ideas. Concept maps harness your visual sense to understand complex material “at a glance.” They also give you the flexibility to move from one idea to another and back easily (so they are helpful if your instructor moves freely through the material).
To develop a concept map, start by using your syllabus to rank the ideas you will listen to by level of detail (from high-level or abstract ideas to detailed facts). Select an overriding idea (high level or abstract) from the instructor’s lecture and place it in a circle in the middle of the page. Then create branches off that circle to record the more detailed information, creating additional limbs as you need them. Arrange the branches with others that interrelate closely. When a new high-level idea is presented, create a new circle with its own branches. Link together circles or concepts that are related. Use arrows and symbols to capture the relationship between the ideas. For example, an arrow may be used to illustrate cause or effect, a double-pointed arrow to illustrate dependence, or a dotted arrow to illustrate impact or effect.
As with all note-taking methods, you should summarize the chart in one or two paragraphs of your own words after class.
The Cornell Method
The Cornell method was developed in the 1950s by Professor Walter Pauk at Cornell University. It is recommended by most colleges because of its usefulness and flexibility. This method is simple to use for capturing notes, is helpful for defining priorities, and is a very helpful study tool.
The Cornell method follows a very specific format that consists of four boxes: a header, two columns, and a footer.
The header is a small box across the top of the page. In it, you write identification information like the course name and the date of the class. Underneath the header are two columns: a narrow one on the left (no more than one-third of the page) and a wide one on the right. The wide column, called the “notes” column, takes up most of the page and is used to capture your notes using any of the methods outlined earlier. The left column, known as the “cue” or “recall” column, is used to jot down main ideas, keywords, questions, clarifications, and other notes. It should be used both during the class and when reviewing your notes after class. Finally, use the box in the footer to write a summary of the class in your own words. This will help you make sense of your notes in the future and is a valuable tool to aid with recall and studying.
Using Index Cards with the Cornell Method
Some students like to use index cards to take notes. They actually lend themselves quite well to the Cornell method. Use the “back” or lined side of the card to write your notes in class. Use one card per key concept. The “front” unlined side of the card replaces the left hand “cue” column. Use it after class to write keywords, comments, or questions. When you study, the cards become flash cards with questions on one side and answers on the other. Write a summary of the class on a separate card and place it on the top of the deck as an introduction to what was covered in the class.
You will have noticed that all methods end with the same step: reviewing your notes as soon as possible after class. Any review of your notes is helpful (reading them, copying them into your computer, or even recasting them using another note-taking method). But THINK! Make your review of notes a thoughtful activity, not a mindless process. When you review your notes, think about questions you still have and determine how you will get the answers. (From the next class? Studying with a friend? Looking up material in your text or on the net?) Examine how the material applies to the course; make connections with notes from other class sessions, with the material in your text, and with concepts covered in class discussions. Finally, it’s fun to think about how the material in your notes applies to real life. Consider this both at the very strategic level (as in “What does this material mean to me in relation to what I want to do with my life?”) as well as at a very mundane level (as in “Is there anything cool here I can work into a conversation with my friends?”).
Instructor Handouts
Some instructors hand out or post their notes or their PowerPoint slides from their lectures. These handouts should never be considered a substitute for taking notes in class. They are a very useful complement and will help you confirm the accuracy of your notes, but they do not involve you in the process of learning as well as your own notes do. After class, review your notes with a highlighter in hand and mark keywords and ideas in your notes. This will help you write the summary of the class in your own words.
Watch this video from College Info Geek on How to Take Notes in Class.
General Tips on Note Taking
Regardless of what note-taking method you choose, there are some note-taking habits you should get into for all circumstances and all courses:
- Be prepared. Make sure you have the tools you need to do the job.
- If you are using a notebook, be sure you have it with you and that you have enough paper.
- Have a separate notebook or designated section for each class, so your notes from math aren’t mixed in with your Art History notes.
- Have a pen and perhaps a pen with different colored ink to use for emphasis.
- If you are taking notes on your laptop, make sure the battery is charged! Select the application that lends itself best to your style of note-taking. Microsoft Word works very well for outline notes, but you might find taking notes in Excel to work best if you are working within the Cornell method. (It’s easier to align your thoughts in the cue or recall column to your notes in the right column. Just be sure you keep one idea per row!) You can often find good note-taking templates online.
- Write on only one side of the paper. This will allow you to integrate your reading notes with your class notes. It will also keep your notes much cleaner.
- Label, number, and date all notes at the top of each page. This will help you keep organized.
- Leave space between topics. This will allow you to go back to a topic if the instructor re-visits it.
- Leaving space between topics keeps your notes much cleaner.
- Avoid writing cramped writing in the margins by turning to a blank page when your instructor switches topics.
- This makes it much easier to locate specific topics when you are reviewing.
- It is a nice visual representation of what topics your instructor spent the most time on.
- When using a laptop, position it such that you can see the instructor and whiteboard right over your screen. This will keep the instructor in your field of vision even if you have to glance at your screen or keyboard from time to time.
- Make sure your focus remains with the instructor and not on your laptop.
- A word of caution about laptops for note taking: use them if you are very adept at keyboarding, but remember that not all note-taking methods work well on laptops because they do not easily allow you to draw diagrams and use special notations (scientific and math formulas, for example).
- Ask your instructor before using a laptop for note-taking. Not all professors allow them.
- Don’t try to capture everything that is said. Listen for the big ideas and write them down.
- Make sure you can recognize the instructor’s emphasis cues and write down all ideas and keywords the instructor emphasizes.
- Listen for clues like “the four causes were…” or “to sum up.…”
- Copy anything the instructor writes on the board. It’s likely to be important.
- Use signals and abbreviations. Which ones you use is up to you, but be consistent so you will know exactly what you mean by “att.” when you review your notes.
- You may find it useful to keep a key to your abbreviations in all your notebooks.
- Use some method for identifying your own thoughts and questions to keep them separate from what the instructor or textbook author is saying. Some students use different color ink; others box or underline their own thoughts. Do whatever works for you.
- Create a symbol to use when you fall behind or get lost in your note-taking.
- Jot down the symbol, leave some space, and focus on what the instructor is covering now.
- Later you can ask a classmate or the professor to help you fill in what you missed, or you can find it in your textbook.
- Review your notes as soon after class as possible (the same day is best). This is the secret to making your notes work!
- Use the recall column to call out the key ideas and organize facts.
- Fill in any gaps in your notes and clean up or redraw hastily drawn diagrams.
- Write a summary of the main ideas of the class in your own words.
- This process is a great aid to recall.
- Be sure to include any conclusions from the lecture or discussion.
- Pretend you are writing the summary for someone else. This will make it clear and detailed.
Organizing Your Notes And Class Materials
The class is over, and you have a beautiful set of notes in your spiral notebook or saved on your laptop. You have written the summary of the class in your own words. Now what?
Start by organizing your notes. We recommend you use a three-ring binder for each of your subjects. Print your notes if you used a computer. If you used note cards, insert them in plastic photo holders for binders. Group all notes from a class or unit together in a section; this includes class notes, reading notes, and instructor handouts. You might also want to copy the instructor’s syllabus for the unit on the first page of the section.
Next, spend some time linking the information across the various notes. Use the recall column in your notes to link to related information in other notes (e.g., “See class notes date/page”).
If you have had a quiz or test on the unit, add it to your binder, too, but be sure to write out the correct answer for any item you missed. Link those corrections to your notes, too.
Use this opportunity to write “notes on your notes.” Review your summary to see if it still is valid in light of your notes on the reading and any handouts you may have added to your notes package.
You don’t need to become a pack rat with your notes. It is fairly safe to toss them after the end of a course except in the following cases:
- If the course you took is a prerequisite for another course, or when the course is part of a standard progression of courses that build upon each other (this is very common in math and science courses), you should keep them as a reference and review for the follow-up course.
- If the course may pertain to your future major, keep your notes. You may not realize it now that they may have future value when you study similar topics or even the same topics in more depth.
- If you are very interested in the course subject and would like to get into the material through a more advanced course, independent study, or even research, keep your notes as a prep tool for further work.
Watch this video from College Info Geek on how to organize your notes and school files.
KEY TAKEAWAYS
- After effective listening, good note taking is the most important skill for academic success.
- Choose among effective note-taking styles for what works best for you and modify it to meet the needs of a specific class or instructor.
- Outlines work well for taking notes on a laptop when the instructor is well organized.
- Concept map notes are good for showing the relationships among ideas.
- The Cornell method is effective for calling out key concepts and organizing notes for review.
- Instructor handouts and PowerPoint presentations help with, but do not replace, personal note taking.
- Keep your notes organized in a way that makes it easy to study for tests and other uses in the future.
LICENSES AND ATTRIBUTIONS
LICENSES AND ATTRIBUTIONS
CC LICENSED CONTENT, ORIGINAL
- Note-Taking Strategies. Authored by: Heather Syrett. Provided by: Austin Community College. License: CC BY-NC-SA-4.0
CC LICENSED CONTENT, SPECIFIC ATTRIBUTION
- Class Attendance in EDUC 1300. Authored by: Jolene Carr. Provided by: Lumen Learning. Located at: https://courses.lumenlearning.com/sanjacinto-learningframework/chapter/class-attendance/. License: CC BY 4.0
- Chapter 4: Listening, Taking Notes, and Remembering in College Success. Authored by: Anonymous. Provided by: University of Minnesota. Located at: http://www.oercommons.org/courses/college-success/view. License: CC BY-NC-SA-4.0
ALL RIGHTS RESERVED CONTENT
- College Info Geek - How To Take Notes in Class. Authored by: Thomas Frank. Located at: https://www.youtube.com/watch?v=AffuwyJZTQQ. License: All Rights Reserved. License Terms: Standard YouTube License
- College Info Geek - How I Organize My Notes. Authored by: Thomas Frank. Located at: https://www.youtube.com/watch?v=yoheFZaYvLU. License: All Rights Reserved. License Terms: Standard YouTube License
|
oercommons
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2025-03-18T00:36:46.574831
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"url": "https://oercommons.org/courseware/lesson/25868/overview",
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https://oercommons.org/courseware/lesson/25869/overview
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Chapter 12: Active Reading Strategies
Overview
Learning Framework: Effective Strategies for College Success
Chapter 12: Active Reading Strategies
Learning Objectives
By the end of this chapter, you will be able to:
- Explain how reading in college is different from reading in high school.
- Identify common types of reading tasks assigned in a college class.
- Describe the purpose and instructor expectations of academic reading.
- Identify effective reading strategies for academic texts using the SQ3R System.
- Explore the Anatomy of a Textbook.
- Develop strategies to help you read effectively.
- Explore strategies for approaching specialized texts, such as math, sciences, and specialized platforms, such as online text.
- Identify vocabulary-building techniques to strengthen your reading comprehension.
Active Reading Strategies
Active Reading Strategies
Highschool Vs. College Reading Expectations
Think back to a high school history or literature class. Those were probably the classes in which you had the most reading. You would be assigned a chapter, or a few pages in a chapter, with the expectation that you would be discussing the reading assignment in class. In class, the teacher would guide you and your classmates through a review of your reading and ask questions to keep the discussion moving. The teacher usually was a key part of how you learned from your reading.
If you have been away from school for some time, it’s likely that your reading has been fairly casual. While time spent with a magazine or newspaper can be important, it’s not the sort of concentrated reading you will do in college. And no one will ask you to write in response to a magazine piece you’ve read or quiz you about a newspaper article.
In college, reading is much different. You will be expected to read much more. For each hour you spend in the classroom, you will be expected to spend two or more additional hours studying between classes, and most of that will be reading. Assignments will be longer (a couple of chapters is common, compared with perhaps only a few pages in high school) and much more difficult. College textbook authors write using many technical terms and include complex ideas. Many college authors include research, and some textbooks are written in a style you may find very dry. You will also have to read from a variety of sources: your textbook, ancillary materials, primary sources, academic journals, periodicals, and online postings. Your assignments in literature courses will be complete books, possibly with convoluted plots and unusual wording or dialects, and they may have so many characters you’ll feel like you need a scorecard to keep them straight.
In college, most instructors do not spend much time reviewing the reading assignment in class. Rather, they expect that you have done the assignment before coming to class and understand the material. The class lecture or discussion is often based on that expectation. Tests, too, are based on that expectation. This is why active reading is so important—it’s up to you to do the reading and comprehend what you read.
Types Of College Reading Materials
As a college student, you will eventually choose a major or focus of study. In your first year or so, though, you’ll probably have to complete “core” or required classes in different subjects. For example, even if you plan to major in English, you may still have to take at least one science, history, and math class. These different academic disciplines (and the instructors who teach them) can vary greatly in terms of the materials that students are assigned to read. Not all college reading is the same. So, what types can you expect to encounter?
Textbooks
Probably the most familiar reading material in college is the textbook. These are academic books, usually focused on one discipline, and their primary purpose is to educate readers on a particular subject—”Principles of Algebra,” for example, or “Introduction to Business.” It’s not uncommon for instructors to use one textbook as the primary text for an entire course. Instructors typically assign chapters as readings and may include any word problems or questions in the textbook, too.
Articles
Instructors may also assign academic articles or news articles. Academic articles are written by people who specialize in a particular field or subject, while news articles may be from recent newspapers and magazines. For example, in a science class, you may be asked to read an academic article on the benefits of rainforest preservation, whereas in a government class, you may be asked to read an article summarizing a recent presidential debate. Instructors may have you read the articles online or they may distribute copies in class or electronically.
The chief difference between news and academic articles is the intended audience of the publication. News articles are mass media: They are written for a broad audience, and they are published in magazines and newspapers that are generally available for purchase at grocery stores or bookstores. They may also be available online. Academic articles, on the other hand, are usually published in scholarly journals with fairly small circulations. While you won’t be able to purchase individual journal issues from Barnes and Noble, public and school libraries do make these journal issues and individual articles available. It’s common to access academic articles through online databases hosted by libraries.
Literature and Nonfiction Books
Instructors use literature and nonfiction books in their classes to teach students about different genres, events, time periods, and perspectives. For example, a history instructor might ask you to read the diary of a girl who lived during the Great Depression so you can learn what life was like back then. In an English class, your instructor might assign a series of short stories written during the 1960s by different American authors, so you can compare styles and thematic concerns.
Literature includes short stories, novels or novellas, graphic novels, drama, and poetry. Nonfiction works include creative nonfiction—narrative stories told from real life—as well as history, biography, and reference materials. Textbooks and scholarly articles are specific types of nonfiction; often their purpose is to instruct, whereas other forms of nonfiction are written to inform, to persuade, or to entertain.
Purpose Of Academic Reading
Casual reading across genres, from books and magazines to newspapers and blogs, is something students should be encouraged to do in their free time because it can be both educational and fun. In college, however, instructors generally expect students to read resources that have particular value in the context of a course. Why is academic reading beneficial?
- Information comes from reputable sources: Web sites and blogs can be a source of insight and information, but not all are useful as academic resources. They may be written by people or companies whose main purpose is to share an opinion or sell you something. Academic sources such as textbooks and scholarly journal articles, on the other hand, are usually written by experts in the field and have to pass stringent peer review requirements in order to get published.
- Learn how to form arguments: In most college classes except for creative writing, when instructors ask you to write a paper, they expect it to be argumentative in style. This means that the goal of the paper is to research a topic and develop an argument about it using evidence and facts to support your position. Since many college reading assignments (especially journal articles) are written in a similar style, you’ll gain experience studying their strategies and learning to emulate them.
- Exposure to different viewpoints: One purpose of assigned academic readings is to give students exposure to different viewpoints and ideas. For example, in an ethics class, you might be asked to read a series of articles written by medical professionals and religious leaders who are pro-life or pro-choice and consider the validity of their arguments. Such experience can help you wrestle with ideas and beliefs in new ways and develop a better understanding of how others’ views differ from your own.
Active Learning When Reading
Many instructors conduct their classes mainly through lectures. The lecture remains the most pervasive teaching format across the field of higher education. One reason is that the lecture is an efficient way for the instructor to control the content, organization, and pace of a presentation, particularly in a large group. However, there are drawbacks to this “information-transfer” approach, where the instructor does all the talking and the students quietly listen: students have a hard time paying attention from start to finish; the mind wanders. Also, current cognitive science research shows that adult learners need an opportunity to practice newfound skills and newly introduced content. Lectures can set the stage for that interaction or practice, but lectures alone don’t foster student mastery. While instructors typically speak 100–200 words per minute, students hear only 50–100 of them. Moreover, studies show that students retain 70 percent of what they hear during the first ten minutes of class and only 20 percent of what they hear during the last ten minutes of class.
Thus it is especially important for students in lecture-based courses to engage in active learning outside of the classroom. But it’s also true for other kinds of college courses—including the ones that have active learning opportunities in class. Why? Because college students spend more time working (and learning) independently and less time in the classroom with the instructor and peers. Also, much of one’s coursework consists of reading and writing assignments. How can these learning activities be active? The following are very effective strategies to help you be more engaged with, and get more out of, the learning you do outside the classroom:
- Write in your books: You can underline and circle key terms, or write questions and comments in the margins of their books. The writing serves as a visual aid for studying and makes it easier for you to remember what you’ve read or what you’d like to discuss in class. If you are borrowing a book or want to keep it unmarked so you can resell it later, try writing keywords and notes on Post-its and sticking them on the relevant pages. (Discussed more in Chapter 12)
- Annotate a text: Annotations typically mean writing a brief summary of a text and recording the works-cited information (title, author, publisher, etc.). This is a great way to “digest” and evaluate the sources you’re collecting for a research paper, but it’s also invaluable for shorter assignments and texts since it requires you to actively think and write about what you read. The activity, below, will give you practice annotating texts. (Discussed more in Chapter 12)
- Create mind maps: Mind maps are effective visuals tools for students, as they highlight the main points of readings or lessons. Think of a mind map as an outline with more graphics than words. For example, if a student were reading an article about America’s First Ladies, they might write, “First Ladies” in a large circle in the center of a piece of paper. Connected to the middle circle would be lines or arrows leading to smaller circles with visual representations of the women discussed in the article. Then, these circles might branch out to even smaller circles containing the attributes of each of these women. (Discussed more in Chapter 11)
The following video discusses the process of creating mind maps further and shows how they can be a helpful strategy for active engagement:
In addition to the strategies described above, the following are additional ways to engage in active reading and learning:
- Work when you are fully awake, and give yourself enough time to read a text more than once.
- Read with a pen or highlighter in hand, and underline or highlight significant ideas as you read.
- Interact with the ideas in the margins (summarize ideas; ask questions; paraphrase difficult sentences; make personal connections; answer questions asked earlier; challenge the author; etc.).
- As you read, keep the following in mind:
- What is the CONTEXT in which this text was written? (This writing contributes to what topic, discussion, or controversy? Context is bigger than this one written text.)
- Who is the intended AUDIENCE? (There’s often more than one intended audience.)
- What is the author’s PURPOSE? To entertain? To explain? To persuade? (There’s usually more than one purpose, and essays almost always have an element of persuasion.)
- How is this writing ORGANIZED? Compare and contrast? Classification? Chronological? Cause and effect? (There’s often more than one organizational form.)
- What is the author’s TONE? (What are the emotions behind the words? Are there places where the tone changes or shifts?)
- What TOOLS does the author use to accomplish her/his purpose? Facts and figures? Direct quotations? Fallacies in logic? Personal experience? Repetition? Sarcasm? Humor? Brevity?
- What is the author’s THESIS—the main argument or idea, condensed into one or two sentences?
- Foster an attitude of intellectual curiosity. You might not love all of the writing you’re asked to read and analyze, but you should have something interesting to say about it, even if that “something” is critical.
Reading Strategies For Academic Texts
Recall from the Active Learning section that effective reading requires more engagement than just reading the words on the page. In order to learn and retain what you read, it’s a good idea to do things like circling keywords, writing notes, and reflecting. Actively reading academic texts can be challenging for students who are used to reading for entertainment alone, but practicing the following steps will get you up to speed.
SQ3R
SQ3R is a reading comprehension method named for its five steps: Survey, Question, Read, Recite, and Review. The method was introduced by Francis Pleasant Robinson, an American education philosopher in his 1946 book Effective Study.
The method offers an efficient and active approach to reading textbook material. It was created for college students but is extremely useful in a variety of situations. Classrooms all over the world have begun using this method to better understand what they’re reading.
- Survey –You can gain insight from an academic text before you even begin the reading assignment. For example, if you are assigned a nonfiction book, read the title, the back of the book, and table of contents. Scanning this information can give you an initial idea of what you’ll be reading and some useful context for thinking about it. You can also start to make connections between the new reading and the knowledge you already have, which is another strategy for retaining information. Survey the document by scanning its contents, gathering the necessary information to focus on topics, and help set study goals.
- Read the title, introduction, summary, or a chapter’s first paragraph(s). This helps to orient yourself to how this chapter is organized and to understand the topic’s key points.
- Go through each boldface heading and subheading. This will help you to create a mental structure for the topic.
- Check all graphics and captions closely. They’re there to emphasize certain points and provide rich additional information.
- Check reading aids and any footnotes. Emphasized text (italics, bold font, etc.) is typically introduced to catch the reader’s attention or to provide clarification.
- Question – During this stage, you should note any questions on the subjects contained in the document. It is helpful to survey the textbook again, this time writing down the questions that you create while scanning each section. You can easily find what questions need to be answered by looking at the Learning Objectives at the beginning of a chapter, the headings, and sub-headings within the chapter and the Chapter Summary or Key Points at the end of a chapter. These questions become study goals and they will become information you’ll actively search later on while going through each section in detail.
- Write your questions down so you can fill in the answers as you read.
- Make sure to answer the questions in your own words, rather than copying directly from the text.
- Read – Read each section thoroughly, keeping your questions in mind. Try to find the answers and identify if you need additional ones. Mind Mapping can probably help to make sense of and correlate all the information.
- Recall/Recite – In the recall (or recite) stage, you should go through what you read and try to answer the questions you noted before. Check-in after every section, chapter, or topic to make sure you understand the material and can explain it, in your own words. It’s worth taking the time to write a short summary, even if your instructor doesn’t require it. The exercise of jotting down a few sentences or a short paragraph capturing the main ideas of the reading is enormously beneficial: it not only helps you understand and absorb what you read but gives you ready study and review materials for exams and other writing assignments. Pretend you are responsible for teaching this section to someone else. Can you do it? It’s at this stage that you consolidate knowledge, so refrain from moving on until you can recall the core information.
- Review – Reviewing all the collected information is the final step of the process. In this stage, you can review the collected information, go through any particular chapter, expand your own notes, or discuss the topics with colleagues and other experts. An excellent way to consolidate information is to present or teach it to someone else. It always helps to revisit what you’ve read for a quick refresher. Before class discussions or tests, it’s a good idea to review your questions, summaries, and any other notes you have taken.
The following video is an overview of the steps of the SQ3R System.
Anatomy of a Textbook
Good textbooks are designed to help you learn, not just to present information. They differ from other types of academic publications intended to present research findings, advance new ideas, or deeply examine a specific subject. Textbooks have many features worth exploring because they can help you understand your reading better and learn more effectively. In your textbooks, look for the elements listed in the table below.
| Textbook Feature | What It Is | Why You Might Find It Helpful |
|---|---|---|
Preface or Introduction | A section at the beginning of a book in which the author or editor outlines its purpose and scope, acknowledges individuals who helped prepare the book, and perhaps outlines the features of the book. | You will gain perspective on the author’s point of view, what the author considers important. If the preface is written with the student in mind, it will also give you guidance on how to “use” the textbook and its features. |
| Foreword | A section at the beginning of the book, often written by an expert in the subject matter (different from the author) endorsing the author’s work and explaining why the work is significant. | A foreword will give you an idea of what makes this book different from others in the field. It may provide hints as to why your instructor selected the book for your course. |
| Author Profile | A short biography of the author illustrating the author’s credibility in the subject matter. | This will help you understand the author’s perspective and what the author considers important. |
Table of Contents | A listing of all the chapters in the book and, in most cases, primary sections within chapters. | The table of contents is an outline of the entire book. It will be very helpful in establishing links among the text, the course objectives, and the syllabus. |
Chapter Preview or Learning Objectives | A section at the beginning of each chapter in which the author outlines what will be covered in the chapter and what the student should expect to know or be able to do at the end of the chapter. | These sections are invaluable for determining what you should pay special attention to. Be sure to compare these outcomes with the objectives stated in the course syllabus. |
| Introduction | The first paragraph(s) of a chapter, which states the chapter’s objectives and key themes. An introduction is also common at the beginning of primary chapter sections. | Introductions to chapters or sections are “must-reads” because they give you a road map to the material you are about to read, pointing you to what is truly important in the chapter or section. |
| Applied Practice Elements | Exercises, activities, or drills are designed to let students apply their knowledge gained from the reading. Some of these features may be presented via Web sites designed to supplement the text. | These features provide you with a great way to confirm your understanding of the material. If you have trouble with them, you should go back and reread the section. They also have the additional benefit of improving your recall of the material. |
| Chapter Summary | A section at the end of a chapter that confirms key ideas presented in the chapter. | It is a good idea to read this section before you read the body of the chapter. It will help you strategize about where you should invest your reading effort. |
| Review Material | A section at the end of the chapter which includes additional applied practice exercises, review questions, and suggestions for further reading. | The review questions will help you confirm your understanding of the material. |
| Endnotes and Bibliographies | Formal citations of sources used to prepare the text. | These will help you infer the author’s biases and are also valuable if doing further research on the subject for a paper. |
Strategies for Textbook Reading
The SQ3R system provides a proven approach to effective learning from texts. Following are some strategies you can use to enhance your reading even further:
- Pace yourself. Figure out how much time you have to complete the assignment. Divide the assignment into smaller blocks rather than trying to read the entire assignment in one sitting. If you have a week to do the assignment, for example, divide the work into five daily blocks, not seven; that way you won’t be behind if something comes up to prevent you from doing your work on a given day. If everything works out on schedule, you’ll end up with an extra day for review.
- Schedule your reading. Set aside blocks of time, preferably at the time of the day when you are most alert, to do your reading assignments. Don’t just leave them for the end of the day after completing written and other assignments.
- Get yourself in the right space. Choose to read in a quiet, well-lit space. Your chair should be comfortable but provide good support. Libraries were designed for reading—they should be your first option! Don’t use your bed for reading textbooks; since the time you were read bedtime stories, you have probably associated reading in bed with preparation for sleeping. The combination of the cozy bed, comforting memories, and dry text are sure to invite some shut-eye!
- Avoid distractions. Active reading takes place in your short-term memory. Every time you move from task to task, you have to “reboot” your short-term memory and you lose the continuity of active reading. Multitasking—listening to music or texting on your cell while you read—will cause you to lose your place and force you to start over again. Every time you lose focus, you cut your effectiveness and increase the amount of time you need to complete the assignment.
- Avoid reading fatigue. Work for about fifty minutes, and then give yourself a break for five to ten minutes. Put down the book, walk around, get a snack, stretch, or do some deep knee bends. Short physical activity will do wonders to help you feel refreshed.
- Read your most difficult assignments early in your reading time, when you are freshest.
- Make your reading interesting. Try connecting the material you are reading with your class lectures or with other chapters. Ask yourself where you disagree with the author. Approach finding answers to your questions like an investigative reporter. Carry on a mental conversation with the author.
- Highlight your reading material. Most readers tend to highlight too much, hiding key ideas in a sea of yellow lines, making it difficult to pick out the main points when it is time to review. When it comes to highlighting, less is more. Think critically before you highlight. Your choices will have a big impact on what you study and learn for the course. Make it your objective to highlight no more than 15-25% of what you read. Use highlighting after you have read a section to note the most important points, key terms, and concepts. You can’t know what the most important thing is unless you’ve read the whole section, so don’t highlight as you read.
- Annotate your reading material. Marking up your book may go against what you were told in high school when the school owned the books and expected to use them year after year. In college, you bought the book. Make it truly yours. Although some students may tell you that you can get more cash by selling a used book that is not marked up, this should not be a concern at this time—that’s not nearly as important as understanding the reading and doing well in the class!
The purpose of marking your textbook is to make it your personal studying assistant with the key ideas called out in the text. Use your pencil also to make annotations in the margin. Use a symbol like an exclamation mark (!) or an asterisk (*) to mark an idea that is particularly important. Use a question mark (?) to indicate something you don’t understand or are unclear about. Box new words, then write a short definition in the margin. Use “TQ” (for “test question”) or some other shorthand or symbol to signal key things that may appear in test or quiz questions. Write personal notes on items where you disagree with the author. Don’t feel you have to use the symbols listed here; create your own if you want, but be consistent. Your notes won’t help you if the first question you later have is “I wonder what I meant by that?”
Watch the following video on annotating texts:
- Get to Know the Conventions. Academic texts, like scientific studies and journal articles, may have sections that are new to you. If you’re not sure what an “abstract” is, research it online or ask your instructor. Understanding the meaning and purpose of such conventions is not only helpful for reading comprehension but for writing, too.
- Look up and Keep Track of Unfamiliar Terms and Phrases. Have a good college dictionary such as Merriam-Webster handy (or find it online) when you read complex academic texts, so you can look up the meaning of unfamiliar words and terms. Many textbooks also contain glossaries or “key terms” sections at the ends of chapters or the end of the book. If you can’t find the words you’re looking for in a standard dictionary, you may need one specially written for a particular discipline. For example, a medical dictionary would be a good resource for a course in anatomy and physiology. If you circle or underline terms and phrases that appear repeatedly, you’ll have a visual reminder to review and learn them. Repetition helps to lock in these new words and their meaning get them into long-term memory, so the more you review them the more you’ll understand and feel comfortable using them.
- Make Flashcards. If you are studying certain words for a test, or you know that certain phrases will be used frequently in a course or field, try making flashcards for review. For each key term, write the word on one side of an index card and the definition on the other. Drill yourself, and then ask your friends to help quiz you. Developing a strong vocabulary is similar to most hobbies and activities. Even experts in a field continue to encounter and adopt new words. The following video discusses more strategies for improving vocabulary.
Dealing With Special Texts
While the active reading process outlined earlier is very useful for most assignments, you should consider some additional strategies for reading assignments in other subjects.
Mathematics Texts
Mathematics presents unique challenges in that they typically contain a great number of formulas, charts, sample problems, and exercises. Follow these guidelines:
- Do not skip over these special elements as you work through the text.
- Read the formulas and make sure you understand the meaning of all the factors.
- Substitute actual numbers for the variables and work through the formula.
- Make formulas real by applying them to real-life situations.
- Do all exercises within the assigned text to make sure you understand the material.
- Since mathematical learning builds upon prior knowledge, do not go on to the next section until you have mastered the material in the current section.
- Seek help from the instructor or teaching assistant during office hours if need be.
Scientific Texts
Science occurs through the experimental process: posing hypotheses, and then using experimental data to prove or disprove them. When reading scientific texts, look for hypotheses and list them in the left column of your notes pages. Then make notes on the proof (or disproof) in the right column. In scientific studies, these are as important as the questions you ask for other texts. Think critically about the hypotheses and the experiments used to prove or disprove them. Think about questions like these:
- Can the experiment or observation be repeated? Would it reach the same results?
- Why did these results occur? What kinds of changes would affect the results?
- How could you change the experiment design or method of observation? How would you measure your results?
- What are the conclusions reached about the results? Could the same results be interpreted in a different way?
Social Sciences Texts
Social sciences texts, such as those for history, economics, and political science classes, often involve interpretation where the authors’ points of view and theories are as important as the facts they present. Put your critical thinking skills into overdrive when you are reading these texts. As you read, ask yourself questions such as the following:
- Why is the author using this argument?
- Is it consistent with what we’re learning in class?
- Do I agree with this argument?
- Would someone with a different point of view dispute this argument?
- What key ideas would be used to support a counterargument?
Record your reflections in the margins and in your notes.
Social science courses often require you to read primary source documents. Primary sources include documents, letters, diaries, newspaper reports, financial reports, lab reports, and records that provide firsthand accounts of the events, practices, or conditions you are studying. Start by understanding the author(s) of the document and his or her agenda. Infer their intended audience. What response did the authors hope to get from their audience? Do you consider this a bias? How does that bias affect your thinking about the subject? Do you recognize personal biases that affect how you might interpret the document?
Foreign Language Texts
Reading texts in a foreign language is particularly challenging, but it also provides you with invaluable practice and many new vocabulary words in your “new” language. It is an effort that really pays off. Start by analyzing a short portion of the text (a sentence or two) to see what you do know. Remember that all languages are built on idioms as much as on individual words. Do any of the phrase structures look familiar? Can you infer the meaning of the sentences? Do they make sense based on the context? If you still can’t make out the meaning, choose one or two words to look up in your dictionary and try again. Look for longer words, which generally are the nouns and verbs that will give you meaning sooner. Don’t rely on a dictionary (or an online translator); a word-for-word translation does not always yield good results. For example, the Spanish phrase “Entre y tome asiento” might correctly be translated (word for word) as “Between and drink a seat,” which means nothing, rather than its actual meaning, “Come in and take a seat.”
Reading in a foreign language is hard and tiring work. Make sure you schedule significantly more time than you would normally allocate for reading in your own language and reward yourself with more frequent breaks. But don’t shy away from doing this work; the best way to learn a new language is practice, practice, practice.
Note to English-language learners: You may feel that every book you are assigned is in a foreign language. If you do struggle with the high reading level required of college students, check for college resources that may be available to ESL (English as a second language) learners. Never feel that those resources are only for weak students. As a second-language learner, you possess a rich linguistic experience that many American-born students should envy. You simply need to account for the difficulties you’ll face and (like anyone learning a new language) practice, practice, practice.
Reading Graphics
You read earlier about noticing graphics in your text as a signal of important ideas. But it is equally important to understand what the graphics intend to convey. Textbooks contain tables, charts, maps, diagrams, illustrations, photographs, and the newest form of graphics, Internet URLs for accessing text and media material. Many students are tempted to skip over the graphic material and focus only on the reading. Don’t! Take the time to read and understand your textbook’s graphics. They will increase your understanding, and because they engage different comprehension processes, they will create different kinds of memory links to help you remember the material.
To get the most out of graphic material, use your critical thinking skills and question why each illustration is present and what it means. Don’t just glance at the graphics; take the time to read the title, caption, and any labeling in the illustration. In a chart, read the data labels to understand what is being shown or compared. Think about projecting the data points beyond the scope of the chart; what would happen next? Why?
The table below shows the most common graphic elements and notes what they do best. This knowledge may help guide your critical analysis of graphic elements.
TABLE Most often used to present raw data. Understand what is being measured. What data points stand out as very high or low?Why? Ask yourself what might cause these measurements to change. | |
BAR CHART Used to compare quantitative data or show changes in data over time. Also can be used to compare a limited number of data series over time. Often an illustration of data that can also be presented in a table. | |
LINE CHART Used to illustrate a trend in a series of data. May be used to compare different series over time. | |
PIE CHART Used to illustrate the distribution or share of elements as a part of a whole. Ask yourself what effect a change in the distribution of factors would have on the whole. | |
MAP Used to illustrate geographic distributions or movement across geographical space. In some cases can be used to show concentrations of populations or resources. When encountering a map, ask yourself if changes or comparisons are being illustrated. Understand how those changes or comparisons relate to the material in the text. | |
PHOTO Used to represent a person, a condition, or an idea discussed in the text. Sometimes photographs serve mainly to emphasize an important person or situation, but photographs can also be used to make a point. Ask yourself if the photograph reveals a biased point of view. | |
ILLUSTRATION Used to illustrate parts of an item. Invest time in these graphics. They are often used as parts of quizzes or exams. Look carefully at the labels. These are vocabulary words you should be able to define. | |
FLOWCHART or DIAGRAM Commonly used to illustrate processes. As you look at diagrams, ask yourself, “What happens first? What needs to happen to move to the next step?” |
Online Texts
Reading online texts presents unique challenges for some students. For one thing, you can’t readily circle or underline key terms or passages on the screen with a pencil. For another, there can be many tempting distractions while reading online – just a quick visit to social media sites or to check your email.
While there’s no substitute for old-fashioned self-discipline, you can take advantage of the following tips to make online reading more efficient and effective:
- Get a browser extension that allows you to highlight and annotate your online text.
- If possible, download the reading as a PDF, Word document, etc., so you can read it offline.
- Get an app or browser extension that disables your social media sites for specified periods of time.
- Adjust your screen to avoid glare and eye strain, and change the text font to be less distracting (for those essays written in Comic Sans).
- Follow the SQ3R system, taking notes and answering questions as you go. Since highlighting and annotating are more difficult with online texts, it is imperative that you take quality notes.
- Look for reputable online sources. Professors tend to assign reading from reputable print and online sources, so you can feel comfortable referencing such sources in class and for writing assignments. If you are looking for online sources independently, however, devote some time and energy to critically evaluating the quality of the source before spending time reading any resources you find there. Find out what you can about the author (if one is listed), the Website, and any affiliated sponsors it may have. Check that the information is current and accurate against similar information on other pages. Depending on what you are researching, sites that end in “.edu” (indicating an “education” site such as a college, university, or other academic institution) tend to be more reliable than “.com” sites. Check with a librarian for help in identifying reputable online sources.
Building Your Vocabulary
Gaining confidence with the unique terminology used in different disciplines can help you be more successful in your courses and in college generally. A good vocabulary is essential for success in any role that involves communication, and just about every role in life requires good communication skills. We include this section on vocabulary in this chapter on reading because of the connections between vocabulary building and reading. Building your vocabulary will make your reading easier, and reading is the best way to build your vocabulary.
Learning new words can be fun and does not need to involve tedious rote memorization of word lists. The first step, as with any other aspect of the learning cycle, is to prepare yourself to learn. Consciously decide that you want to improve your vocabulary; decide you want to be a student of words. Work to become more aware of the words around you: the words you hear, the words you read, the words you say, and those you write.
In addition to the suggestions described earlier, such as looking up unfamiliar words in dictionaries, the following are additional vocabulary-building techniques for you to try:
- Read everything and read often. Reading frequently both in and out of the classroom will help strengthen your vocabulary. Whenever you read a book, magazine, newspaper, blog, or any other resource, keep a running list of words you don’t know. Look up the words as you encounter them and try to incorporate them into your own speaking and writing.
- Be on the lookout for new words. Most will come to you as you read, but they may also appear in an instructor’s lecture, a class discussion, or a casual conversation with a friend. They may pop up in random places like billboards, menus, or even online ads!
- Write down the new words you encounter, along with the sentences in which they were used. Do this in your notes with new words from a class or reading assignment. If a new word does not come from a class, you can write it on just about anything, but make sure you write it. Many word lovers carry a small notepad or a stack of index cards specifically for this purpose.
- Infer the meaning of the word. The context in which the word is used may give you a good clue about its meaning. Do you recognize a common word root in the word? What do you think it means?
- Look up the word in a dictionary. Do this as soon as possible (but only after inferring the meaning). When you are reading, you should have a dictionary at hand for this purpose. In other situations, do this within a couple hours, definitely during the same day. How does the dictionary definition compare with what you inferred? Install a reliable dictionary app on your phone or computer. Look for ones that also pronounce the word.
- Make connections to words you already know. You may be familiar with the “looks like . . . sounds like” saying that applies to words. It means that you can sometimes look at a new word and guess the definition based on similar words whose meaning you know. For example, if you are reading a biology book on the human body and come across the word malignant, you might guess that this word means something negative or broken if you already know the word malfunction, which shares the “mal-” prefix.
- Write the word in a sentence, ideally one that is relevant to you. If the word has more than one definition, write a sentence for each.
- Say the word out loud and then say the definition and the sentence you wrote.
- Use the word. Find an occasion to use the word in speech or writing over the next two days.
- Schedule a weekly review with yourself to go over your new words and their meaning.
KEY TAKEAWAYS
- College reading is very different from high school reading.
- You must take personal responsibility for understanding what you read.
- Expect to spend about two or more hours on homework, most of it reading, for every hour you spend in class.
- Reading is a primary means for absorbing ideas in the learning cycle, but it is also very important for the other three aspects of the learning cycle.
- Understand how your textbook is put together and what features might help you with your reading.
- Plan your reading by scanning the reading assignment first, then create questions based on the section titles. Use the SQ3R system to help you focus and prioritize your reading.
- Don’t try to highlight your text as you read the first time through. At that point, it is hard to tell what is really important. Aim to highlight 15-25% of the text.
- End your reading time by reviewing your notes.
- Do all the exercises in math textbooks; apply the formulas to real-world situations.
- Each type of graphic material has its own strength; those strengths are usually clues about what the author wants to emphasize by using the graphic.
- Look for statements of hypotheses and experimental design when reading science texts.
- History, economics, and political science texts are heavily influenced by interpretation. Think critically about what you are reading.
- Working with foreign language texts requires more time and more frequent breaks. Don’t rely on word-for-word translations.
- The best way to build your vocabulary is to read, and a stronger vocabulary makes it easier and more fun to read.
- Look for new words everywhere, not just in class readings.
- Look up new words in the dictionary, write your own sentence using the new word. Say the word and definition out loud. Use the new word as soon as possible.
LICENSES AND ATTRIBUTIONS
LICENSES AND ATTRIBUTIONS
CC LICENSED CONTENT, ORIGINAL
- Active Reading Strategies. Authored by: Heather Syrett. Provided by: Austin Community College. License: CC BY-NC-SA-4.0
CC LICENSED CONTENT, SPECIFIC ATTRIBUTION
- Active Learning in EDUC 1300. Authored by: Jolene Carr. Provided by: Lumen Learning. Located at: https://courses.lumenlearning.com/sanjacinto-learningframework/chapter/active-engagement/. License: CC BY 4.0
- Chapter 5: Reading to Learn in College Success. Authored by: Anonymous. Provided by: University of Minnesota. Located at: http://www.oercommons.org/courses/college-success/view. License: CC BY-NC-SA-4.0
- Reading Strategies in EDUC 1300. Authored by: Jolene Carr. Provided by: Lumen Learning. Located at: https://courses.lumenlearning.com/sanjacinto-learningframework/chapter/reading-strategies/. License: CC BY 4.0
- SQ3R. Provided by: Thousand Insights. Located at: https://thousandinsights.wordpress.com/2009/01/25/sq3r/. License: CC BY-SA 4.0
- SQ3R. Provided by: Wikipedia. Located at: https://en.wikipedia.org/wiki/SQ3R. License: CC BY-SA 3.0
- Understanding SQ3R Presentation. Authored by: Student Success Center OCtech. Located at: https://youtu.be/d0uVLSacIzA. License: CC BY 3.0
ALL RIGHTS RESERVED CONTENT
- How to Use a Mindmap. Provided by: Two-Point-Four. Located at: https://youtu.be/L0XzZCd2tPE. License: All Rights Reserved. License Terms: Standard YouTube License
- Annotate It: Provided by: Janene Davison. Located at: https://youtu.be/GkZtC3o0AjE. License: All Rights Reserved. License Terms: Standard YouTube License
|
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2025-03-18T00:36:46.628810
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https://oercommons.org/courseware/lesson/25870/overview
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Chapter 13: Test Taking Strategies
Overview
Learning Framework: Effective Strategies for College Success
Chapter 13: Test Taking Strategies
Learning Objectives
By the end of this chapter, you will be able to:
- Understand the role of tests in the Learning Cycle.
- Define test anxiety, identify sources of test anxiety and techniques for preventing and controlling it.
- Identify long-term study strategies.
- Become familiar with different types of tests and test formats.
- Implement specific test strategies for before, during and after a test.
- Identify strategies for answering typical kinds of test questions (multiple choice, true/false, matching, short answer and essay).
- Understand the importance of academic integrity and the consequences of dishonesty.
- Effectively evaluate your test results and correct your mistakes.
- Use your test results as a study guide.
Test Taking Strategies
Test Taking Strategies
Testing As Part Of The Learning Cycle
Testing is a part of life. Have you ever participated in an athletic event? Completed a crossword puzzle? Acted in a play? Cooked dinner? Answered a child’s question? Prepared a cost estimate? All of these common life situations are forms of tests because they measure how much we know about a specific subject at a single point in time. They alone are not good measurements about how smart or gifted you are—they show only how much you know or can do at that moment. We can learn from how we have performed, and we can think about how to apply what we have learned to do even better next time. We can have fun measuring our progress.
Many of our daily activities are measurements of progress toward mastery of skills or knowledge. We welcome these opportunities for both work and fun. But when these opportunities are part of our academic life, we often dread them and rarely feel any sense of fun. In reality, however, academic tests are similar to real-life tests in the following ways:
- They help us measure our progress toward mastery of a particular skill.
- They are not a representation of how smart, talented, or skilled we are but rather are a measurement only of what we know about a specific subject at a specific point in time.
- They are extraordinary learning opportunities.
Academic tests in college are different from those you took in high school. College instructors expect to see much more of you in an exam: your thoughts, your interpretations, your thinking process, your conclusions. High school teachers usually look for your ability to repeat precisely what you read in your text or heard in your class. Success on high school tests relies much more on memorization than on understanding the material. This is why you need to modify your study habits and your strategies for taking exams in college.
Take a look at the learning cycle “The Learning Cycle: Review and Apply”. In this chapter, we cover reviewing and applying the material you learn; preparing for and taking exams is the practical application of this phase.
Let’s start at the top of the cycle. You have invested your time in preparing for class, you have been an active listener in class, and you have asked questions and taken notes. You have summarized what you learned and have looked for opportunities to apply the material. You have completed your reading assignments and compared your reading notes with your class notes. And now you hear your instructor say, “Remember the exam next week.”
A sense of dread takes over. You worry about the exam and what might be on it. You stay up for a couple of nights trying to work through the volumes of material the course has covered. Learning or remembering it all seems hopeless. You find yourself staring at the same paragraph in your text over and over again, but you just don’t seem to get it. As the exam looms closer, you feel your understanding of the material is slipping away. You show up for the exam and the first questions look familiar, but then you draw a blank—you’re suffering from test anxiety.
Test Anxiety And How To Control It
For many test-takers, preparing for a test and taking a test can easily cause worry and anxiety. In fact, most students report that they are more stressed by tests and schoolwork than by anything else in their lives, according to the American Test Anxiety Association. Most of us have experienced this. It is normal to feel stress before an exam, and in fact, that may be a good thing. Stress motivates you to study and review, generates adrenaline to help sharpen your reflexes and focus while taking the exam, and may even help you remember some of the material you need. But suffering too many stress symptoms or suffering any of them severely will impede your ability to show what you have learned. Test anxiety is a psychological condition in which a person feels distressed before, during, or after a test or exam to the point where stress causes poor performance. Anxiety during a test interferes with your ability to recall knowledge from memory as well as your ability to use higher-level thinking skills effectively.
- Roughly 16–20 percent of students have high test anxiety.
- Another 18 percent have moderately high test anxiety.
- Test anxiety is the most common academic impairment in grade school, high school, and college.
Below are some effects of moderate anxiety:
- Being distracted during a test
- Having difficulty comprehending relatively simple instructions
- Having trouble organizing or recalling relevant information
- Crying
- Illness
- Eating disturbance
- High blood pressure
- Acting out
- Toileting accidents
- Sleep disturbance
- Cheating
- Negative attitudes towards self, school, subjects
Below are some effects of extreme test anxiety:
- Overanxious disorder
- Social phobia
- Suicide
Poor test performance is also a significant outcome of test anxiety. Test-anxious students tend to have lower study skills and lower test-taking skills, but research also suggests that high levels of emotional distress correlate with reduced academic performance overall. Highly test-anxious students score about 12 percentile points below their low-anxiety peers. Students with test anxiety also have higher overall dropout rates. And test anxiety can negatively affect a student’s social, emotional, and behavioral development, as well as feelings about themselves and school.
Why does test anxiety occur? Inferior performance arises not because of intellectual problems or poor academic preparation. It occurs because testing situations create a sense of threat for those who experience test anxiety. The sense of threat then disrupts the learner’s attention and memory.
Other factors can influence test anxiety, too. Students with disabilities and students in gifted education classes tend to experience high rates of test anxiety.
If you experience test anxiety, have hope! Experiencing test anxiety doesn’t mean that there’s something wrong with you or that you aren’t capable of performing well in college. The trick is to keep stress and anxiety at a level where it can help you do your best rather than get in your way.
ACTIVITY: TESTING YOUR TEST ANXIETY
| T | F | I have a hard time starting to study for a test. |
| T | F | When studying for an exam, I feel desperate or lost. |
| T | F | When studying for an exam, I often feel bored and tired. |
| T | F | I don’t sleep well the night before an exam. |
| T | F | My appetite changes the day of the exam. (I’m not hungry and skip meals or I overeat—especially high-sugar items like candy or ice cream.) |
| T | F | When taking an exam, I am often confused or suffer mental blocks. |
| T | F | When taking an exam, I feel panicky and my palms get sweaty. |
| T | F | I’m usually in a bad mood after taking an exam. |
| T | F | I usually score lower on exams than on papers, assignments, and projects. |
| T | F | After an exam, I can remember things I couldn’t recall during the exam. |
Strategies for Preventing and Controlling Test Anxiety
There are steps you should take if you find that stress is getting in your way:
- Be prepared. A primary cause of test anxiety is not knowing the material. If you take good class and reading notes and review them regularly, this stressor should be greatly reduced if not eliminated. You should be confident going into your exam (but not overconfident).
- Practice! One of the best ways to prepare for an exam is to take practice tests. To overcome test-taking anxiety, practice test-taking in a test-like environment, like a study room in the library. Practice staying calm, relaxed, and confident. If you find yourself feeling overly anxious, stop and start again.
- Avoid negative thoughts. Your own negative thoughts—“I’ll never pass this exam” or “I can’t figure this out, I must be really stupid!”—may move you into a spiraling stress cycle that in itself causes enough anxiety to block your best efforts. When you feel you are brewing a storm of negative thoughts, stop what you are doing and clear your mind. Don’t practice having anxiety! Allow yourself to daydream a little; visualize yourself in pleasant surroundings with good friends. Don’t go back to work until you feel the tension release. Sometimes it helps to take a deep breath and shout “STOP!” and then proceed with clearing your mind. Once your mind is clear, repeat a reasonable affirmation to yourself—“I know this stuff”—before continuing your work.
- Visualize success. Picture what it will feel like to get that A. Translate that vision into specific, reasonable goals and work toward each individual goal. Take one step at a time and reward yourself for each goal you complete.
- It’s all about you! Don’t waste your time comparing yourself to other students in the class, especially during the exam. Keep focused on your own work and your own plan. Exams are not a race, so it doesn’t matter who turns in their paper first. Certainly, you have no idea how they did on their exam, so a thought like “Kristen is already done, she must have aced it, I wish I had her skills” is counterproductive and will only cause additional anxiety.
- Have a plan and follow it. As soon as you know that an exam is coming, you can develop a plan for studying. As soon as you get your exam paper, you should develop a plan for the exam itself. We’ll discuss this later in this chapter. Don’t wait to cram for an exam at the last minute; the pressure you put on yourself and the late-night will cause more anxiety, and you won’t learn or retain much.
- Make sure you eat well and get a good night’s sleep before the exam. Hunger, poor eating habits, energy drinks, and lack of sleep all contribute to test anxiety.
- Chill! You perform best when you are relaxed, so learn some relaxation exercises you can use during an exam. Before you begin your work, take a moment to listen to your body. Which muscles are tense? Move them slowly to relax them. Tense them and relax them. Exhale, then continue to exhale for a few more seconds until you feel that your lungs are empty. Inhale slowly through your nose and feel your ribcage expand as you do. This will help oxygenate your blood and reenergize your mind.
- Come early and prepared. Come to the exam with everything you need like your pencils, erasers, calculator, etc. Arrive to class early so you aren’t worried about time. Try to avoid the pre-exam chatter of your classmates, as this may contribute to your anxiety. Instead, pick your favorite chair and focus on relaxing.
- Put it in perspective. Take a minute to think about the three most important things in your life. They may be your family, your health, your friendships. Will you lose any of these important things as a result of the exam? An exam is not life or death and it needs to be put in perspective.
Health and wellness cannot be overstated as factors in test anxiety. Studying and preparing for exams can be easier when you take care of your mental and physical health. The following are a few tips for better health, better focus, and better grades:
- Try mini-meditation to reduce stress and improve focus. Breathe in deeply, count to five, and exhale slowly. Watch your lower abdomen expand and deflate. Repeat five times.
- Get sleep! Although some students may stay up until 4 a.m. studying, it’s not a healthy habit and is usually counter-productive. Your mind is more efficient when you get enough quality sleep, so make sure to schedule enough time for rest. If you practice a good study schedule, there is no need for all-night cramming. Stick to your study plan, review for about an hour, and get a good night’s sleep.
- Eat well. Have a healthy meal before your exam. Avoid energy drinks that will give you a temporary energy spurt, followed by a crash. Stay hydrated.
- Don’t try to be perfect. You’ll alleviate a lot of anxiety by learning that just “doing your best” is something to be proud of—it doesn’t have to be perfect.
- Reach out for help. If you feel you need assistance with your mental or physical health, talk to a counselor or visit a doctor.
Complete Section #2 Below: ACTIVITY: CONTROLLING NEGATIVE TALK
Watch this video from College Info Geek on Test Anxiety: How to Take On Your Exams Without Stress
Studying To Learn (Not Cram!)
You have truly learned material when you can readily recall it and actually use it, on tests or in real-life situations. Effective studying is your most important tool to combat test anxiety, but more importantly, effective studying helps you truly master the material and be able to apply it as you need to, in school and beyond.
In previous chapters, we set the foundation for effective learning. You learned how to listen and how to take notes. You learned how to read actively and how to capture information from written sources. Now we’ll follow up on some of those key ideas and take the learning cycle to its conclusion and a new beginning.
The reviewing and applying stage of the learning cycle involves studying and using the material you have been exposed to in your course. Recall that we emphasized the importance of reviewing your notes soon after the class or assignment. This review is largely what studying is all about.
Effective studying is an ongoing process of reviewing course material. The first and most important thing you should know is that studying is not something you do a few days before an exam. To be effective, studying is something you do as part of an ongoing learning process, throughout the duration of the term.
Studying Every Day
Studying begins after each class or assignment when you review your notes. Each study session should involve three steps:
- Gather your learning materials. Take time to merge your class notes with your reading notes. How do they complement each other? Stop and think. What do the notes tell you about your material? What aspects of the material are you unsure about? Do you need to reread a part of your text? Write down any questions you have for your instructor and pay a visit during office hours. It is better to clear up any misconceptions and get your questions answered soon after you are exposed to the material, rather than to wait, for two reasons: (1) the question or doubt is fresh in your mind and you won’t forget about it and (2) instructors usually build their lessons on material already presented. If you don’t take these steps now, you are setting yourself up for problems later in the course.
- Apply or visualize. What does this material mean to you? How will you use this new knowledge? Try to find a way to apply it in your own life or thoughts. If you can’t use the knowledge right away, visualize yourself using the knowledge to solve a problem or visualize yourself teaching the material to other students.
- Cement your knowledge. If you use the two-column note-taking method, cover up the right side of your notes with a piece of paper, leaving the questions in the left column exposed. Test yourself by trying to answer your questions without referring to your notes. How did you do? If you are unsure about anything, look up the answer and write it down right away. Don’t let a wrong answer be the last thing you wrote on a subject because you will most likely continue to remember the wrong answer.
Studying in Course Units
At the end of each unit, or at least every two weeks or so, use your notes and textbook to write an outline or summary of the material in your own words. (Remember the paragraphs you wrote to summarize each class or reading? They’ll be very helpful to you here.) After you have written the summary or outline, go back and reread your outline from the prior unit followed by the one you just wrote. Does the new one build on the earlier one? Do you feel confident you understand the material?
Studying before the Exam
At least a week before a major exam, ask yourself these questions: What has the instructor said about what is included in the exam? Has the instructor said anything about what types of questions will be included? If you were the instructor, what questions would you ask on an exam? Challenge yourself to come up with some really tough open-ended questions. Think about how you might answer them. Be sure to go to any review sessions the instructor or your section leader holds.
Now go back and review your outlines. Do they cover what the instructor has suggested might be on the exam? After reviewing your outlines, reread the sections of your notes that are most closely associated with expected exam questions. Pay special attention to those items the instructor emphasized during class. Read key points aloud and write them down on index cards. Make flashcards to review in downtimes, such as when you’re waiting for a bus or for a class to start.
More Tips for Success
- Schedule a consistent study and review time for each course at least once a week, in addition to your class and assignment time. Keep to that schedule as rigorously as you do your class schedule. Use your study time to go through the steps outlined earlier; this is not meant to be a substitute for your assignment time.
- Get yourself in the right space. Choose to study in a quiet, well-lit space. Your chair should be comfortable but provide good support. Remember that libraries were designed for reading and should be your first option.
- Minimize distractions. Turn off your cell phone and get away from Facebook, television, other nearby activities, and chatty friends or roommates. All of these can cut into the effectiveness of your study efforts. Multitasking and studying don’t mix.
- If you will be studying for a long time, take short breaks at least once an hour. Get up, stretch, breathe deeply, and then get back to work. (If you keep up with your daily assignments and schedule weekly review sessions for yourself—and keep them—there should be almost no need for long study sessions.)
Studying in Groups
Study groups are a great idea, as long as they are thoughtfully managed. A study group can give you new perspectives on course material and help you fill in gaps in your notes. Discussing course content will sharpen your critical thinking related to the subject, and being part of a group to which you are accountable will help you study consistently. In a study group, you will end up “teaching” each other the material, which is the strongest way to retain new material. But remember, being in a group working together doesn’t mean there will be less work for you as an individual; your work will just be much more effective.
Here are some tips for creating and managing effective study groups:
- Think small. Limit your study group to no more than three or four people. A larger group would limit each student’s participation and make scheduling of regular study sessions a real problem.
- Go for quality. Look for students who are doing well in the course, who ask questions, and who participate in class discussions. Don’t make friendship the primary consideration for who should be in your group. Meet up with your friends instead during “social time”—study time is all about learning.
- Look for complementary skills and learning styles. Complementary skills make for a good study group because your weaknesses will be countered by another student’s strengths. When a subject requires a combination of various skills, strengths in each of those skills are helpful (e.g., a group with one student who is really good at physics and another at math would be perfect for an engineering course). Finally, a variety of learning styles is helpful because each of you picks up differing signals and emphases from the instructor that you can share with each other, so you will not likely miss important points.
- Meet regularly. When you first set up a study group, agree to a regular meeting schedule and stick to it. Moving study session times around can result in nonparticipation, lack of preparation, and eventually the collapse of the study group. Equally important is keeping your sessions to the allotted times. If you waste time and regularly meet much longer than you agreed to, participants will not feel they are getting study value for their time invested.
- Define an agenda and objectives. Give your study sessions focus so that you don’t get sidetracked. Based on requests and comments from the group, the moderator should develop the agenda and start each session by summarizing what the group expects to cover and then keep the group to task.
- Include some of the following items on your agenda:
- Review and discuss class and assignment notes since your last meeting.
- Discuss assigned readings.
- Quiz each other on class material.
- “Reteach” aspects of the material team participants are unsure of.
- Brainstorm possible test questions and responses.
- Review quiz and test results and correct misunderstandings.
- Critique each other’s ideas for paper themes and approaches.
- Define questions to ask the instructor.
- Assign follow-up work. If there is any work that needs to be done between meetings, make sure that all team members know specifically what is expected of them and agree to do the work.
- Rotate the role of moderator or discussion leader. This helps ensure “ownership” of the group is spread equally across all members and ensures active participation and careful preparation.
Types of Tests
All tests are designed to determine how much you know about a particular subject at a particular point in time. There are many ways to understand how tests and exams fit into academia and college culture. One way is to ask what purpose the tests (also called assessments) serve. For example, what is your professor trying to achieve if they give you a survey-type test on the first day of class? How might the purpose of that test differ from that of, say, a practice quiz given before a midterm? And what is the purpose of a midterm?
Obviously, each survey, quiz, practice test, midterm, and final exam can serve different purposes. Depending upon the purpose, the assessment will fall into one of the following three categories:
- Pre-assessment
- Formative assessment
- Summative assessment
Pre-assessments: Tests in this category are used to measure the beliefs, assumptions, knowledge, and skills that you have when you begin a class or before you begin working on a new topic. With pre-assessments, your professor gathers baseline data to use at a later time to evaluate change—that is, by comparing former knowledge or skills against what you learn in class.
One approach to pre-assessment is for a professor to ask students at the start of the term to describe a term or concept that’s foundational to the course. Then, later in the course, the professor revisits that data to determine how the instruction changed your understanding of the same concept. Comparing what you know or believe before and after a course or lesson is a productive way to gauge how successful your learning was and how successful the teaching was.
Formative assessments: Tests in this category are typically quizzes, unit tests, pop quizzes, and review quizzes from a textbook or its Web site. Their main objective is to make sure you know the fundamental material before moving on to more challenging topics. Because these quizzes usually don’t count much toward your final grade, many students think they are not very important. In fact, these quizzes are very important, particularly to you; they can help you to identify what you know and what you still need to learn to be successful in the course and in applying the material. A poor result on a quiz may not negatively affect your final grade much, but learning from its results and correcting your mistakes will affect your final grade, on the positive side, when you take midterms and finals!
Summative assessments: Tests in this category are the assessments that students are most familiar with: midterms and finals. They are used by the instructor to determine if you are mastering a large portion of the material, and as such, they usually carry a heavyweight toward your final grade for the course. Because of this, summative assessments can be stressful, but they can also be an effective measurement tool.
Test Formats
Tests vary in style, rigor, and requirements. For example, in a closed book test, a test taker is typically required to rely upon memory to respond to specific items. In an open-book test, though, a test taker may use one or more supplementary resources such as a reference book or notes. Open-book testing may be used for subjects in which many technical terms or formulas are required to effectively answer questions, like in chemistry or physics.
In addition, tests may be administered formally or informally. In an informal test, you might simply respond in a class to questions posed by the instructor. In a formal test, you are usually expected to work alone, and the stakes are higher.
Below is a sampling of common test formats you may encounter. If you know what kind of test you’ll be taking, you can tailor your study approach to the format.
Common Test Types
There are three common test types: written tests, oral tests, and electronic tests. Let’s look at the kinds of things you’ll be expected to complete in each test type.
Written tests can be open book, closed book, or anywhere in between. Students are required to give written answers (as the name of this test type implies).
- Paper tests are still the most common type of test, requiring students to write answers on the test pages or in a separate test booklet or answer sheet. They are typically used for in-class tests. Neatness and good grammar count, even if it’s not an English exam. Remember that the instructor will be reading dozens of test papers and will not likely spend much time trying to figure out your hieroglyphics, arrows, and cross-outs.
- Open-book tests allow the student to consult their notes, textbook, or both while taking the exam. Instructors often give this type of test when they are more interested in seeing your thoughts and critical thinking than your memory power. Be prepared to expose and defend your own viewpoints. When preparing, know where key material is present in your book and notes; create an index for your notes and use sticky notes to flag key pages of your textbook before the exam. Be careful when copying information or formulas to your test answers, because nothing looks worse in an open-book exam than misusing the material at your disposal.
- Take-home tests are like open-book tests except you have the luxury of time on your side. Make sure you submit the exam on time. Know what the instructor’s expectations are about the content of your answers. The instructor will likely expect more detail and complete work because you are not under a strict time limit and because you have access to reference materials. Be clear about when the test is due. (Some instructors will ask you to e-mail your exam to them by a specific time.) Also, find out if the instructor allows or expects you to collaborate with classmates. Be sure to type your exam and don’t forget to spell-check!
Below you’ll find a table of the most common question types in written tests:
| Question Type | Description |
|---|---|
| Multiple choice (objective) | You are presented with a question and a set of answers for each question, and you must choose which answer or group of answers is correct. Multiple-choice questions usually require less time for test-takers to answer than other question types, and they are easy to score and grade. They also allow for a wide range of difficulty. |
| True False (objective) | You are presented with a statement, and you must determine whether it is true or false. True/false questions are generally not predominant on tests because instructors know that, statistically, random guesswork can yield a good score. But when used sparingly, true/false questions can be effective. |
| Matching (objective) | You are presented with a set of specific terms or ideas and a set of definitions or identifying characteristics. You must match each term with its correct definition or characteristics. |
| Fill-in-the-blank (objective) | You are presented with identifying characteristics, and you must recall and supply the correct associated term or idea. There are two types of fill-in-the-blank tests: 1) The easier version provides a word bank of possible words that will fill in the blanks. 2) The more difficult version has no word bank to choose from. Fill-in-the-blank tests with no word bank can be anxiety-producing. |
| Essay (subjective) | You are presented with a question or concept that you must explain in depth. Essay questions emphasize themes and broad ideas. Essay questions allow students to demonstrate critical thinking, creative thinking, and writing skills. |
Oral Tests or Presentations are a discussion type of test. They are also subjective: there isn’t just one correct answer to the test questions. The oral test is practiced in many schools and disciplines in which an examiner verbally poses questions to the student. The student must answer the question in such a way as to demonstrate sufficient knowledge of the subject. Usually, study guides or a syllabus are made available so that the students may prepare for the exam by reviewing practice questions and topics likely to be on the exam. The instructor can (and likely will) probe you on certain points, question your assumptions, or ask you to defend your point of view. Make sure you practice your presentation many times with and without an audience (your study group is good for this). Have a clear and concise point of view and keep to the allotted time. (You don’t want to miss delivering a killer close if your instructor cuts you off because you weren’t aware of the time!)
Electronic Tests or Online Tests are most commonly used for formative assessments, although they are starting to find their way into high-stakes exams, particularly in large lecture classes that fulfill a graduation requirement (like introductory psychology or history survey courses). The main advantage of online tests is that they can be computer-graded, providing fast feedback to the student (with formative tests) and allowing the instructor to grade hundreds of exams easily (with summative assessments). Since these tests are computer-graded, be aware that the instructor’s judgment is not involved in the grading. Your answers will be either right or wrong; there is no room for partially correct responses. With online tests, be sure you understand the testing software. Are there practice questions? If so, make sure you use them. Find out if you will be allowed to move freely between test sections to go back and check your work or to complete questions you might have skipped. Some testing software does not allow you to return to sections once they are “submitted.” Unless your exam needs to be taken at a specific time, don’t wait until the last minute to take the test. Should you have technical problems, you want to have time to resolve the issues. To avoid any conflicts with the testing software, close all other software applications before beginning the testing software. Electronic tests in the classroom are becoming more common as colleges install “smart classrooms” with technology such as wireless “clicker” technology that instructors may use to get a quick read of students’ understanding of a lecture. This testing method allows for only true-or-false and multiple-choice questions, so it is rarely used for summative assessments. When taking this kind of quick quiz, take notes on questions you miss so that you can focus on them when you do your own review.
Complete Section #3 Below: ACTIVITY: Test your Test Knowledge Crossword
Test-Taking Strategies
You have used all the study skills you learned in this course. You listen in class, take clear notes, read your textbook, compare your textbook and classroom notes, and review regularly. You have brought your test anxiety into control. Your upcoming test is now an opportunity for you to show what you have learned What else can you do to ensure success on a test?
Before the Test
- Use your study skills as you go.
- Research the test’s structure and scope.
- What is the test format?
- What chapters does it cover?
- How many questions are on it?
- What is the time limit?
- What materials are allowed?
- Is a study guide provided?
- Are practice tests available?
- What percentage of your final grade is the test?
- Collect and organize the resources you need to study.
- Classroom notes
- Textbook notes
- Master set of notes
- Study guides
- Practice tests
- Handouts
- Slides or presentations
- Study over several sessions
- Make a study plan for several days before the exam
- Have a clear goal for each study session
- Study in 45-60 minutes chunks and then take a break
- Make study aids
- Create flashcards
- Make a study guide
- Make a practice test
- Predict test questions
- Practice answering essay questions
- Get a good night’s sleep.
- Have a healthy breakfast
- Be sure you have all the necessary materials
- Pencils
- Erasers
- Pens
- Answer sheets/test booklets
- Calculators
- Arrive early and relax
During the Test
Scan the test first to see what it covers
- This often reduces anxiety and boosts confidence
- Identify the point value of each test section
- Write down what you know
- If you are trying to remember things like formulas, definitions, lists, etc., flip your test over and write down everything you are trying to remember. This will clear your brain, allowing you to focus 100% on the exam, rather than using part of your attention to remember specific information.
- Plan your time
- Now that you have scanned your test, how much time should you spend on each section?
- This can often reduce anxiety and keeps you from unnecessarily rushing
- Check on the time often to make sure you are on track. Slow down or speed up as necessary.
- Work on high point-value questions first
- Read the instructions carefully
- Don’t assume you know what the instructions are. Be sure!
- Answer the easy questions first and skip the harder ones.
- Go through the test and answer all of the ones you know first.
- Skip the ones you are unsure of. There are often clues later in the exam or another question that will spark your memory.
- Stay positive by not getting down about a question you don’t know. Skip it and return to it later.
- Read each question carefully!
- Answer everything. Don’t leave anything blank, even if you have to guess.
- Don’t rush! Use all the time available. There are no points for finishing first.
- Check your work for accuracy.
- Check to make sure you have answered all parts of a question.
- Check your answer sheet every 10 questions to make sure you aren’t mismarking.
- Only change an answer if you are SURE you made a mistake. Your first instinct is most likely correct.
After the Test
- Reward yourself for a job well done!
- Stick with your study schedule
- We have a tendency to take a break from our studies after an exam, often resulting in being behind the next week.
- Use the test as a learning tool
- What did you well?
- What can you do differently for the next test?
- What did you learn about this instructor’s testing style and how will that impact your study plan?
- What patterns do you notice about your test-taking?
- Did you lose points for not answering all parts of the essay?
- Did you not read questions or instructions carefully?
- Do you need to focus more on dates, vocabulary, formulas, etc.?
- Review your test carefully and fix all errors so you don’t make the same mistakes again.
- Apply the feedback to the next test
Strategies For Specific Question Types
You can gain even more confidence in your test-taking abilities by understanding the different kinds of questions an instructor may ask and apply the following proven strategies for answering them. Most instructors will likely use various conventional types of questions. Here are some tips for handling the most common types.
Multiple-Choice Questions
- Read the instructions carefully to determine if there may be more than one right answer.
- If there are multiple right answers, does the instructor expect you to choose just one, or do you need to mark all correct options?
- Read each question carefully and try to answer it in your head before reading the answer options.
- Then consider all the options.
- Eliminate first the options that are clearly incorrect.
- Compare the remaining answers with your own answer before choosing one and marking your paper.
- If you are stuck, treat the remaining answers as True/Fale statements. This often helps pick the correct answer.
- Look for clue words that hint that certain option answers might be correct or incorrect.
- Absolute words like “never,” “always,” “every,” or “none” are rarely found in a correct option.
- Less absolute words like “usually,” “often,” or “rarely” are regularly found in correct options.
- Be on the lookout for the word “not” in the stem phrase and in the answer choice options; it is an easy word to miss if you are reading too quickly, but it completely changes the meaning of the possible statements.
- Skip difficult questions.
- There are often clues in later questions. Or, you may recall information that you had forgotten
- Go back and answer all the questions.
- Do not leave any questions blank, unless there is a penalty for wrong answers (this is often on standardized tests like the SAT and LSAT but rarely on college tests.)
True-or-False Questions
- Most of the tips for multiple-choice questions apply here as well.
- Be particularly aware of the words “never,” “always,” “every,” “none,” and “not” because they can determine the correct answer.
- Answer the questions that are obvious to you first. Then go back to statements that require more thought.
- If the question is stated in the positive, restate it to yourself in the negative by adding the word “not” or “never.” Does the new statement sound truer or more false?
- If you still are unsure whether a statement is true or false and must guess, choose “true” because most tests include more true statements than false (but don’t guess if a wrong answer penalizes you more than one left blank).
Matching Columns
- Start by looking at the two columns to be matched. Is there an equal number of items in both columns? If they are not equal, do you have to match some items in the shorter column to two or more items in the longer column, or can you leave some items unmatched? Read the directions to be sure.
- If one column has a series of single words to be matched to phrases in the other column, read all the phrases first, then all the single words before trying to make any matches. Now go back and read each phrase and find the word that best suits the phrase.
- If both columns have single words to be matched, look to cut down the number of potential matches by grouping them by parts of speech (nouns with nouns, verbs with verbs, etc.).
- As always, start by making the matches that are obvious to you, and then work on the ones that require more thought. Mark off all items you have already used so you can easily see which words or phrases still remain to be matched.
Short Answer Questions
- Short answer questions are designed for you to recall and provide some very specific information (unlike essay questions, which also ask you to apply critical thinking to that information). When you read the question, ask yourself what exactly the instructor wants to know. Keep your answers short and specific.
Essay Questions
- Essay questions are used by instructors to evaluate your thinking and reasoning applied to the material covered in a course. Good essay answers are based on your thoughts, supported by examples from classes and reading assignments.
- Careful planning is critical to answering essay questions effectively. Note how many essay questions you have to answer and how difficult each question seems. Then allocate your time accordingly.
- Read the question carefully and underline or circle keywords.
- Watch for words that describe the instructor’s expectations for your response (see the table below.)
- Use other parts of the exam, like multiple choice, to help you recall vocabulary or specific information.
- If time allows, organize your thoughts by creating a quick outline for your essay. This helps ensure that you don’t leave out key points, and if you run out of time, it may pick up a few points for your grade.
- Jot down the specific information you might want to use, such as names, dates, and places.
- Introduce your essay answer, but get right to the point. Remember that the instructor will be grading dozens of papers and avoid “filler” text that does not add value to your answer.
- For example, rather than writing, “In our study of the Civil War, it is helpful to consider the many facets that lead to conflict, especially the economic factors that help explain this important turning point in our nation’s history,” write a more direct and concise statement like this: “Economic factors help explain the start of the Civil War.”
- Write neatly and watch your grammar and spelling.
- Allow time to proofread your essay. You want your instructor to want to read your essay, not dread it.
- Remember that grading essays is are largely subjective, and a favorable impression can lead to more favorable grading.
- Be sure to answer all parts of the question. Essay questions often have more than one part. Remember, too, that essay questions often have multiple acceptable answers.
Words to Watch for in Essay Questions
| Word | What It Means | What the Instructor Is Looking For |
|---|---|---|
| Analyze | Break concept into key parts | Don’t just list the parts; show how they work together and illustrate any patterns. |
| Compare | Show similarities (and sometimes differences) between two or more concepts or ideas | Define the similarities and clearly describe how the items or ideas are similar. Do these similarities lead to similar results or effects? Note that this word is often combined with “contrast.” If so, make sure you do both. |
| Contrast | Show differences between two or more concepts or ideas | Define the differences and clearly describe how the items or ideas are different. How do these differences result in different outcomes? Note that this word is often combined with “compare.” If so, make sure you do both. |
| Critique | Judge and analyze | Explain what is wrong—and right—about a concept. Include your own judgments, supported by evidence and quotes from experts that support your point of view. |
| Define | Describe the meaning of a word, phrase, or concept | Define the concept or idea as your instructor did in class—but use your own words. If your definition differs from what the instructor presented, support your difference with evidence. Keep this essay short. Examples can help illustrate a definition, but remember that examples alone are not a definition. |
| Discuss | Explain or review | Define the key questions around the issue to be discussed and then answer them. Another approach is to define the pros and cons on the issue and compare and contrast them. In either case, explore all relevant data and information. |
| Explain | Clarify, give reasons for something | Clarity is key for these questions. Outline your thoughts carefully. Proofread, edit, proofread, and proofread again! Good explanations are often lost in too many words. |
| Illustrate | Offer examples | Use examples from class material or reading assignments. Compare and contrast them to other examples you might come up with from additional reading or real life. |
| Prove | Provide evidence and arguments that something is true | Instructors who include this prompt in an exam question have often proven the hypothesis or other concepts in their class lectures. Think about the kind of evidence the instructor used and apply similar types of processes and data. |
| Summarize | Give a brief, precise description of an idea or concept | Keep it short, but cover all key points. This is one essay prompt where examples should not be included unless the instructions specifically ask for them. (For example, “Summarize the steps of the learning cycle and give examples of the main strategies you should apply in each one.”) |
Below is another video from College Info Geek called 10 Ways to Avoid Making Stupid Mistakes on Exams.
Practicing Academic Integrity On Exams
Throughout this book, we have focused on the active process of learning, not just on how to get good grades. The attitude of some students that grades are the end-all in academics has led many students to resort to academic dishonesty to try to get the best possible grades or handle the pressure of an academic program. Although you may be further tempted if you’ve heard people say, “Everybody does it,” or “It’s no big deal at my school,” you should be mindful of the consequences of cheating:
- You don’t learn as much. Cheating may get you the right answer on a particular exam question, but it won’t teach you how to apply knowledge in the world after school, nor will it give you a foundation of knowledge for learning the more advanced material. When you cheat, you cheat yourself out of opportunities.
- You risk failing the course or even expulsion from school. Each institution has its own definitions of and penalties for academic dishonesty, but most include cheating, plagiarism, and fabrication or falsification. The exact details of what is allowed or not allowed vary somewhat among different colleges and even instructors, so you should be sure to check your school’s Web site and your instructor’s guidelines to see what rules apply. Ignorance of the rules is seldom considered a valid defense.
- Cheating causes stress. Fear of getting caught will cause you stress and anxiety; this will get in the way of performing well with the information you do know.
- You’re throwing away your money and time. Getting a college education is a big investment of money and effort. You’re simply not getting your full value when you cheat because you don’t learn as much.
- You are trashing your integrity. Cheating once and getting away with it makes it easier to cheat again, and the more you cheat, the more comfortable you will feel with giving up your integrity in other areas of life—with perhaps even more serious consequences.
- Cheating lowers your self-esteem. If you cheat, you are telling yourself that you are simply not smart enough to handle learning. It also robs you of the feeling of satisfaction from genuine success.
Technology has made it easier to cheat. Your credit card and an Internet connection can procure a paper for you on just about any subject and length. You can copy and paste for free from various Web sites. Students have made creative use of texting and video on their cell phones to gain unauthorized access to material for exams. But be aware that technology has also created ways for instructors to easily detect these forms of academic dishonesty. Most colleges make these tools available to their instructors. Instructors are also modifying their testing approaches to reduce potential academic misconduct by using methods that are harder to cheat at (such as in-class essays that evaluate your thinking and oral presentations).
If you feel uneasy about doing something in your college work, trust your instincts. Confirm with the instructor that your intended form of research or use of the material is acceptable. Cheating just doesn’t pay.
Examples of Academic Dishonesty
Academic dishonesty can take many forms, and you should be careful to avoid them. The following list from Northwestern University is a clear and complete compilation of what most institutions will consider unacceptable academic behavior.
- Cheating: using unauthorized notes, study aids, or information on an examination; altering a graded work after it has been returned, then submitting the work for regrading; allowing another person to do one’s work and submitting that work under one’s own name; submitting identical or similar papers for credit in more than one course without prior permission from the course instructors.
- Plagiarism: submitting material that in part or whole is not entirely one’s own work without attributing those same portions to their correct source. You can read more about plagiarism in Chapters 2 and 14.
- Fabrication: falsifying or inventing any information, data, or citation; presenting data that were not gathered in accordance with standard guidelines defining the appropriate methods for collecting or generating data and failing to include an accurate account of the method by which the data were gathered or collected.
- Obtaining an Unfair Advantage: (a) stealing, reproducing, circulating, or otherwise gaining access to examination materials prior to the time authorized by the instructor; (b) stealing, destroying, defacing, or concealing library materials with the purpose of depriving others of their use; (c) unauthorized collaboration on an academic assignment; (d) retaining, possessing, using or circulating previously given examination materials, where those materials clearly indicate that they are to be returned to the instructor at the conclusion of the examination; (e) intentionally obstructing or interfering with another student’s academic work; or (f) otherwise undertaking an activity with the purpose of creating or obtaining an unfair academic advantage over other students’ academic work.
- Aiding and Abetting Academic Dishonesty: (a) providing material, information, or other assistance to another person with knowledge that such aid could be used in any of the violations stated above, or (b) providing false information in connection with any inquiry regarding academic integrity.
- Falsification of Records and Official Documents: altering documents affecting academic records; forging signatures of authorization or falsifying information on an official academic document, grade report, letter of permission, petition, drop/add form, ID card, or any other official University document.
- Unauthorized Access to computerized academic or administrative records or systems: viewing or altering computer records, modifying computer programs or systems, releasing or dispensing information gained via unauthorized access, or interfering with the use or availability of computer systems or information.
Using Test Results
So far, we have focused on how to study for and take tests effectively. This section discusses how to use test results to their greatest benefit. Some of your most important learning begins when your graded test paper is returned to you. Your first reaction, of course, is to see what grade you received and how you did compared with your classmates. This is a natural reaction.
Make sure you listen to the instructor as the papers are returned. What is the instructor saying about the test? Is there a particular point everyone had trouble with? Does the instructor generally think everyone did well? The instructor’s comments at this point may give you important information about what you should study more, about the value of review sessions, and even about possible questions for the next exam.
Although you may be tempted to throw away the exam, don’t. It is a very helpful tool for the next phase of preparing for learning. This is a three-step process, beginning with evaluating your results.
Evaluating Your Test Results
When you receive your test back, sit quietly and take a close look at it. What questions did you get wrong? What kind of mistakes were they? (See Table: “Exam Errors and How to Correct Them”.) Do you see a pattern? What questions did you get right? What were your strengths? What can you learn from the instructor’s comments?
Now think of the way in which you prepared for the exam and the extent to which you applied the exam strategies described earlier in this chapter. Were you prepared for the exam? Did you study the right material? What surprised you? Did you read the entire test before starting? Did your time allocation work well, or were you short of time on certain parts of the exam?
Table: Exam Errors and How to Correct Them
| Type of Error | Examples | Corrective Steps |
|---|---|---|
| Study and Preparation Errors | I did not study the material for that question (enough). | Practice predicting possible questions better. |
| I ran out of time. | Join a study group. | |
| I did not prepare enough. | Read the entire test before starting. Allocate your time. | |
| Focus Errors or Carelessness | I did not read the directions carefully. | Allocate exam time carefully. |
| I confused terms or concepts that I actually know well. | Give yourself time to read carefully and think before answering a question. | |
| I misread or misunderstood the question. | ||
| Content Errors | I studied the material but couldn’t make it work with the question | Seek additional help from the instructor. |
| I didn’t understand what the instructor wanted. | Go to all classes, labs, and review sessions. | |
| I confused terms or concepts. | Join a study group. | |
| Check and practice your active reading and listening skills. | ||
| Schedule regular study time for this course. | ||
| Mechanical Errors | The instructor misread my writing. | Slow down! Don’t rush through the exam. Take the time to do things right the first time. |
| I didn’t erase a wrong answer completely (on a computer-graded answer sheet). | ||
| I forgot to go back to a question I had skipped over. | ||
| I miscopied some calculations or facts from my worksheet. |
Based on your analysis of your test, identify the kind of corrective steps you should take to improve your learning and test performance. Implement those steps as you begin your preparation for your next class. If you don’t learn from your mistakes, you are doomed to repeat them; if you don’t learn from your successes, it will be harder to repeat them.
Correcting Your Mistakes
The second step in making your test work for you is to correct your wrong answers. The last time you wrote the information (when you took the test), you created a link to the wrong information in your memory, so that must be corrected.
- For multiple-choice questions, write out the question stem with the correct answer to form a single correct sentence or phrase.
- For true-or-false questions, write the full statement if it is true; if it is false, reword it in such a way that it is true (such as by inserting the word “not”). Then write the new statement.
- For math and science questions involving calculations, redo the entire solution with the calculations written out fully.
- You need not rewrite an entire essay question if you did not do well, but you should create a new outline for what would be a correct answer. Make sure you incorporate any ideas triggered by your instructor’s comments.
- When you have rewritten all your answers, read them all out loud before incorporating your new answers in your notes.
Integrating Your Test into Your Study Guide
Your corrected quizzes and midterm exams are important study tools for final exams. Make sure you file them with your notes for the study unit. Take the time to annotate your notes based on the exam. Pay particular attention to any gaps in your notes on topics that appeared in the quiz or exam. Research those points in your text or online and complete your notes. Review your exams throughout the term (not just before the final) to be sure you cement the course material into your memory.
When you prepare for the final exam, start by reviewing your quizzes and other tests to predict the kinds of questions the instructor may ask on the final. This will help focus your final studying when you have a large amount of coursework to cover.
If You Don’t Get Your Test Back
If your instructor chooses not to return tests to students, make an appointment to see the instructor soon after the test to review it and your performance. Take notes on what you had trouble with and the expected answers. Add these notes to your study guide. Make sure you don’t lose out on the opportunity to learn from your results.
KEY TAKEAWAYS
- Some stress before a test or exam is common and beneficial but test anxiety is stress that gets in the way of performing effectively.
- The most common causes of test anxiety are a lack of preparation and negative attitudes.
- The key to combating test anxiety is to try to reduce stressors to a manageable level rather than try to eliminate them totally.
- Effective studying happens over time, not just a few days before an exam. Consistent and regular review time helps you learn the material better and saves you time and anguish as exam time approaches.
- Study groups are a great idea, provided they are thoughtfully managed.
- In addition to studying, prepare for exams and quizzes by getting plenty of rest, eating well, and getting some exercise the day before the exam.
- Before the exam, learn as much as you can about the kinds of questions your instructor will be asking and the specific material that will be covered.
- The first step to the successful completion of an exam is to browse the entire exam and develop a plan (including a “time budget”) for completing the exam.
- Read questions carefully. Underline keywords in questions, particularly in essay questions and science questions.
- Being dishonest can have major consequences that can affect not only your college career but also your life beyond college.
- When you cheat, you are primarily cheating yourself.
- Working with exams does not end when your instructor hands back your graded test.
- Quizzes and midterms are reliable predictors of the kind of material that will be on the final exam.
- When evaluating your test performance, don’t look only at the content you missed. Identify the types of mistakes you commonly make and formulate plans to prevent these mistakes in future assessments.
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- Chapter 6: Preparing for and Taking Tests. in College Success. Authored by: Anonymous. Provided by: University of Minnesota. Located at: http://www.oercommons.org/courses/college-success/view. License: CC BY-NC-SA-4.0
- Testing Strategies in EDUC 1300. Authored by: Linda Bruce. Provided by: Lumen Learning. Located at: https://courses.lumenlearning.com/sanjacinto-learningframework/chapter/testing-strategies/. License: CC BY 4.0
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- Test Anxiety: How to Take On Your Exams Without Stress - College Info Geek. Authored by: Thomas Frank. Located at: https://www.youtube.com/watch?v=fHfHSq7PVDU. License: All Rights Reserved. License Terms: Standard YouTube
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Chapter 14: Effective Writing
Overview
Learning Framework: Effective Strategies for College Success
Chapter 14: Effective Writing
Learning Objectives
By the end of this chapter, you will be able to:
- Describe the importance of good writing skills.
- Define “academic writing" and explain the key aspects of academic writing.
- Define what instructors expect of a college student’s writing.
- Understand and utilize the five writing-process steps.
- Differentiate between revision and proofreading, and explain the value of each.
- Know where to get help with your writing.
- Understand the principles of academic integrity.
- Identify strategies for ethical use of sources in writing.
Effective Writing
The Importance Of Writing Skills
Writing is one of the key skills all successful students must acquire. You might think your main job in a history class is to learn facts about events. So you read your textbook and take notes on important dates, names, causes, etc. But however important these details are to your instructor, they don’t mean much if you can’t explain them in writing. Even if you remember the facts and believe you understand their meaning completely, if you can’t express your understanding by communicating it—in college that almost always means in writing—then as far as others may know, you don’t have an understanding. In a way, learning history is learning to write about history.
History is just one example. Consider a lab course—a class that’s as much hands-on as any in college. At some point, you’ll be asked to write a step-by-step report on an experiment you have run. The quality of your lab work will not show if you cannot describe that work and state your findings well in writing. Even though instructors in courses other than English classes may not comment directly on your writing, their judgment of your understanding will still be mostly based on what you write. This means that in all your courses, not just your English courses, instructors expect good writing.
In college courses, writing is how ideas are exchanged, from scholars to students and from students back to scholars. While the grade in some courses may be based mostly on class participation, oral reports, or multiple-choice exams, writing is by far the single most important form of instruction and assessment.
If you find that a scary thought, take heart! By paying attention to your writing and learning and practicing basic skills, even those who never thought of themselves as good writers can succeed in college writing. As with other college skills, getting off to a good start is mostly a matter of being motivated and developing a confident attitude that you can do it. Research shows that deliberate practice—that is, close focus on improving one’s skills—makes all the difference in how one performs.
A survey of employers conducted by the Association of American Colleges and Universities found that 89 percent of employers say that colleges and universities should place more emphasis on “the ability to effectively communicate orally and in writing.” In addition, several of the other valued skills are grounded in written communication: “Critical thinking and analytical reasoning skills” (81 percent); “The ability to analyze and solve complex problems” (75 percent); and “The ability to locate, organize, and evaluate information from multiple sources” (68 percent).
The payoff for improving your writing comes much sooner than graduation. Suppose you complete about 40 classes for a 120-credit bachelor's degree, and—averaging across writing-intensive and non-writing-intensive courses—you produce about 2,500 words of formal writing per class. Even with that low estimate, you’ll write 100,000 words during your college career. That’s roughly equivalent to a 330-page book.
Spending a few hours sharpening your writing skills will make those 100,000 words much easier and more rewarding to write. All of your professors care about good writing.
What is Academic Writing?
Writing in college is a fairly specialized writing situation, and it has developed its own codes and conventions that you need to have a keen awareness of if you are going to write successfully in college. Let’s break down the writing situation in college:
| Who’s your audience? | Primarily the professor and possibly your classmates (though you may be asked to include a secondary outside audience). |
| What’s the occasion or context? | An assignment given by the teacher within a learning context and designed to have you learn and demonstrate your learning. |
| What’s your message? | It will be your learning or the interpretation gained from your study of the subject matter. |
| What’s your purpose? | To show your learning and get a good grade (or to accomplish the goals of the writing assignment). |
| What documents/ genres are used? | The essay is the most frequent type of document used. |
Every form of writing has its conventions. How we write text messages to our friends is different from how we write a job application; the language used in a soap opera is different from the language used on the news. And the language of academic writing has its own set of characteristics.
As a basic rule, academic writing is more formal than the everyday language we tend to use for communication. But at the same time, academic writing isn't about impressing people with ‘big words’ or being overly formal. It needs to be clear, concise, and objective so that you can communicate your ideas effectively.
Compare these two sentences - they contain the same information, but the better style example is much shorter, simpler, and easier to understand.
Poor style: The primary ambition of expressing concepts in an academic fashion is to provide assistance for the audience of the piece in comprehending the information being conveyed in an expeditious and accessible manner.
Better style: Effective academic writing helps readers understand your points quickly and easily.
Instead of being formal, academic writing uses neutral words and avoids informal, conversational, or colloquial language. For example, 'many factors' is more academic than 'loads of things'. Also, avoid personal language - you're not the focus of the work (unless it's a reflective assignment like those often found in this EDUC course). You should also generally use objective language, for example, "it is really bad" is subjective, but "a key negative consequence" is objective.
Be Clear
Clarity is a key aspect of academic writing style. This helps the reader understand and follow your points easily.
- Break down long, complex sentences into shorter, clearer sentences.
- Don’t use formal or unusual words where you can use a ‘normal’ one.
- You won’t get points for being overly formal, or ‘sounding like an academic ’ - probably the opposite, as this makes your writing harder to follow.
Be concise
Academic writing also aims to be concise and use as few words as possible. Remove words and phrases that don’t add anything to your argument. This makes your writing clearer and means you’ll have more words to make your points with. After writing a paragraph, read it back and remove any unnecessary words. Be ruthless!
Avoid personal pronouns
Usually, you're not the focus of the writing, so using personal pronouns can make the important aspects of your writing harder to identify. We also know that you wrote the work, or that you did the research, so you don't need to tell us this.
Avoiding personal pronouns like "I" helps you focus on what's important:
- I will argue that... → This essay will argue that...
- I tested the samples → Samples were tested
The exception is reflective writing. In this case, you may use personal language to discuss your own experiences.
Be objective
Academic writing is based on objective arguments. Using personal or emotive language makes your writing subjective and more opinion-based, and so weakens these arguments.
- I think X is the best solution. → Based on this evidence, it seems X is the best solution.
- In my opinion, this happened because... → The reasons for this are...
- Many people believe that... → It is widely believed that...
- avoid emotive and subjective words like "unfortunately", "luckily" etc.
Use Structure
Academic writing has a clear, logical structure to communicate your points and show the connections between them; a well-structured assignment is easy for the reader to follow and understand.
These general principles apply to structuring most types of academic writing:
- Use a linear structure where points build on each other - don't jump backward and forwards.
- Start with more general and then move to the more specific ideas and points.
- Put more relevant/important information first.
- Everything is relevant to the main argument or point of the paragraph.
- Use cohesion to join ideas and points clearly - don't make the reader do the work.
- Follow any structural requirements for your assignment or type of writing.
The best way to write a well-structured assignment is to have a good plan before you start writing. What's your argument? What are the main points you want to include? What's a logical way to order these points? Don't just launch into writing with no idea of where you're going!
To make a general plan:
- Make a list of the information and points to include.
- Organize similar points into groups.
- Put the groups in a logical order.
- Within each group, organize the points logically.
- Check the plan to make sure it meets task requirements.
Paragraph Structure
A well-structured paragraph contains one main point or idea - all the information included is relevant to this point. If it's not related to the main point, it probably shouldn't be there!
There are many ways to structure a paragraph, but they generally all include:
- a topic sentence showing the main point
- the body of the paragraph, integrating:
- development of the point: more detail, examples, etc.
- evidence to support the point
- critical analysis showing how evidence relates to the main point
- a final wrap-up linking to the overall argument or the next paragraph
However, this is only a guide - there are many ways to structure a paragraph. Reading sources from your field will help you to get a feel of ways to organize paragraphs.
Be Cohesive
Cohesive words and phrases are used heavily in academic writing style to smoothly link points. They're generally small and fairly simple but are integral to communicating your argument. If the structure is the order of your points, cohesion is what ties them together and guides the reader through your argument.
Create cohesion using words and phrases that show the relationships between points. For example:
- basic connectives: and, or, but, so
- giving more detail: for example, to illustrate, an example of this is
- showing contrast: however, although, while, conversely, alternatively
- showing similarity: another, also, similarly, collectively, taken together
- cause/effect: leading to, the effect of this is, therefore, may stem from
- referencing words: this/that, who, which/that, the groups, these findings
- showing implications: this suggests that, these findings may mean that, based on this
Myths About College Writing
There are many misconceptions about college writing. Here are a few myths that can lead to problems in writing.
Myth #1: The “Paint by Numbers” myth
Some writers believe they must perform certain steps in a particular order to write “correctly.” Rather than being a lock-step linear process, writing is “recursive.” That means we cycle through and repeat the various activities of the writing process many times as we write.
Myth #2: Writers only start writing when they have everything figured out
Writing is not like sending a fax! Writers figure out much of what they want to write as they write it. Rather than waiting, get some writing on the page—even with gaps or problems. You can come back to patch up rough spots.
Myth #3: Perfect first drafts
We put unrealistic expectations on early drafts, either by focusing too much on the impossible task of making them perfect (which can put a cap on the development of our ideas), or by making too little effort because we don’t care or know about their inevitable problems. Nobody writes perfect first drafts; polished writing takes lots of revision.
Myth #4: Some got it; I don’t—the genius fallacy
When you see your writing ability as something fixed or out of your control (as if it were in your genetic code), then you won’t believe you can improve as a writer and are likely not to make any efforts in that direction. With effort and study, though, you can improve as a writer.
Myth #5: Good grammar is good writing
When people say “I can’t write,” what they often mean is they have problems with grammatical correctness. Writing, however, is about more than just grammatical correctness. Good writing is a matter of achieving your desired effect on an intended audience. Plus, as we saw in Myth #3, no one writes perfect first drafts.
Myth #6: The Five-Paragraph Essay
Some people say to avoid it at all costs, while others believe no other way to write exists. With an introduction, three supporting paragraphs, and a conclusion, the five-paragraph essay is a format you should know, but one which you will outgrow. You’ll have to gauge the particular writing assignment to see whether and how this format is useful for you.
Myth #7: Never use “I”
Adopting this formal stance of objectivity implies a distrust (almost fear) of informality and often leads to artificial, puffed-up prose. Although some writing situations will call on you to avoid using “I” (for example, a lab report), much college writing can be done in a middle, semi-formal style where it is ok to use “I.”
What Do Instructors Want?
Successful academic writing starts with recognizing what the instructor is requesting, or what you are required to do. So pay close attention to the assignment. Sometimes the essential information about an assignment is conveyed through class discussions, however, so be sure to listen for the keywords that will help you understand what the instructor expects. If you feel the assignment does not give you a sense of direction, seek clarification.
Some instructors may say they have no particular expectations for student papers. This is partly true. College instructors do not usually have one right answer in mind or one right approach to take when they assign a paper topic. They expect you to engage in critical thinking and decide for yourself what you are saying and how to say it. But in other ways, college instructors do have expectations, and it is important to understand them. Some expectations involve mastering the material or demonstrating critical thinking. Other expectations involve specific writing skills. Most college instructors expect certain characteristics in student writing. Here are general principles you should follow when writing essays or student “papers.” (Some may not be appropriate for specific formats such as lab reports.)
Title the paper to identify your topic. This may sound obvious, but it needs to be said. Some students think of a paper as an exercise and write something like “Assignment 2: History 101” on the title page. Such a title gives no idea about how you are approaching the assignment or your topic. Your title should prepare your reader for what your paper is about or what you will argue. (With essays, always consider your reader as an educated adult interested in your topic. An essay is not a letter written to your instructor.) Compare the following:
Incorrect: Assignment 2: History 101
Correct: Why the New World Was Not “New”
It is obvious which of these two titles begins to prepare your reader for the paper itself. Similarly, don’t make your title the same as the title of a work you are writing about. Instead, be sure your title signals an aspect of the work you are focusing on:
Incorrect: Catcher in the Rye
Correct: Family Relationships in Catcher in the Rye
Address the terms of the assignment. Again, pay particular attention to words in the assignment that signal a preferred approach. If the instructor asks you to “argue” a point, be sure to make a statement that expresses your idea about the topic. Then follow that statement with your reasons and evidence in support of the statement. Look for any signals that will help you focus or limit your approach. Since no paper can cover everything about a complex topic, what is it that your instructor wants you to cover?
Finally, pay attention to the little things. For example, if the assignment specifies “5 to 6 pages in length,” write a five- to six-page paper. Don’t try to stretch a short paper longer by enlarging the font (12 points is standard) or making your margins bigger than the normal one inch (or as specified by the instructor). If the assignment is due at the beginning of class on Monday, have it ready then or before. Do not assume you can negotiate a revised due date.
In your introduction, define your topic and establish your approach or sense of purpose. Think of your introduction as an extension of your title. Instructors (like all readers) appreciate being oriented by a clear opening. They appreciate knowing that you have a purpose for your topic—that you have a reason for writing the paper. If they feel they’ve just been dropped into the middle of a paper, they may miss important ideas. They may not make the connections you want them to make.
Build from a thesis or a clearly stated sense of purpose. Many college assignments require you to make some form of argument. To do that, you generally start with a statement that needs to be supported and build from there. Your thesis is that statement; it is a guiding assertion for the paper. Be clear in your mind about the difference between your topic and your thesis. The topic is what your paper is about; the thesis is what you argue about the topic. Some assignments do not require an explicit argument and thesis, but even then you should make clear at the beginning your main emphasis, your purpose, or your most important idea.
Develop ideas patiently. You might, like many students, worry about boring your reader with too much detail or information. However, college instructors will not be bored by carefully explained ideas, well-selected examples, and relevant details. College instructors, after all, are professionally devoted to their subjects. If your sociology instructor asks you to write about youth crime in rural areas, you can be sure they are interested in that subject.
Integrate—do not just “plug-in”—quotations, graphs, and illustrations. As you outline or sketch out your material, you will think things like “This quotation can go here” or “I can put that graph there.” Remember that a quotation, graph, or illustration does not make a point for you. You make the point first and then use such material to help back it up. Using a quotation, a graph, or an illustration involves more than simply sticking it into the paper. Always lead into such material. Make sure the reader understands why you are using it and how it fits in at that place in your presentation.
Build clear transitions at the beginning of every paragraph to link from one idea to another. A good paper is more than a list of good ideas. It should also show how the ideas fit together. As you write the first sentence of any paragraph, have a clear sense of what the prior paragraph was about. Think of the first sentence in any paragraph as a kind of bridge for the reader from what came before.
Document your sources appropriately. If your paper involves research of any kind, indicate the use you make of outside sources. If you have used those sources well, there is no reason to hide them. Careful research and the thoughtful application of the ideas and evidence of others are part of what college instructors value.
Carefully edit your paper. College instructors assume you will take the time to edit and proofread your essay. A misspelled word or an incomplete sentence may signal a lack of concern on your part. It may not seem fair to make a harsh judgment about your seriousness based on little errors, but in all writing, impressions count. Since it is often hard to find small errors in our own writing, ask a classmate or a friend to review it and mark any word or sentence that seems “off” in any way. Although you should certainly use a spell-checker, don’t assume it can catch everything.
Turn in a clean hard copy. Some instructors accept or even prefer digital papers, but do not assume this. Some instructors want a paper copy. Present your paper in a professional (and unfussy) way, using a staple or paper clip on the left top to hold the pages together (unless the instructor specifies otherwise). If submitting digitally, make sure the formatting you intended remains intact after you upload the file. Review the uploaded file carefully before pressing "submit." And, be sure you are uploading the file type requested by your instructor/
The Writing Process
The following video provides a thorough overview of the five steps of the writing process.
No writer, not even a professional, composes a perfect draft in her first attempt. Every writer fumbles and has to work through a series of steps to arrive at a high-quality finished project.
You may have encountered these steps as assignments in classes—draft a thesis statement, complete an outline, turn in a rough draft, and participate in a peer review. The further you get into higher education, the less often these steps will be completed as part of a class.
That’s not to say that you won’t still need to follow these steps on your own. It helps to recognize that these steps, commonly, referred to as the writing process, aren’t rigid and prescribed. Instead, it can be liberating to see them as flexible, allowing you to adapt them to your personal habits, preferences, and the topic at hand. You will probably find that your process changes, depending on the type of writing you’re doing and your comfort level with the subject matter.
Consider the following flowchart of the writing process:
The writing process can be summed up in five steps: pre-writing, planning and outlining, drafting, revising, and editing (proofreading.) Keep in mind that it isn’t always a linear process, though. It’s okay to loop back to earlier steps again if needed. For instance, after completing a draft, you may realize that a significant aspect of the topic is missing, which sends you back to researching. Or the process of research may lead you to an unexpected subtopic, which shifts your focus and leads you to revise your thesis. Embrace the circular path that writing often takes!
Because writing is sometimes hard, procrastination is easy. Don’t let yourself put off the task. Use the time management strategies described in Chapter 4. One good approach is to schedule shorter periods over a series of days, rather than trying to sit down for one long period to accomplish a lot. (Even professional writers can write only so much at a time.)
- Prewriting. This stage is for generating ideas, understanding the ideas of others, and collecting information (note-taking, free-writing, brainstorming, researching, etc.) This is where you will decide on the specific topic of your paper.
- Planning and Outlining. Here, you are organizing and focusing on ideas. You are making a plan for your writing, which can include an outline or a mind map.
- Drafting. In the drafting stage, you are writing initial drafts of a text focusing mainly on the development, organization, and elaboration of ideas.
- Revision. In the revision stage, let the work sit and come back to it later with a fresh set of eyes. You may cycle back between drafting and revision several times before moving on. This is also a good time to get feedback from others. In the revision stage, you are further developing and clarifying ideas and the structure of the text. If the work requires additional research or idea generation, return to the planning stage.
- Editing and Proofreading. Here the focus is on surface-level features of the text. This is where you correct grammar, spelling, and punctuation.
What’s the Difference Between Revision and Editing?
These last two stages of the writing process are often confused with each other, but they mean very different things and serve very different purposes.
Revision is literally “reseeing.” It asks a writer to step away from a piece of work for a significant amount of time and return later to see it with new eyes. This is why the process of producing multiple drafts of an essay is so important. It allows some space in between, to let thoughts mature, connections to arise, and gaps in content or an argument to appear. It’s also difficult to do, especially given that most college students face tight timelines to get big writing projects done. Still, there are some tricks to help you “re-see” a piece of writing when you’re short on time, such as reading a paper backward, sentence by sentence, and reading your work aloud. Both are ways of reconceptualizing your writing so you approach it from a fresh perspective. Whenever possible, build in at least a day or two to set a draft aside before returning to work on the final version.
Revising a draft usually involves significant changes including the following:
- Making organizational changes like the reordering of paragraphs (don’t forget that new transitions will be needed when you move paragraphs).
- Clarifying the thesis or adjustments between the thesis and supporting points that follow.
- Cutting material that is unnecessary or irrelevant.
- Adding new points to strengthen or clarify the presentation.
Editing and Proofreading are the last steps following revision. This is the point where spelling, grammar, punctuation, and formatting all take center stage.
Editing and proofreading are focused, late-stage activities for style and correctness. They are important final parts of the writing process, but they should not be confused with revision itself. Editing and proofreading a draft involve these steps:
- Careful spell-checking. This includes checking the spelling of names.
- Attention to sentence-level issues. Be especially attentive to sentence boundaries, subject-verb agreement, punctuation, and pronoun referents. You can also attend at this stage to matters of style.
A person can be the best writer in the world and still be a terrible proofreader. It’s okay not to memorize every rule out there, but to know where to turn for help. Utilizing the grammar-check feature of your word processor is a good start, but it won’t solve every issue. There are also programs you can use such as Grammarly.
Finding a trusted person to help you edit is perfectly ethical, as long as that person offers you advice and doesn’t do any of the writing for you. Professional writers rely on outside readers for the revision and editing process, and it’s good practice for you to do so, too.
Remember to get started on a writing assignment early so that you complete the first draft well before the due date, allowing you time for genuine revision and careful editing.
CHECKLISTS FOR REVISION AND EDITING
When you revise…
| Check the assignment: does your paper do what it’s supposed to do? | |
| Check the title: does it clearly identify the overall topic or position? | |
| Check the introduction: does it set the stage and establish the purpose? | |
| Check each paragraph in the body: does each begin with a transition from the preceding? | |
| Check the organization: does it make sense why each topic precedes or follows another? | |
| Check development: is each topic fully explained, detailed, supported, and exemplified? | |
| Check the conclusion: does it restate the thesis and pull key ideas together? |
When you edit…
| Read the paper aloud, listening for flow and natural word style. | |
| Check for any lapses into slang, colloquialisms, or nonstandard English phrasing. | |
| Check sentence-level mechanics: grammar and punctuation (pay special attention to past writing problems). | |
| When everything seems done, run the spell-checker again and do a final proofread. | |
| Check physical layout and mechanics against instructor’s expectations: Title page? Font and margins? Endnotes? |
Getting Help with Writing
Writing can be hard work. Most colleges provide resources that can help you from the early stages of an assignment through to the completion of an essay. Your first resource may be a writing class. Most students are encouraged or required to enroll in a writing class in their first term, and it’s a good idea for everyone. Use everything you learn there about drafting and revising in all your courses.
Most colleges have a tutoring service that focuses primarily on student writing. At ACC, you can request help from the Learning Lab Tutors, either virtually or in person at any of the campuses. You can also get assistance from The Writing Center.
Three points about writing tutors are crucial:
- Writing tutors are there for all student writers—not just for weak or inexperienced writers. Writing in college is supposed to be a challenge. Some students make writing even harder by thinking that good writers work in isolation. But writing is a social act. A good paper should engage others.
- Tutors are not there for you to “correct” sentence-level problems or polish your finished draft. They will help you identify and understand sentence-level problems so that you can achieve greater control over your writing. But, their more important goals often are to address larger concerns like the paper’s organization, the fullness of its development, and the clarity of its argument. So don’t make your first appointment the day before a paper is due, because you may need more time to revise after discussing the paper with a tutor.
- Tutors cannot help you if you do not do your part. Tutors respond only to what you say and write; they cannot enable you to magically jump past the thinking an assignment requires. So do some thinking about the assignment before your meeting and be sure to bring relevant materials with you. For example, bring the paper assignment. You might also bring the course syllabus and perhaps even the required textbook. Most importantly, bring any writing you’ve done in response to the assignment (an outline, a thesis statement, a draft, an introductory paragraph). If you want to get help from a tutor, you need to give the tutor something to work with.
The ACC Library is a great resource for writing papers. You can go to any ACC campus library, email them, call them, zoom them, and there is even a 24-hour live chat. They can help you find appropriate sources, show you how to use citation tools, and help you with citing sources,
Writing Websites and writing handbooks. Many writing websites and handbooks can help you along every step of the way, especially in the late stages of your work. You’ll find lessons on style as well as information about language conventions and “correctness.” Not only should you use the handbook your composition instructor assigns in a writing class, but you should not sell that book back at the end of the term. You will need it again for future writing. For more help, become familiar with a good Web site for student writers. There are many, but here are a few recommended ones:
Purdue Online Writing Lab (OWL)
Handouts from the Writing Center at UNC-Chapel Hill
Practicing Academic Integrity
At most educational institutions, “academic honesty” means demonstrating and upholding the highest integrity and honesty in all the academic work that you do. In short, it means doing your own work, not cheating, and not presenting the work of others as your own. ACC has a detailed Academic Integrity Process. ACC's Value Statement on Academic Integrity states:
"Acts of academic dishonesty/misconduct undermine the learning process, present a disadvantage to students who earn credit honestly, and subvert the academic mission of the institution. The potential consequences of fraudulent credentials raise additional concerns for individuals and communities beyond campus who rely on institutions of higher learning to certify students’ academic achievements, and expect to benefit from the claimed knowledge and skills of their graduates."
The following are some common forms of academic dishonesty prohibited by most academic institutions:
Cheating
Cheating can take the form of cheat sheets, looking over someone’s shoulder during an exam, or any forbidden sharing of information between students regarding an exam or exercise. Many elaborate methods of cheating have been developed over the years—storing information in graphing calculators, checking cell phones during bathroom breaks, using apps like Chegg to complete your homework or a take-home exam, using online solutions, using AI to write papers or answer exam questions, etc. Cheating differs from most other forms of academic dishonesty, in that people can engage in it without benefiting themselves academically. For example, a student who illicitly texted answers to a friend during a test would be cheating, even though the student’s own work is in no way affected.
Deception
Deception is providing false information to an instructor concerning an academic assignment. Examples of this include taking more time on a take-home test than is allowed, giving a dishonest excuse when asking for a deadline extension, or falsely claiming to have submitted work. Essentially, it's lying to your instructor.
Fabrication
Fabrication is the falsification of data, information, or citations in an academic assignment. This includes making up citations to back up arguments or inventing quotations. Fabrication is most common in the natural sciences, where students sometimes falsify data to make experiments “work” or false claims are made about the research performed.
Plagiarism
Plagiarism, as defined in the 1995 Random House Compact Unabridged Dictionary, is the “use or close imitation of the language and thoughts of another author and the representation of them as one’s own original work.” In an academic setting, it is seen as the adoption or reproduction of original intellectual creations (such as concepts, ideas, methods, pieces of information or expressions, etc.) of another author (whether an individual, group, or organization) without proper acknowledgment. This can range from borrowing a particular phrase or sentence to paraphrasing someone else’s original idea without citing it. Today, in our networked digital world, the most common form of plagiarism is copying and pasting online material without crediting the source. This includes copying AI generated text.
Common Forms of Plagiarism
According to “The Reality and Solution of College Plagiarism” created by the Health Informatics Department of the University of Illinois at Chicago, there are ten main forms of plagiarism that students commit:
- Submitting someone else’s work as their own (this includes AI-generated work).
- Taking passages from their own previous work without adding citations (submitting a paper you previously wrote for another class or another assignment).
- Rewriting someone’s work without properly citing sources (this includes AI-generated work).
- Using quotations, but not citing the source.
- Interweaving various sources together in the work without citing.
- Citing some, but not all passages that should be cited.
- Melding together cited and uncited sections of the piece.
- Providing proper citations, but failing to change the structure and wording of the borrowed ideas enough.
- Inaccurately citing the source.
- Relying too heavily on other people’s work. Failing to bring original thought into the text.
As a college student, you are now a member of a scholarly community that values other people’s ideas. You will routinely be asked to reference and discuss other people’s thoughts and writing in the course of producing your own work. That’s why it’s so important to understand what plagiarism is and the steps you can take to avoid it.
Avoiding Plagiarism
Below are some useful guidelines to help you avoid plagiarism and show academic honesty in your work:
- Quotes: If you quote another work directly, cite your source. This includes AI-generated work.
- Paraphrase: If you put someone else’s idea into your own words, you still need to cite the author.
- Visual Materials: If you cite statistics, graphs, or charts from a study, cite the source. Keep in mind that if you didn’t do the original research, then you need to credit the person(s) or institution, etc. that did.
The easiest way to make sure you don’t accidentally plagiarize someone else’s work is by taking careful notes as you research. If you are researching on the Web, be sure to copy and paste the links into your notes so you can keep track of the sites you’re visiting. Be sure to list all the sources you consult.
There are many handy online tools to help you create and track references as you go. For example, you can try using Son of Citation Machine. Library databases often have a citation generator. Keeping careful notes will not only help you avoid inadvertent plagiarism, but it will also help you if you need to return to a source later (to check or get more information). If you use citation tools like Son of Citation, be sure to check the accuracy of the citations before you submit your assignment.
Lastly, if you’re in doubt about whether something constitutes plagiarism, cite the source or leave the material out. Better still, ask for help. Most colleges have a writing center, a tutoring center, and a library where students can get help with their writing. Taking the time to seek advice is better than getting in trouble for not attributing your sources. Be honest about your ideas, and give credit where it’s due.
Consequences of Plagiarism
In the academic world, plagiarism is considered a serious offense that can result in punishments such as a failing grade on a particular assignment, the entire course, or even being expelled from the institution. Individual instructors and courses may have their own policies regarding academic honesty and plagiarism; statements of these can usually be found in the course syllabus or online course description.
Avoid Plagiarism: Cite Your Sources
College courses offer a few writing opportunities that won’t require using outside resources. Creative writing classes, applied lab classes, or field research classes will value what you create entirely from your own mind or from the work completed for the class. For most college writing, however, you will need to consult at least one outside source, and possibly more.
The following video provides a helpful overview of how sources are used most effectively and responsibly in academic writing.
Note that this video models MLA-style citations. This is one of several different styles you might be asked to practice in your classes. Your instructors should state which of the major styles they expect you to use in their courses.
Regardless of the style, the same principles are true any time a source is used: give credit to the source when it is used in the writing itself, as well as in a bibliography (or Works Cited page, or References page) at the end.
Plagiarism is the unacknowledged use of material from a source. At the most obvious level, plagiarism involves using someone else’s words and ideas as if they were your own. There’s not much to say about copying another person’s work: it’s cheating, pure and simple. But plagiarism is not always so simple. Notice that the definition of plagiarism involves “words and ideas.” Let’s break that down a little further.
Words. Copying the words of another is wrong. If you use another’s words, those words must be in quotation marks, and you must tell your reader where those words came from. But it is not enough to make a few surface changes in wording. You can’t just change some words and call the material yours; an extended paraphrase is not acceptable. For example, compare the two passages that follow. The first comes from Murder Most Foul, a book by Karen Halttunen on changing ideas about murder in nineteenth-century America; the second is a close paraphrase of the same passage:
The new murder narratives were overwhelmingly secular works, written by a diverse array of printers, hack writers, sentimental poets, lawyers, and even murderers themselves, who were displacing the clergy as the dominant interpreters of the crime.
The murder stories that were developing were almost always secular works that were written by many different sorts of people. Printers, hack writers, poets, attorneys, and sometimes even the criminals themselves were writing murder stories. They were the new interpreters of the crime, replacing religious leaders who had held that role before.
It is easy to see that the writer of the second version has closely followed the ideas and even used some of the same words as the original. This is a serious form of plagiarism. Even if this writer were to acknowledge the author, there would still be a problem. To simply cite the source at the end does not excuse using so much of the original source.
Ideas. Ideas are also a form of intellectual property. Consider this third version of the previous passage:
At one time, religious leaders shaped the way the public thought about murder. But in nineteenth-century America, this changed. Society’s attitudes were influenced more and more by secular writers.
This version summarizes the original. That is, it states the main idea in compressed form in language that does not come from the original. However, it could still be seen as plagiarism if the source is not cited. This example may make you wonder if you can write anything without citing a source. To help you sort out what ideas need to be cited and what does not, think about these principles:
Common knowledge. There is no need to cite common knowledge. Common knowledge does not mean knowledge everyone has. It means knowledge that everyone can easily access. For example, most people do not know the date of George Washington’s death, but everyone can easily find that information. If the information or idea can be found in multiple sources and the information or idea remains constant from source to source, it can be considered common knowledge. This is one reason so much research is usually done for college writing—the more sources you read, the more easily you can sort out what is common knowledge: if you see an uncited idea in multiple sources, then you can feel secure that idea is common knowledge.
Distinct contributions. One does need to cite ideas that are distinct contributions. A distinct contribution need not be a discovery from the work of one person. It need only be an insight that is not commonly expressed (not found in multiple sources) and not universally agreed upon.
Disputable figures. Always remember that numbers are only as good as the sources they come from. If you use numbers like attendance figures, unemployment rates, or demographic profiles—or any statistics at all—always cite your source of those numbers. If your instructor does not know the source you used, you will not get much credit for the information you have collected.
Everything said previously about using sources applies to all forms of sources. Some students mistakenly believe that material from the Web, for example, need not be cited. Or that an idea from an instructor’s lecture is automatically common property. You must evaluate all sources in the same way and cite them as necessary.
Forms of Citation. You should check with your instructors about their preferred form of citation when you write papers for courses. No one standard is used in all academic papers. You can learn about the three major forms or styles used in almost any college writing handbook and on many Websites for college writers:
- The Modern Language Association (MLA) system of citation is widely used but is most commonly adopted in humanities courses, particularly literature courses.
- The American Psychological Association (APA) system of citation is most common in the social sciences.
- The Turabian Documentation Style (or Chicago) is widely used but perhaps most commonly in history courses.
Many college departments have their own style guides, which may be based on one of the above. Your instructor should refer you to his or her preferred guide, but be sure to ask if you have not been given explicit direction.
KEY TAKEAWAYS
- Writing is crucial to college success because it is the most common means of evaluation.
- Writers in college must pay close attention to the terms of an assignment.
- Writing is a process that involves several steps; the product will not be good if one does not allow time for the process.
- Seek feedback from classmates, tutors, and instructors during the writing process.
- Revision is not the same thing as editing.
- Understanding and practicing Academic Integrity is a crucial component of college success.
- Words and ideas from sources must be properly cited.
LICENSES AND ATTRIBUTIONS
LICENSES AND ATTRIBUTIONS
CC LICENSED CONTENT, ORIGINAL
- Writing Effectively. Authored by: Heather Syrett. Provided by: Austin Community College. License: CC BY-NC-SA-4.0
CC LICENSED CONTENT, SHARED PREVIOUSLY
- Academic Writing: a Practical Guide in University Library. Provided by: University of York. Located at: https://subjectguides.york.ac.uk/academic-writing/academic-style. License: CC BY-NC-SA-4.0
- Chapter 8: Writing for Classes. in College Success. Authored by: Anonymous. Provided by: University of Minnesota. Located at: http://www.oercommons.org/courses/college-success/view. License: CC BY-NC-SA-4.0
- Editing. Authored by: Joseph M. Moxley. Provided by: Writing Commons. Located at: https://writingcommons.org/section/editing/ License: CC BY-NC-ND 4.0
- What is Academic Writing in Starting the Journey: An Intro to College Writing. Authored by: Lennie L. Irving Provided by: Pressbooks. Located at: https://fsw.pressbooks.pub/enc1101/chapter/thinking-deeper-title-of-article-here/. License: CC BY-NC-SA-4.0
- Writing Processes in Technical Writing Essentials. Authored by: Suzan Last Provided by: Pressbooks. Located at: https://pressbooks.bccampus.ca/technicalwriting/chapter/writing-processes/#retfig1.5.1 License: CC BY 4.0
- Writing Strategies in EDUC 1300. Provided by: Lumen Learning. Located at: https://courses.lumenlearning.com/sanjacinto-learningframework/chapter/writing-strategies/. License: CC BY 4.0
ALL RIGHTS RESERVED CONTENT
- UNC The Writing Center Handouts. Located at: http://writingcenter.unc.edu/handouts/. License: All Rights Reserved
- Purdue Online Writing Lab. Located at: https://owl.english.purdue.edu/owl/resource/747/01/. License: All Rights Reserved
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oercommons
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2025-03-18T00:36:46.773115
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https://oercommons.org/courseware/lesson/66347/overview
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State Government Spending in Texas
Overview
State Government Spending in Texas
Learning Objective
By the end of this section, you will be able to:
- Discuss state government spending in Texas
Introduction
This section explores in a broad sense where Texas spends its revenue.
Where Does Texas Spend its Money?
In economics and political science, fiscal policy is the use of government revenue collection (mainly taxes) and expenditure (spending) to influence the economy.
While the U.S. Government has the power to borrow money - even for operating expenses, the state government of Texas cannot. The Texas Constitution requires that Texas operate under a balanced budget. The state may only spend as much as it estimates it will receive in revenue during any fiscal biennium.
The state government in Texas has budgeted to spend $251 billion over the 2020-21 biennial budget cycle, a significant increase over the $217 billion budget for the previous two-year cycle. Lawmakers agreed to increase spending by $11.1 billion on public education and to offset mandated local property tax cuts.
In Figure 13.2, above, note that public education is the state’s single largest spending category, followed closely by health and human services. While most of the health care portion of the budget is paid with federal funds, nearly every public education dollar must be raised locally through state taxes.
Key budget items for Texas include the foundation school program, which covers the state’s share of public K-12 education, Medicaid and Medicare, Child Protective Services, transportation, mental health, higher education criminal justice, border security, teacher retirement and health benefits, and state employee retirement.
Texas' 2020-21 budget includes significant increases in spending from the previous budget. An optimistic revenue forecast from State Comptroller Glen Hegar allowed legislators to spend 16% more than in budget approved by the House and Senate in 2017.
Much of the additional spending went to the Republican leadership's two top legislative priorities - public education and property tax reduction. The $94.5 billion allocated to education includes colleges and universities as well as K-12 public schools - an overall 10% increase in education spending from the previous budget cycle.
Meanwhile, the $84 billion appropriation for health and human services programs increased only 1% from the previous budget, with Medicaid receiving a $900 million cut - mostly in federal funding.
While governors generally use their line-item veto power to trim at least a few programs, Governor Greg Abbott approved the budget adopted by Representatives and Senators without a single line-item veto—the first time a Texas governor has approved an entire state budget since Governor Allan Shivers signed a budget without changes in 1955.
References and Further Reading
Senate Research Center (2019, January). Budget 101: A Guide to the Budget Process in Texas
Cameron, D. & Walters, E. (2019, May 31). From property taxes to teacher pay, here's how the Texas Legislature handled spending priorities. The Texas Tribune. Retrieved October 23, 2019.
Legislative Reference Library (n.d.). Legislation. Retrieved October 23, 2019.
Roldan, R. (2019, June).Texas Gov. Greg Abbott signs $250 billion budget with no line-item vetoes. The Texas Tribune. Retrieved October 23, 2019.
Licensing and Attribution
CC LICENSED CONTENT, ORIGINAL
State Government Spending in Texas. Authored by: Andrew Teas. License: CC BY: Attribution
Fiscal Policy. Authored by: Kris S. Seago. License: CC BY: Attribution
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oercommons
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2025-03-18T00:36:46.797689
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05/05/2020
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"author": "Kris Seago"
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https://oercommons.org/courseware/lesson/66350/overview
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Glossary
Overview
Glossary
Glossary: Fiscal Policy in Texas
ad valorem taxes: taxes that multiply the appraised value of a property by a tax rate set by the governing body of the local government.
appropriations: authorization by the legislature to a government agency or body to spend up to a particular amount of money
Biennial Revenue Estimate (BRE): a detailed forecast of the revenue that the state is expected to take in over the next biennium that is prepared by the comptroller's office
debt: the total amount the government owes across all years
deficit: the annual amount by which expenditures are greater than revenues
discretionary spending: government spending that Congress must pass legislation to authorize each year
excise taxes: taxes applied to specific goods or services as a source of revenue
fiscal policy: the use of government revenue collection (mainly taxes) and expenditure (spending) to influence the economy
mandatory spending: government spending earmarked for entitlement programs guaranteeing support to those who meet certain qualifications
progressive tax: a tax that tends to increase the effective tax rate as the wealth or income of the tax payer increases
regressive tax: a tax applied at a lower overall rate as individuals’ income rises, thus, the tax burden falls more heavily on lower-income individuals
severance taxes: taxes imposed on the removal of natural resources within a taxing jurisdiction, which are most commonly imposed in oil-producing states within the United States; resources that typically incur severance taxes when extracted include oil, natural gas, coal, uranium, and timber
strategic plan: a plan that includes 1) a mission statement, 2) a statement about the goals of the agency, 3) a discussion of the population served by the agency, 4) an explanation of the means that will be used to achieve these goals, and 5) identification of the measures to be used to assess the agency's success in meeting these goals
Licenses and Attribution
CC LICENSED CONTENT, ORIGINAL
Fiscal Policy in Texas: Glossary. Authored by: Andrew Teas. License: CC BY: Attribution
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oercommons
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2025-03-18T00:36:46.814827
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05/05/2020
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"title": "Texas Government 2.0, Financing State Government, Glossary",
"author": "Kris Seago"
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https://oercommons.org/courseware/lesson/79260/overview
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Learning Activities
Activity 10.1
Identifying Your Values
Using the values below, pick at least four values that mean the most to you. List these four values along the left/numbered side of the table below. Then think about at least 1-3 occupations of interest and list them in the boxes underneath the Possible Career Options section. Next, spend time reflecting on how each value corresponds to each career option, assigning a number from 3 to -1 to indicate the level of congruence. This will be an excellent exercise to return to after going through the Understanding Career Options section, as it will provide you with tools to research tangible evidence of values in action.
Common Career Values | |
Practicality | Originality |
Beauty | Service to Others |
Stability | Independence |
Efficiency | Tradition |
Generosity | Influence |
Competition | Risk Taking |
Status | Imagination |
Learning | Accuracy |
Curiosity | Cooperation |
Common Sense | Leadership |
Career Options Worksheet
Attributions
Career Values Worksheet, by Richard Knowdell at KnowdellCardSorts.Com. Reused with permission.
Activity 10.2
Reflect on Your Career Opportunities
Attached to this section is a handout based on Central New Mexico Community College’s career development handout but with a few adaptations. Follow the instructions on the first page to guide you in completing this assignment. Ideally, you will use the Wish List/Deal Breakers page along with information from the O*NET profiler and your career research to refine this list. The goal of this assignment is to provide you with a guided way to think about how they relate to career opportunities.
Attributions
Adapted Career Handout of original by Central New Mexico Community College, located at https://www.cnm.edu/student-resources/connect-services/career-exploration. Modified by Sarah Hagler and Cory McGregory. Reused with permission.
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oercommons
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2025-03-18T00:36:46.847436
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Heather F. Adair
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"url": "https://oercommons.org/courseware/lesson/79260/overview",
"title": "Foundations for College Success, Career Exploration, Learning Activities",
"author": "Forrest Lane"
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https://oercommons.org/courseware/lesson/87978/overview
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Protecting Humanity after World War I: Successes and Failures
Overview
The First International War Crimes Trials: Leipzig 1921
The first international war crimes trials, the Leipzig Trials, held in 1921, established an example of how not to conduct a trial against alleged war criminals. Throughout the spring and summer of 1921, Germans charged as war criminals, for their actions in the First World War, were tried and sentenced by Germans in the country’s highest court: the Criminal Senate of the Imperial Court of Justice at Leipzig. Shock at the apparently “light” sentences of the war criminals provoked an outraged response throughout Great Britain, Belgium, and France, who presented charges against Germany. Their expressed resentment for the trials spread across Europe and the United States. The outcome of the trials and their flaws emerged from German partiality and concern for national interest. However, the vying agendas amongst the Allies, the complete lack of guidance for the trials under international law, and the instability of the fragile Weimar Republic allowed for the peculiar structure and conduct of the trials.
Learning Objectives
- Analyze the immediate and long-term goals of the Leipzig Trials.
- Analyzes the successes and failures of the Leipzig Trials.
Key Terms / Key Concepts
Imperial Court of Justice at Leipzig: Germany’s highest court in 1921
Leipzig Trials: held in Germany in 1921, the first international war crimes trials
Preparing for the First International War Crimes Trials
After WWI, the Allies had called for war crimes trials against the Germans since 1914. However, creating an agreed-upon course of action for the trials caused incessant conflict between the Allies because neither the phrase “war crimes” nor “war criminals” appeared in the 1907 Hague Convention, which governed international law during the First World War. The British first employed the phrases in conjunction with the German occupation and exploitation of neutral Belgium in 1914.
As the war progressed, the focus of British clamor for war trials shifted away from German actions in Belgium to German “atrocities” of mistreatment toward British prisoners of war and unrestricted submarine warfare. These two concerns dominated British charges during postwar discussion of war crimes trials. The French expressed similar charges against German mistreatment of French prisoners of war, particularly in conjunction with the killing of surrendered and wounded prisoners of war. Belgium, the site of severe exploitation and violent mistreatment by the Germans during the war, had a much weaker voice in the dialogue on the war crimes trials, but charged the Germans of committing heinous atrocities against Belgian citizens. Woodrow Wilson, skeptical about the other countries’ agendas in the pursuit of the trials, called for a lenient course of action regarding the trials. However, the four countries agreed on the point that Germany should gather evidence against its own citizens charged as war criminals and present the evidence and the accused persons to the Allies, in accordance with the Treaty of Versailles; these accused would then be tried by an international tribunal. In result, the trials were postponed and United States withdrew from the proceedings.
The Weimar Republic during the Trials
In 1921, the brittle government of the Weimar Republic was caught in a vise as international pressure and domestic strife collided over the pending trials of the first war crime trials. Compliance with Allied demands, the German government argued, would threaten their fragile new republic. Over the course of the war, the bulk of Germany’s resources had been devoted to the war effort. Exhaustion of resources compounded by the loss of more than two million soldiers, demobilization, inflation, and political discontent from both far-leftist and rightist parties, rendered the German Republic an extremely fragile state. The immediate postwar period did not encourage German support for the war crimes trials or the new government. Recognizing the difficulty of their position, the German government’s approach to the war crime trials resulted in a carefully balanced act of attempted appeasement of both Allied and German demands.
As a solution, German Secretary of Finance, Matthias Erzberger led a motion to try German war criminals in Germany’s highest civilian court—Criminal Senate of the Imperial Court of Justice at Leipzig. In an effort to secure support from the Allies, the German proposal asserted that a German committee would investigate Germans charged as war criminals. The proposal also allowed for delegations from each of the prosecuting nations to be present at the trials.
The Leipzig Trials Begin
In the spring of 1921, the Germans assembled eight cases to be tried: four British cases, three French cases, and one Belgian case. These first eight cases comprised the Leipzig Trials. Aware of Allied claims that the Germans systematically violated international law, the court made a concerted effort to appear objective during the proceedings, but from the beginning of the trials in May 1921, German national interest governed the actions of the German court.
The British Cases
The Germans had a vested interest in appeasing British interests. After the war, Great Britain supported German interests during the Upper Silesian Crisis where Polish Silesians revolted against German rule in Western Silesia. Britain also supported the proposition to hold the trials in Germany.
In return, the Germans pursued the trial of the U-86 submarine crew, after the British abandoned the case. Helmut Patzig, commander of U-86, torpedoed the British hospital ship, Llandovery Castle, on June 27, 1918, and subsequently fired on the lifeboats carrying survivors. Sought after heavily by both the British and German governments following the war for violating multiple clauses within The Hague Convention, Patzig avoided capture and presumably returned to his home in Danzig. Under the Treaty of Versailles, German authorities could not apprehend him there. The British government had clamored for Patzig’s trial, but when it was determined that he could not be found, the British dropped the case. The German government did not. Under the Schücking Committee and against immense protest from the German public, the court brought to trial two of Patzig’s crew members: Johann Boldt and Ludwig Dithmar. The trial ended with the Court issuing both Boldt and Dithmar a four-year prison sentence. Dithmar received his discharge from the navy and Boldt lost the privilege of wearing his uniform. Perceived by the Allies as a light sentence, Claud Mullins—British delegate to the trials—explained the sentence carried significantly more weight in Germany. Free of the constraints of international law, the German court conducted the trials according to German law. Under German law, the military was judged according to laws specifically designated for military cases, separating it from the laws of German civilians. The trial of Boldt and Dithmar demonstrated the complexities in trying members of the military. Although it resulted in the demotion of their statuses, it did little else to men charged with committing wartime atrocities.
The Belgian Case
In contrast to the British cases, the Germans handled the French and Belgian cases with considerably less care and objectivity. Belgium’s only case at Leipzig was the case against Max Ramdohr. He was accused of severe cruelty toward Belgian youths who had “sabotaged” the German railroad line in Grammont. Dozens of young, male Belgian boys between the ages of twelve and eighteen testified that Ramdohr had imprisoned them in poor conditions and interrogated them by plunging their heads into buckets of ice water. A thirteen-year-old testified that Ramdohr had wrapped a string around his neck, then connected the string to a hook above his head and beat his bare legs with a cane. The Leipzig Court listened to the extensive testimonies against Ramdohr, but unlike the British cases, did not consider the evidence presented as legitimate because almost all of the evidence presented against Ramdohr rested on the testimonies of young boys. This German court did not take the evidence seriously because the trial was of a member of the German military, and evidence presented against him came from civilians. The court further argued that the age of the witnesses, and the fact that three years had passed since the events, the Belgian government could easily have swayed their witnesses to have false memories of the events. Based on these assertions, Ramdohr was acquitted.
The French Cases
Following Ramdohr’s acquittal, the French presented their long-awaited trial of Lieutenant-General Karl Stenger and his subordinate officer Major Benno Crusius. In August 1914, upon entering a French village, Stenger reportedly gave the order to the 58th Infantry Brigade to kill all of the wounded French soldiers and prisoners of war. Upon receiving word of this order, Crusius executed many French prisoners of war. Evidence produced by both German and French witnesses convinced the court that prisoners were executed during two separate incidents in 1914.
The trial did not proceed in the way anticipated by the French. On the day of the trial, Stenger appeared in court supported by two crutches, having lost his right leg in the course of the war. His uniform was bedecked in medals, most prominent of which was the Pour le Mérite. For the Germans, Stenger still embodied the quintessential war hero. His appearance emphasized the credibility of his testimony. Stenger calmly denied the charge that he had issued such an order, and the only prisoners who were shot were those who continued to fight. Improbable as the story was, it justified Stenger’s actions in the eyes of the court.
Soon thereafter, the trial shifted its focus to the actions of Stenger’s subordinate officer, Major Crusius. At the end of the trial, the court asserted that Crusius acted out of a misconstrued order from Stenger. However, Crusius could not be held entirely responsible for his actions because German doctors had determined he was “insane” at the time of the incident, and likewise, the court shared that opinion. The trial ended with Stenger’s acquittal and Crusius lost the right to wear his uniform and received a sentence of two years in prison, of which he had already served fourteen months.
The verdict outraged the French, who called for first called for Stenger’s trial in 1914. In their eyes, Stenger and Crusius had violated the “laws of war and humanity” many times in the execution of the French prisoners. French Prime Minister Alstrid Briand reacted immediately by ordering a withdrawal of the French delegation from the trials. The French government further stated French troops would continue to occupy the Rhine until “justice” was delivered at Leipzig. Both assertions were poor political maneuvers. Premier Briand’s decision to order the delegation to depart from the trials deeply offended the German court, particularly Statspräsident Heinrich Schmidt, whom the British delegation frequently praised as impartial based on his handling of the trials. With their departure, the French government blatantly accused the Leipzig judges of partiality and followed up this maneuver with a threat to the Germans that French troops would continue to occupy the Rhine. Their threat did nothing more than antagonize the Germans, and support the German idea of an unfair Treaty of Versailles
Evaluating the Leipzig Trials presents several challenges. Both the news reports of the era and historians discuss the “failures” of the trials and often overlook its accomplishments. The blatant partiality of the Germans during the cases was clearly displayed by the fact that of the British cases in which six men were tried, five received sentences. The French and Belgian cases tried six men as well, only one of whom received a prison sentence.
However, the flaws of the trials should not entirely overshadow the events of the first international war crimes trial. The Allies exhibited significant cooperation in their pursuit of administering punishment for war criminals, in spite of their vying agendas. Germany also, demonstrated cooperation with the Allies, during the years prior to and during the trials. While the trials were a failure in legal terms, they marked a significant step in the international attempt to protect international law and punish persons who violated the laws of war and humanity in times of war and, during the revision of international law at the Geneva Convention of 1929, influenced the development of protective clauses concerning prisoners of war and captured troops.
Ignored War Crimes: Serbia and the Armenian Genocide
The 1921 Leipzig Trials were of mixed success. One of their chief failures came not from the German high court, but from the Allies themselves. Wrapped in their respective, post-war misery, England, France, and Belgium focused only on crimes that had occurred against their people. The United States was largely left out of the proceedings. And as a result, no one from the international community that oversaw the first war crimes trials looked at war crimes beyond the Western Front. None of the countries pressed for international war crimes trials to be held for actions that had occurred on the Eastern, Middle Eastern, or African fronts during World War I. As a result, the perpetrators not only “got away” with the war crimes committed in these areas, but the trials set an early precedent for prosecuting only war crimes that were committed against Western powers, ignoring those committed against other nations and peoples. Such was the case for the greatest crime of World War, the Armenian Genocide, as well as numerous others in Serbia and Africa.
Learning Objectives
- Understand the events and importance of the Armenian Genocide.
- Evaluate the significance of “ignore war crimes” of World War I.
Key Terms / Key Concepts
Armenians: ethnic, Christian minority group living in Turkey during World War I
Armenian Genocide: mass murder of Armenian people in 1915 – 1917 by the Young Turks
Rodolphe Archibald Reiss: internationally renowned criminologist who investigated Austro-Hungarian war crimes committed in Serbia in World War I
Talaat Pasha: minister of the interior of the Ottoman Empire during World War I; a figure central to the plan of Armenians eradication
Three Pashas: three central government figures in the Young Turks: Talaat Pasha (minister of the interior), Enver Pasha (minister of war), and Djemal Pasha (minister of the navy)
War crimes against Serbia: mass murder against Serbian people carried out by the Austro-Hungarian forces in World War I
Young Turks: hyper-nationalist group who came to power in Turkey through a coup in 1908 and were instrumental in the destruction of the Armenians
War Crimes against Serbia
In early 1915, the Serbian Relief Fund—a London-based organization—beseeched British citizens to help save the Serbian people from extinction. The organization’s pamphlet, Serbia’s Cup of Sorrow, passionately exposed the dire situation the Serbian people faced because of the Austro-Hungarian army’s violent invasion of the country. The fiery language invoked imagery of the Austro-Hungarian army descending upon Serbia as the four horsemen of the apocalypse, bringing with them the war, famine, disease, and death which now “stalked” the Serbian countryside. Interspersed between accounts of starvation and illness, colorful accounts and illustrations of the army’s pre-meditated intentions to eradicate Serbia’s innocent civilians proliferated throughout the sixteen-page document. By the end of the war, nearly two hundred ads for the Serbian Relief Fund had appeared in England’s The Times. The enormous swell of support arose because of Austria-Hungary’s repeated invasions and subsequent occupation of Serbia in 1916. To galvanize support for their small but strategically important ally in the Balkans, the British organized domestic and foreign relief agencies. Serbia’s desperate plight also attracted support from Russia, France, and the United States. And then, within a year of the war’s conclusion, the Allies’ attitude toward Serbia underwent a radical shift.
The Austro-Hungarian army waged a particularly brutal invasion in order to suppress the Serbians. The army invasion proved shockingly brutal not only because of the ruthless tactics employed but also because of the scope and concentration of the violence. Over the course of thirteen days, the Austro-Hungarian army advanced only twenty miles into Serbia before being repulsed by Serbian forces. However, in that narrow period of time the army reportedly torched villages and brutally murdered between 3,500 and 4,000 Serbian civilians. Collectively, the murders are referred to as the War crimes against Serbia.
Internationally renowned criminologist Rodolphe Archibald Reiss investigated this account of the massacre at the Serbian village Chabatz, where he uncovered a mass grave. He found the remains of over eighty corpses of varying ages protruding from earth. Many of the victims’ hands were still bound with rope, while tattered clothing still hung from others. The evidence unearthed at the site supported a deposition given by an Austrian corporal who witnessed the mass execution.
In 1916, the British published a second edition of Reiss’s investigations. Reiss lengthened his work substantially by adding considerably more first-hand accounts and depositions testimonies than were included in the first edition, but little difference existed in the subjects of the two editions. At the time, stirring accounts of the Austro-Hungarian army’s torture of Serbian civilians and destruction of property also proliferated throughout British newspapers.
Aftermath of the War Crimes in Serbia
For over two years, the Allies tried to negotiate the prosecution of alleged “war criminals” before an international military tribunal. Over the course of their negotiations, however, the Allied concern for the victims of war crimes committed outside of Western Europe faded and their anxiety regarding Eastern Europe increased. The committees of the Big Four not only ignored the requests of the Yugoslavian delegation, but almost entirely excluded them from discussions. The postwar perception of the region as a turbulent, war-mongering zone directly influenced the course of action taken by the framers of the international war crimes trials. Their hesitancy conveyed a critical message about the Balkans: the experiences of the Balkan Wars and World War I cemented Western notions that Serbia and the Balkans posed a significant danger to Europe. Thus, the Austrian and Hungarian perpetrators of war crimes in Serbia were never tried for their wartime atrocities.
The Armenian Genocide
The Armenians were an ethnic, Christian minority group who historically had lived in present-day Turkey and Armenia for centuries. In the period of the late 1800s and early 1900s, Turkey and Armenia were part of the Ottoman Empire—an empire governed by Muslim Turks. Although the Armenians had strong communities throughout the Ottoman Empire, tension existed between them and the Turks. Armenians were discriminated against, and violence erupted between the two sides in the late 1800s. Of all the atrocities and crimes committed in World War I, none remains as harrowing as the Armenian Genocide.
The Young Turks
In 1908, a revolutionary group came to power in the Ottoman Empire through a coup d’état—the Young Turks. The group was extremely nationalist and believed in a “Turkish state for the Turks.” Within a year, violence again erupted between the Turks and the Armenians during an attempted countercoup. Overnight, the Young Turks had branded the Armenians as an “internal enemy” and a scapegoat for the violence and discontent spreading throughout the empire. The Turks outnumbered and outgunned their opponents, and the Armenians suffered extensively. By the end of 1909, over 20,000 Armenians were killed.
Little attention from other countries was afforded to the mass killings of the Armenians, a point which the Young Turks undoubtedly noticed. The lack of response by anyone with the power to do something established a precedent in the Ottoman Empire; this conveyed the message that it was possible to slaughter people systematically and there would be no repercussions.
Over the succeeding five to six years, the Young Turks became increasingly nationalist and authoritative. They introduced three radical nationalist leaders into their government, who became collectively known as the Three Pashas. These men, aided by their supporters, would lay the groundwork for the Armenian Genocide.
World War I and the Armenian Genocide
War provides cover for some of the most heinous human actions because it distracts government and civilian view toward the bigger problems and pictures at hand. In much the same way that Adolf Hitler’s war of extermination against the Jews would take place during the height of World War II, the Turkish government would use the cover of World War I to shield foreign eyes from the fact that they were systematically exterminating the Armenians in their country.
In 1914, the Ottoman Empire entered World War I on the side of Germany and Austria-Hungary. This immediately pitted it against Russia—their neighbor to the northeast. Despite some initial success on the Eastern Front, the Ottoman Empire quickly experienced setbacks. To account for the floundering Turkish war effort, the government asserted that the Armenians were betraying them from within. Their argument claimed that the Armenians, as Christians, were not only anti-Turkish, but pro-Russia, which was also a Christian nation.
In April 1915, the Turkish government began the systematic destruction of the Armenians. Thousands of Armenians were rounded up in Constantinople, which was the capitol at the time. Armenians were similarly rounded-up throughout the Ottoman Empire; their businesses and homes were seized or destroyed. The men were generally shot on site. While the women, children, and elderly were meant to be deported. Although the Turkish government spoke of “deporting” Armenians, the reality was far grislier. Women, children, and elderly people were forced on long death marches with scarcely any supplied little clothing, food, or water—toward the deserts of Syria and Iraq. They were poorly guarded and crossed through regions where they were attacked, raped, and murdered. Very few of the Armenians on these marches survived. Those who did arrive in Syria and Iraq only to find that they were not welcome. Often, they were shot upon arrival.
Evidence of the Armenian Genocide
The Armenian Genocide was the attempted destruction of a race of people by the Turkish government and military from 1915 to 1917, and sporadically until 1923. And yet, more than a century later, the Turkish government denies that the destruction of the Armenians was a “genocide.” However,evidence does exist of this war crime.
Central to the evidence of the Armenian Genocide is the fact that there is surviving records from the government of Talaat Pasha—The Young Turk’s minister of the Interior during the war—that shows his overt planning for the execution of the Armenians. In one correspondence with Henry Morgenthau—U.S. Ambassador to the Ottoman Empire, Pasha presented Morgenthau with an “astonishing request”:
I wish you would get the American life insurance companies to give us [The Turkish government] a list of their Armenian policy holders. They are practically dead now and have left no heirs to collect money. The government is the beneficiary now. Will you do so?
Henry Morgenthau refused the request. He later recorded Talaat Pasha’s boast to friends.
I have accomplished more toward solving the Armenian problem in three months than Abdul Hamid [last sultan of the Ottoman Empire] accomplished in thirty years!
Turkish letters recounted the brutal extermination of the Armenians. One soldier reported how during his appointment to a quarter of Turkey he witnessed the arrival of the Armenians. Men, women, and children were separated. The men were taken out of town in small groups and shot. They were later buried in mass graves. Women and children were “deported” and attacked by organized groups of bandits who raped, robbed, and murdered bands of Armenians walking through the desert. He later reported seeing masses of Armenian corpses beside the roadways.
Although very few Germans participated in the killing of the Armenians, many witnessed the events as bystanders.Because of Germany’s alliance with the Ottoman Empire, the two governments were closely aligned. Since before the war, German military advisors had been stationed in Turkey, and worked closely with the Turkish military. During the Armenian Genocide, German officers watched from the sidelines as the Turkish government engaged in the destruction of the Armenians. Surviving testimony demonstrates the role of Germans during the genocide. German Lieutenant Commander von Humann wrote,“Because of their conspiracy with the Russians, the Armenians are being more or less annihilated. That is hard, but it is useful.”
The Germans were not the only Europeans to witness the Armenian Genocide. Russian soldiers also saw the massacre of the Armenians. Upon their arrival into such villages of eastern Turkey as Mush, they found mass graves of Armenians shot on the outskirts of town.
Aftermath
The Armenian people lost their homes, property, and lives. In the aftermath of World War I, the Young Turks had proved enormously successful in their goal to “Turkify” the Turkish state. At least 800,000 Armenians were dead. Perhaps more than one million.
In 1939, just before the start of World War II, Hitler would rally his troops for the destruction of Poland by declaring, “Who today still remembers the annihilation of the Armenians?” In so doing, he assured his troops that whatever methods of destruction were employed against the Poles, it would ultimately be ignored by the Western nations. Afterall, the West had ignored the slaughter of the Armenians, and never pursued the perpetrators. This choice on the part of the Allies signaled to Hitler that the West would allow brutal warfare to take place anywhere outside of Western Europe or the United States because it did not directly affect them or their important allies.
The Allies Choose Inaction
The Allies were well-aware of the persecution of the Armenians. To their credit, Britain, France, and Russia openly denounced the crime as violating “laws of humanity” during the war. After the war, Britain called for prosecution of the perpetrators of the Armenian Genocide. However, their calls fell short. European countries, especially France, were struggling to rebuild following the war; their primary goal was to hold the people who had destroyed French lives and property accountable for their actions. Likewise, the British public failed to rally behind the calls to prosecute Turkish war criminals. In the eyes of many Western Europeans, the issue of Ottoman war crimes should be handled by the Turks themselves, rather than an international tribunal. After all, World War I resulted in the dissolution of the Ottoman Empire; therefore, it no longer posed a threat to Western Europe or their immediate interests.
To the credit of the post-war Turkish government, they did hold trials for the perpetrators of the Armenian Genocide. Eighteen perpetrators, including the Three Pashas, were tried. Of the eighteen, only three were executed, and the rest were acquitted. Talaat Pasha was assassinated while in Berlin in 1921 as part of a covert, Turkish mission to execute perpetrators of the Armenian Genocide. His killer was later acquitted.
Legacy
The Allies—Britain, France, and the United States—headed the effort to hold war criminals responsible for their actions following World War I. Their efforts successfully led to the idea of an international tribunal that would hold individuals responsible for their wartime atrocities. However, putting the idea of such trials into practice proved far more difficult. Not only did the idea of war crimes trials prove logistically difficult, the Allies themselves also focused only on war crimes committed against their people and their immediate allies. As a result, the most heinous of all war crimes committed in World War I went largely unchecked and unpunished by the international community. Inaction set a dangerous precedent that, in essence, established that war crimes carried out in places outside of Western Europe could be ignored.
International Law Revised: Geneva 1929
The brutality inflicted on humans, particularly civilians, during World War I prompted the international community to try protecting humans during future conflict. Led by Great Britain, France, and the United States, the global community was, in fact, a Western community that focused on the restructuring of international law, as well as the prosecution of war criminals before an international court. Most of all, there was a concerted effort to protect human beings, especially civilians and prisoners of war, in future wars.
Learning Objectives
- Understand the significance of, and the reasons for, the passage of the Third Geneva Convention.
Key Terms / Key Concepts
Third Geneva Convention: 1929 passage of revised international laws protecting prisoners of war
International Law and Warfare
When World War I erupted, all major belligerent nations had pledged to abide by the rules of warfare prescribed by two sets of international laws: the 1907 Hague Convention, which explained the rules of warfare with regards to prisoners of war and use of weaponry; and the 1906 Geneva Convention that prescribed the rules for treating human beings during warfare. The goals of these two sets of international laws were regulating warfare to make it more “humane.” As World War I dragged on, and every single major combatant nation violated the rules of warfare time and again, the result was that World War I became the most violent and expansive war in history. (Twenty years later, World War II would surpass it in scope and violence.)
In 1919, the world reeled from the knowledge that World War I had resulted in 40 million deaths in four and a half years. The figures included military, civilian, and 1918-flu related deaths. Moreover, the international community was astounded by the violence committed against civilians, especially in France and Belgium. And over the course of four and a half years of war, millions of people had become prisoners of war. Of that figure, thousands experienced cruel mistreatment including beatings, neglect, disease, and non-deliberate starvation. It was evident that international law had failed to protect humanity. After World War I, it was evident to lawmakers that international law must be revised.
The Third Geneva Convention
Critically, the international community noted that the Hague Convention—a document whose primary focus was on technology and military operations in warfare—had prescribed the treatment of prisoners of war. Whereas, the Geneva Convention had focused on the treatment of human beings, including the wounded and civilians. By lumping prisoners of war into a convention that focused primarily on technology, the prisoners of war were stripped of their humanity, as well as recognized as a collective, amorphous group, rather than individuals. The mixed success of the 1921 Leipzig War Crimes Trials—which focused largely on the mistreatment of prisoners of war in World War I—demonstrated the essentiality of upholding solid, specific, international laws protecting humanity during wartime.
In 1929, framers of international laws from across the world passed the Third Geneva Convention. This document recognized the status of prisoners of war as human beings with a collective right to humane treatment. Among other provisions, the Third Geneva Convention established rules regarding the diet, housing, hygiene, and medical treatment of prisoners of war. It further established rules for the transfer and release of prisoners, as well as prescribed treatment according to rank, labor, and financial resources.
The chief achievement of the Third Geneva Convention was its acknowledgment that, rather than being “part of the war machine,” prisoners of war were human beings and must be treated as such. Failure to respect the rules regarding humane treatment of prisoners of war would (theoretically) constitute a war crime in future warfare.
Legacy
At the time of its passage, 196 countries ratified the Third Geneva Convention. And from the outside, it looked as though the international community’s pledge to protect humans in future warfare would prove successful. Scarcely anyone could have predicted that, in ten short years, the world would be engaged in a second and far more violent war. A deadly war that would not only violate the Third Geneva Convention, but shatter it as genocides were carried out in Europe and the Far East by Nazi Germany and Imperial Japan. Still, the greatest success of the Third Geneva Convention is the international dedication to protecting humans in warfare. Following World War II, framers of international law would meet again to pass the Fourth Geneva Convention—a document that still serves as the guiding rules of warfare in the 21st century.
Primary Source: 1929 Geneva Convention relative to the Treatment of Prisoners of War
Convention relative to the Treatment of Prisoners of War.
Geneva, 27 July 1929.
“Part 1: General Provisions” [Abridged]
PREAMBLE
Recognizing that, in the extreme event of a war, it will be the duty of every Power, to mitigate as far as possible, the inevitable rigours thereof and to alleviate the condition of prisoners of war;
Being desirous of developing the principles which have inspired the international conventions of The Hague, in particular the Convention concerning the Laws and Customs of War and the Regulations thereunto annexed,
Have resolved to conclude a Convention for that purpose and have appointed as their Plenipotentiaries:
(Here follow the names of Plenipotentiaries)
Who, having communicated their full powers, found in good and due form, have agreed is follows.
PART I : GENERAL PROVISIONS - ART. 1.
LAND;LIMITATION ART:
Article 1. The present Convention shall apply without prejudice to the stipulations of Part VII:
(1) To all persons referred to in Articles 1 [ Link ] , 2 [ Link ] and 3 [ Link ] of the Regulations annexed to the Hague Convention
(IV) of 18 October 1907, concerning the Laws and Customs of War on Land, who are captured by the enemy.
(2) To all persons belonging to the armed forces of belligerents who are captured by the enemy in the course of operations of maritime or aerial war, subject to such exceptions (derogations) as the conditions of such capture render inevitable. Nevertheless these exceptions shall not infringe the fundamental principles of the present Convention; they shall cease from the moment when the captured persons shall have reached a prisoners of war camp.
PART I : GENERAL PROVISIONS - ART. 2.
Art. 2. Prisoners of war are in the power of the hostile Government, but not of the individuals or formation which captured them.
They shall at all times be humanely treated and protected, particularly against acts of violence, from insults and from public curiosity.
Measures of reprisal against them are forbidden.
PART I : GENERAL PROVISIONS - ART. 3.
Art. 3. Prisoners of war are entitled to respect for their persons and honour. Women shall be treated with all consideration due to their sex.
Prisoners retain their full civil capacity.
PART I : GENERAL PROVISIONS - ART. 4.
Art. 4. The detaining Power is required to provide for the maintenance of prisoners of war in its charge.
Differences of treatment between prisoners are permissible only if such differences are based on the military rank, the state of physical or mental health, the professional abilities, or the sex of those who benefit from them.
From International Committee of the Red Cross
Attributions
The Holocaust and other Genocides: History, Representation, Ethics. Ed. Helmut
Walser Smith. Vanderbilt University Press, 2002. 149-178.
Hull, Isabel V. Absolute Destruction: Military Culture and Practices of War in Imperial
Germany. Cornell University, 2005. 266-278.
Crowe, David M. War Crimes, Genocide, and Justice: A Global History. New York:
Palgrave Macmillan, 2014.
Mitrović, Andrej. Serbia’s Great War: 1914-1918. London: Hurst & Company, 2007.
Reiss, Rodolphe Archibald. How Austria-Hungary Waged War in Serbia: Personal
Investigations of a Neutral. Librairie Armand Colin: Paris, 1915.
Reiss, Rodolphe Archibald. Report Upon the Atrocities Committed by the Austro
Hungarian Army during the First Invasion of Serbia. London: Simpkin, Marshall,
Hamilton, Kent & Company, Ltd. 1916.
Vick, Alison, "A Catalyst for the Development of Human Rights: 1914-1929." Virginia Tech. 2013. (Masters Thesis)
"(Geneva) Convention relative to the Treatment of Prisoners of War, 1929." Hosted by: International Committee of the Red Cross.
Treaties, States parties, and Commentaries - Geneva Convention on Prisoners of War, 1929 (icrc.org)
Images courtesy of Wikimedia Commons and of the author, Alison Vick
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oercommons
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2025-03-18T00:36:46.915109
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Neil Greenwood
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"url": "https://oercommons.org/courseware/lesson/87978/overview",
"title": "Statewide Dual Credit World History, The Catastrophe of the Modern Era: 1919-Present CE, Chapter 13: Post WWI, Protecting Humanity after World War I: Successes and Failures",
"author": "Anna McCollum"
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https://oercommons.org/courseware/lesson/87961/overview
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War in the Desert: World War I in the Middle East
Overview
The World War in the Middle East
World War I was a global war fought in most corners of the earth, and the Middle East was no exception. A large and long war raged in the Middle East that involved the Ottoman Empire, the British, the Russians, and independent Arab kingdoms. The war was fought in the Middle East from 1914-1918, throughout present-day Turkey, Jordan, Syria, Egypt, Saudi Arabia, and Palestine. Of the many wars that raged in the Middle East during World War I, none is as famous as the 1916 Arab Revolt, which involved the exploits of British archeologist, T.E. Lawrence.
Learning Objectives
- Examine the significance of the Arab Revolt
Key Terms / Key Concepts
Arab Revolt: revolt against the Ottoman Empire led by the Arab forces from the kingdoms of Hejaz and Transjordan
Emir Faisal: Arab prince who led the Arab Revolt
T.E. Lawrence: British archeologist who orchestrated, and helped lead much of the Arab Revolt
The Arab Revolt
Background
The Ottoman Empire had an extensive military history when World War I erupted. Because of its military pursuits, it had created many enemies, including many in the Middle East. One of the groups who strongly resented the Ottomans were the independent Arab clans, particularly those in present-day Saudi Arabia. For this reason, the Arabs did not side with the Ottomans when World War I began. Instead, they saw the war as an opportunity to break away from their former overlords and aggressors. In 1915, a young archeologist from Great Britain would enter their world—T.E. Lawrence. He had investigated numerous Middle Eastern archeological sites before the war, and learned Arabic, and many Arab customs. For these reasons, he was employed by the British army as an intelligence officer in the Middle East in 1915. Once there, he developed a close friendship with Emir Faisal, prince of the Kingdom of Hejaz in present-day Saudi Arabia.
The Arab Revolt of 1916
On June 5, 1916, the Arab forces under Emir Faisal attacked the Ottoman garrison at Medina, launching the Arab Revolt. For three days, the forces fought against the better-equipped Ottomans. Although they were officially forced to retreat with the Ottomans in pursuit, Arab nationalism ran strong, and the Arab Revolt had just begun. On June 10, the Arabs captured the holy city, Mecca.
Owing to a secret treaty with the Arabs, the British launched a naval bombardment of the Ottoman ports along the Red Sea. When the port cities fell to the British, increased numbers of troops and supplied funneled into the Middle East. Thomas Edward (T.E.) Lawrence became instrumental in liaising between the British and the Arab forces. For the rest of 1916, Lawrence would team with the Arabs in a series of hit and run tactics that included the destruction of Ottoman infrastructure. Of particular importance was the campaign to capture Aqaba, a major port city in present-day Jordan.
With the city captured, Faisal took command of Aqaba and the British sent additional resources and men to bolster the Arabs. The desert, however, was not an easy environment to endure. 400,000 gallons of water per day were required for the British troops and their animals. Disease was rampant, especially dysentery, malaria, syphilis, and typhoid. The heat was scorching, the land remote and unforgiving. Tragically, the easiest and fastest way to send for medical help was by camel. To combat the elements, British troops frequently dressed in Arab robes and sandals or bare feet.
Additional Victories
After the capture of Aqaba, the Arab forces achieved numerous other victories. In 1917, they opened the Palestinian Front, and ultimately captured Gaza. The following year, much of the Hejaz Railroad that the Ottomans had constructed was destroyed by Emir Faisel and his forces. Jerusalem was taken over by the Arabs, and the important city of Damascus fell to the Arabs. After these successive defeats, the Ottomans surrendered in November 1918.
After the World War
The British remained allied with the Arabs throughout the rest of World War I, although the alliance was far from smooth. In 1918, the Arabs imagined they would be rewarded for their efforts in the war by the creation of a national Arab state. They were misled by their European allies, who rejected the idea of a national Arab state. Instead, Britain and France divided much of the Middle East into protectorates of their empires.
Primary Source: Excerpt from, Revolt in the Desert, T. E. Lawrence
T.E. Lawrence's account of a village destroyed by the Turks in Sept., 1918
"The village lay stilly under its slow wreaths of white smoke, as we rode near, on our guard. Some grey heaps seemed to hide in the long grass, embracing the ground in the close way of corpses. We looked away from these, knowing they were dead; but from one a little figure tottered off, as if to escape us. It was a child, three or four years old, whose dirty smock was stained red over one shoulder and side, with blood from a large half-fibrous wound, perhaps a lance thrust, just where neck and body joined.
The child ran a few steps, then stood and cried to us in a tone of astonishing strength (all else being very silent), 'Don't hit me, Baba.' Abd el Aziz, choking out something - this was his village, and she might be of his family - flung himself off his camel, and stumbled, kneeling, in the grass beside the child. His suddenness frightened her, for she threw up her arms and tried to scream; but, instead, dropped in a little heap, while the blood rushed out again over her clothes; then, I think, she died.
We rode past the other bodies of men and women and four more dead babies, looking very soiled in the daylight, towards the village; whose loneliness we now knew meant death and horror. By the outskirts were low mud walls, sheepfolds, and on one something red and white. I looked close and saw the body of a woman folded across it, bottom upwards, nailed there by a saw bayonet whose haft stuck hideously into the air from between her naked legs. About her lay others, perhaps twenty in all, variously killed.
The Zaagi burst into wild peals of laughter, the more desolate for the warm sunshine and clear air of this upland afternoon. I said, 'The best of you bring me the most Turkish dead,' and we turned after the fading enemy, on our way shooting down those who had fallen out by the roadside and came imploring our pity. One wounded Turk, half naked, not able to stand, sat and wept to us. Abdulla turned away his camel's head, but the Zaagi, with curses, crossed his track and whipped three bullets from his automatic through the man's bare chest. The blood came out with his heart beats, throb, throb, throb, slower and slower.
Tallal had seen what we had seen. He gave one moan like a hurt animal; then rode to the upper ground and sat there a while on his mare, shivering and looking fixedly after the Turks. I moved near to speak to him, but Auda caught my rein and stayed me. Very slowly Tallal drew his headcloth about his face; and then he seemed suddenly to take hold of himself, for he dashed his stirrups into the mare's flanks and galloped headlong, bending low and swaying in the saddle, right at the main body of the enemy.
It was a long ride down a gentle slope and across a hollow. We sat there like stone while he rushed forward, the drumming of his hoofs unnaturally loud in our ears, for we had stopped shooting, and the Turks had stopped. Both armies waited for him; and he rocked on in the hushed evening till only a few lengths from the enemy. Then he sat up in the saddle and cried his war cry, 'Tallal, Tallal,' twice in a tremendous shout. Instantly their rifles and machine-guns crashed out, and he and his mare riddled through and through with bullets, fell dead among the lance points.
Auda looked very cold and grim. 'God give him mercy; we will take his price.' He shook his rein and moved slowly after the enemy. We called up the peasants, now drunk with fear and blood, and sent them from this side and that against the retreating column. The old lion of battle waked in Auda's heart, and made him again our natural, inevitable leader. By a skilful turn he drove the Turks into bad ground and split their formation into three parts.
The third part, the smallest, was mostly made up of German and Austrian machine-gunners grouped round three motor cars and a handful of mounted officers or troopers. They fought magnificently and repulsed us time and again despite our hardiness. The Arabs were fighting like devils, the sweat blurring their eyes, dust parching their throats; while the flame of cruelty and revenge which was burning in their bodies so twisted them that their hands could hardly shoot. By my order we took no prisoners, for the only time in our war.'”
From Eyewitness to History http://www.eyewitnesstohistory.com/lawrence.htm
Attributions
Willmott, H.P. World War I. DK Publishing, New York: 2012. 236-241.
Excerpt from, Revolt in the Desert. Lawrence, Thomas Edward, 1927. Hosted by EyeWitnesstoHistory.com.
Lawrence of Arabia, 1918 (eyewitnesstohistory.com)
Images courtesy of Wikimedia Commons
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oercommons
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2025-03-18T00:36:46.947012
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Neil Greenwood
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"title": "Statewide Dual Credit World History, European Imperialism and Crises 1871-1919 CE, Chapter 12: World War I in the West, East, and Colonies, War in the Desert: World War I in the Middle East",
"author": "Anna McCollum"
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https://oercommons.org/courseware/lesson/87938/overview
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Asian Colonization
Overview
The Decline of Imperial China
The Chinese Empire was arguably the largest and wealthiest state in the world in the early 18th century. By the late 19th century, however, the Qing Dynasty was severely weakened, as foreign powers aggressively pressed the Chinese state to cede territory and economic control to them.
Learning Objective
- Analyze the weaknesses of the Qing Dynasty in the 19th century that opened China to foreign influence and aggression.
Key Terms / Key Concepts
Taiping Rebellion: a civil war in China (1850 – 1864) between the established Manchu-led Qing dynasty and the millenarian movement of the Heavenly Kingdom of Peace (It began in the southern province of Guangxi when local officials launched a campaign of persecution against a millenarian sect known as the God Worshipping Society led by Hong Xiuquan, who believed himself the younger brother of Jesus Christ. The war ranks as one of the bloodiest wars in human history, the bloodiest civil war, and the largest conflict of the 19th century.)
Nian Rebellion: an armed uprising in northern China from 1851 to 1868, concurrent with the Taiping Rebellion (1851 – 1864) in South China (The rebellion failed to topple the Qing dynasty but caused the immense economic devastation and loss of life that became one of the major long-term factors in the collapse of the Qing regime in the early 20th century.)
Panthay Rebellion: an 1856 – 1873 rebellion of the Muslim Hui people and other non-Muslim ethnic minorities against the Manchu rulers in southwestern Yunnan Province, China; part of a wave of Hui-led multi-ethnic unrest; began after massacres of Hui perpetrated by the Manchu authorities
Punti-Hakka Clan Wars: the conflict between the Hakka and Punti (Cantonese people) in Guangdong, China, between 1855 and 1867 (The wars were particularly fierce around the Pearl River Delta, especially in Taishan of the Sze Yup counties. They resulted in roughly a million dead with many more fleeing for their lives.)
millenarianism: the belief by a religious, social, or political group or movement in a major impending societal transformation; a concept or theme that exists in many cultures and religions
Dungan Revolt: a mainly ethnic and religious war fought in 19th-century western China, mostly during the reign of the Tongzhi Emperor of the Qing dynasty (r. 1861 – 75); a term that sometimes includes the Panthay Rebellion in Yunnan, which occurred during the same period (The 1862 – 1877 revolt arose over a pricing dispute involving bamboo poles, when a Han merchant selling to a Hui did not receive the amount demanded for the goods.)
Anti-Qing Sentiment
In the mid-19th century, China’s Qing Dynasty suffered a series of natural disasters, economic problems, and defeats at the hands of the Western powers. In particular, the humiliating defeat in 1842 by the British Empire in the First Opium War exposed the increasing weakness of the Imperial government and military. The terms of the treaties that ended the First Opium War undermined the traditional mechanisms of foreign relations and methods of controlled trade practiced by China for centuries. Shortly after the treaties were signed, internal rebellions began to threaten the Chinese state and its foreign trade.
The government, led by ethnic Manchus, was seen by many Han Chinese as ineffective and corrupt. Anti-Manchu sentiments were strongest in southern China among the Hakka community, a Han Chinese subgroup. The Qing dynasty was accused of destroying traditional Han culture by forcing Han to wear their hair in a queue, which was the Manchu style. It was blamed for suppressing Chinese science, causing China to be transformed from the world’s premiere power to a poor, backwards country. In the broadest sense, an anti-Qing activist was anyone who engaged in anti-Manchu direct action. This included people from many mainstream political movements and uprisings that developed throughout the second half of the 19th century.
Taiping Rebellion
While the Taiping Rebellion was not the first mass expression of the anti-Qing sentiment, it turned into a long-lasting civil war that cost millions of lives. In 1837, Hong Xiuquan, a Hakka from a poor mountain village, once again failed the imperial examination, which meant that he could not follow his dream of becoming a scholar-official in the civil service. He returned home, fell sick, and was bedridden for several days, during which he experienced mystical visions. In 1842, after more carefully reading a pamphlet, he had received years before from a Protestant Christian missionary, Hong declared that he now understood that his vision meant that he was the younger brother of Jesus and that he had been sent to rid China of the “devils,” including the corrupt Qing government and Confucian teachings. It was his duty to spread his message and overthrow the Qing dynasty. In 1843, Hong and his followers founded the God Worshiping Society, a movement that combined elements of Christianity, Taoism, Confucianism, and indigenous millenarianism. The movement at first grew by quelling groups of bandits and pirates in southern China in the late 1840s. When the Qing authorities began to suppress the movement, guerrilla warfare and, subsequently, a widespread civil war broke out.
For a decade in the 1850s, the Taiping occupied and fought across much of the mid and lower Yangzi valley, some of the wealthiest and most productive lands in the Qing empire. Hostilities began on January 1, 1851, when the Qing Green Standard Army launched an attack against the God Worshiping Society at the town of Jintian, Guangxi. Hong declared himself the Heavenly King (T'ien Wang) of the Heavenly Kingdom of Peace (or Taiping Heavenly Kingdom), from which the term Taiping has often been applied to the supporters of Hong in the English language. The Taiping nearly managed to capture the Qing capital of Beijing in northwest China with a northern expedition launched in 1853, due to the fact that Qing imperial troops were ineffective in halting Taiping advances because they were focused on a perpetually stalemated siege of Nanjing. In Hunan Province, a local irregular army, called the Xiang Army or Hunan Army, under the personal leadership of Zeng Guofan, became the main armed force fighting for the Qing against the Taiping. Zeng’s Xiang Army gradually turned back the Taiping advance in the western theater of the war.
In 1856, the Taiping were weakened after infighting, following an attempted coup against Hong led by the “East King”, Yang Xiuqing, who was one of five “kings” serving as Hong’s commanders. During this time, the Xiang Army managed to gradually retake much of the Hubei and Jiangxi province. In 1860, the Taiping defeated the imperial forces that had been besieging Nanjing since 1853, eliminating imperial forces from the region and opening the way for a successful invasion of southern Jiangsu and Zhejiang province, the wealthiest region of the Qing Empire. While Taiping forces were preoccupied in Jiangsu, Zeng’s forces moved down the Yangzi River capturing Anqing in 1861.
In 1862, the Xiang Army began directly besieging Nanjing and managed to hold firm despite numerous attempts by the Taiping Army to dislodge them with superior numbers. Hong died in 1864 and Nanjing fell shortly after that. The remains of the Taiping resistance were eventually defeated in 1866.
The Taiping Rebellion was the largest war in China since the Qing conquest in 1644 and ranks as one of the bloodiest wars in human history, as well as the bloodiest civil war and the largest conflict of the 19th century, with estimates of war dead ranging from 20 to 100 million, as well as millions more displaced.
Significance of the Taiping Rebellion
The Taiping Rebellion marked the birth of China as a country among others, rather than the only nation under Heaven. It is one of the early tremors of a Communist earthquake, and the ultimate rise of a dynasty of the people, rather than the conquerors. China had been slowly breaking away from tradition for several hundred years, and the Taipings only widened the rift between modern China and its ancestors. Secret societies, like the Taipings, had existed in China for as long as there were Emperors to oppose. However, the Taipings were perhaps the most successful of any that had gone before them. The scale of the Rebellion was such that it merited complete imperial attention for a time. Not only did the Chinese elite take notice of the Taiping Rebellion, but there were foreigners watching as well. England and Japan waited in the wings as they vied for the key to absolute control of China. The country had ceased to be the sleeping dragon tucked behind the Himalayas and inside their Great Wall.
During the seventeenth and eighteenth centuries Chinese culture began to move away from the traditional beliefs of the past. Western culture and beliefs moved slowly into the foreground in China, especially the Christian doctrine spread by missionaries that found itself at the center of the Taiping ideology. The Chinese were beginning to realize the present glory of the Western nations, which stirred a brief resurgence in traditional thinking. Even radical quasi-Christian movements like the Taiping Rebellion made use of Confucian, Taoist, and Buddhist ideas to develop its tenets.
In the mid-nineteenth century, the unrest moved closer to the surface. Natural disasters in the form of floods, droughts, and famines swept across the entire country. Neglect on the part of the Manchu government not only facilitated the incidents but offered no relief or aid in their aftermath. The defeat of the Manchus by the English during the Opium War heightened the tensions between governed and government even more. The outburst of pro-Chinese thinking prompted an anti-Manchu feeling, especially in the south where Manchu rule had never been strong. While the Manchus had been given credit for China's success in conquest only a century before, they were charged with all of China's problems by the mid-nineteenth century. All of this contributed to the evolution of the T'aip'ing T'ien-Kuo and the end of China as an isolated kingdom.
The Treaty of Nanking of 1842 aided in lowering the status of the Qing dynasty even further. Among the elite of China, an aversion to absolute rule was spreading. Scholars thought that the Manchus had outlived their use after a brief golden age, and that the time had come to place the rule of China in Chinese hands again. The foreign ideas and people who now streamed into China without hindrance were strongly resented. The Emperor Tao Kuang (1821 – 1850) had lost the respect of his people. The Emperor had lost the “Mandate of Heaven”, which was its authority to govern China with divine blessing, and the Chinese people looked for a new dynasty of emperors to rule with this mandate.
The Manchu Dynasty
The Manchu or Qing Dynasty came to power after the Ming. Called in to aid a rebellion that the now-weak Ming dynasty could not control, the Manchus took over Peking in 1644 and turned over the rule of South China to the Chinese generals who had aided in their conquest. There were several main factors which contributed to the longevity of the Manchu state. They maintained an impressive military force, and during the Qing dynasty, China's borders expanded greatly. Nurhachi (1569 – 1626)—the first Manchu Emperor and founder of the dynasty—made a conscious effort to avoid the mistakes made by the Mongols centuries before. He kept the tribal lands of Manchuria as a cultural base and altered the Ming bureaucratic system to admit only Manchu leaders. The highest government office and all important positions were held by Manchus. In this manner, they made use of Chinese ideas but were careful to remain in control of the bureaucracy. However, the administration at the capital city of Peking (Beijing) was a mix of Chinese and Manchu officials, so much so that the Qing came to be called a dyarchy or the “rule of two”.
The problem the Manchus were faced with in China was their preservation as a ruling body despite their obvious minority, (only two percent of the entire population of China was Manchu). To do this they used a combined measure of Legalist and Confucian ideas. The ruling class amassed enormous material resources, which laid down the barrier of wealth. To keep the nobility from becoming corrupt, they instituted a class policy in which every son had to earn his father's rank. They also maintained a distance from the Chinese culture. Intermarriage and trade with the Chinese was illegal. Manchu traditions like the Banner System were preserved, and knowledge of the Manchu language was mandatory. To further the separation, all Chinese men were made to braid their hair in a queue as a token of their submission.
The Opium War and its aftermath had a great influence on the Qing dynasty. The English, when told "Take away your opium, and your missionaries, and you will be welcome" chose to come with both and throw welcome to the wind. The fact that the English had the power in the first place to disregard the Emperor and his ambassadors was a blow to Chinese esteem. Suddenly these little European nations from far away were threatening the traditions and tenements kept by China for thousands of years. Losing the Opium War was the beginning of the end of the Manchu dynasty. Later, one of the Taiping leaders would state
"Each year they [the Manchus] transform tens of millions of China's gold and silver into opium and extract several millions from the fat and marrow of the Chinese people and turn it into rouge and powder ... How could the rich not become poor? How could the poor abide by the law?"
By 1850, years of leadership and comfort had taken their toll on the Qing dynasty—the nobility was indolent and corrupt and the military had become lax. The Emperor Hsien-Feng had not yet completely let go of the government, but he was not viewed as a strong ruler. There were rumors to the effect that the Emperor was ready to abandon China entirely. Hsien-Feng personified the waning of Qing glory: he was weak and ill. The Emperor stayed in Peking but gave all power of government to the Prince of Korchin—Seng-ko-lin-chin—and Yehonala—a favorite concubine with much power.
The Taiping and Secret Societies
Secret Societies, always a factor in Southern China, now rose to prominence. China, who had swept their ideas into back corners for fifty years, was now ready to listen to the radicals. The Taiping rebels secretly encouraged and allied with other groups, including a band called the Triad. On May 18, 1853, Triad members instigated the locals and took over the major shipping port of Amoy. They held onto the port despite imperial assault until November 11, executing all Manchu officials and foreigners during that time. Suddenly, the people of China realized that the Qing was no longer an absolute power. With that act, the Taipings awakened a nation to rebellion.
The leader of the Taipings, Hong Hsiu-Ch'uan, shaped the entire rebellion and thus much of modern China. He was born on January 1, 1814 and lived in the farming community of Fu-yuan-shui in Kwangtan Province, South China. His father Hong Ching-yang was small independent farmer. Because Hong was an exceptionally bright child, his family hoped that he would pass the examinations in Canton and thus become one of the prestigious elite. They, therefore, sent him to school when he was seven, where he did well. In 1827, when Hong was fifteen, he was given his first examination, the preliminary. He passed this but failed the main examination for a sheng-yuan degree, which was the one that would have elevated his class. Hong tried to pass the exam several times until 1843. This incident may have fed his hostility towards the Qing and China's condition. He took an interest in politics and the government after he was converted to Christianity. His translation of the Christian doctrine formed the beliefs and ideology of the Taiping Rebellion.
In 1837, Hong had a revelation which changed his life, career and outlook. At the time he was in Canton for his examinations, where he knew a Protestant missionary. Hong spent two months studying the bible doctrines under the missionary. Some years before, in 1835, Leang-afa—the first protestant Christian in China—had given Hong several papers about religion. Hong had not studied these until he was given a second pamphlet and began to look at them in more depth back at his home village. Hong was struck suddenly by sickness, leaving him unconscious for about four days. He claimed that, during the time he was in a coma, he had been taken up to Heaven to see Jesus, where he was informed that he was the younger brother of Jesus.
For the next ten years, Hong joined Leang-afa as a street preacher. With several close friends, he founded the Society of God Worshippers and remained the head of that organization until the March of 1847, when he returned to Canton to study with Isaachar T. Roberts—who was an American Southern Baptist missionary who had adopted Hong as a special student, initially encouraging his ideas of rebellion. From these studies Hong created his own version of the Christian doctrine. He readily agreed that God was the maker of the universe, which may be because the Chinese could accept God as a father figure because ancestor worship had been a part of their culture for thousands of years. But he never accepted Jesus as a deity, and the entire idea of a Trinity seemed to him to be too similar to Confucian values. Despite the thorough assimilation of Western religious beliefs by the Taiping, their theology was more of a mosaic than a pure Christian sect. There was an innate sense of family in their doctrine, which hearkened back to Confucianism. Their idea, too, of bringing divinity into the reality of everyday life was more a corrupted version of Buddhism than Protestantism. Even their version of the Ten Commandments—called the Ten Heavenly Precepts—differed significantly from the bible. Their religion was a translation of a translation and completely their own creation. Not surprisingly, the missionary Roberts was to later change his mind about Hong, calling him and his fellow revolutionists "coolie kings" who were "crazy and unfit to rule."
Although much of the "borrowing" from their traditional religions may have been subconscious, almost all of the Taiping propaganda and essay writing depended as much on Confucianism as on Christianity. Confucianism had a large influence on the Taiping religion. Hong recognized and incorporated several key Confucian tenets into his doctrine, such as converting the Five Human Relationships of Confucius to The Five Heavenly Relationships of the Taiping. The Classics, too, were a source of Taiping wisdom literature. Mencius, the early Confucian philosopher (4th century BCE) appealed especially to them because of his semi-Christian stress on the inherent goodness of humanity. In fact, the only point that the Taipings went directly against traditional religions was the role of women in society. The Taipings included women as commanders of forces, and several famous woman bandits played key roles in the rebellion as well.
The Taipings thought that they were the chosen people of their god, with a mission to overthrow the wicked Manchu regime. Because they were a part of the Kingdom of Heaven, they believed the Manchus to be thieving usurpers and therefore incapable of a legitimate claim to the government. The goal of the Taipings from the start had been to take Nanking, and to spread their rule throughout the entirety of China. Though severely factionalized and having changed leaders several times, they managed to install a Taiping government in Nanking, stressing egalitarian values and claiming to be in the process of restoring China's glory. The Taipings formed a kingdom indeed, selecting kings on the basis of their purity and devotion. For instance, Yang Hsiu-ch'ing had previously been a charcoal seller, but he was chosen to be the Eastern King and later head of the entire rebellion.
The Taipings as a fighting force were formidable but rather less than coherent. Their style was to collect an army as they went, inciting the populous to rebellion. Their first military success was the capture of Hupeh, after being held in the city of Yung-an by the Emperor's militia. They attempted in that same campaign to seize Kwangsi and Hunan but failed to hold either. This initial success was balanced by severe defeats at the hands of the imperial forces at sea, where the Emperor had far better material resources. Their battle record was inconsistent, with spurts of inspired fighting and long periods of relative inertia.
By 1863 the Taiping Rebellion was falling apart. Holding the city of Nanking against imperial and foreign forces had become virtually impossible. Sometime in the June of 1862, the Hunan army was preparing to launch their final attack. Hung Jen-kan—the third and final leader of the Rebellion—had attempted during his rule to reevaluate the tenets and beliefs of the Taipings, as well as salvage the Taiping cause. This was not to be the case. Their dream of moving beyond Nanking seemed to be lost.
Nanking fell to the army of Tseng Kuo-ch'uan on July 19th, 1864. The Taiping kings and leaders had planned an organized breakthrough, but the walls fell too suddenly for many to escape. Hong Hsiu-ch'uan had died in Nanking a month before, on June 1. His son was taken out of the city in the band of escapees and named the new Heavenly King or T’ien Wang. Every Taiping found by the Hunan army who did not renounce their faith and surrender was killed. The brother of the conquering general, Tseng Kuo-fan, wrote a report on the condition of Nanking after its siege. The report illustrates the intensity of Taipings even in the face of utter defeat:
"Others searched the city for any rebels they could not find, and in three days killed over 100,000 men. The Ch'in-huai creek was filled with bodies ... Not one of the 100,000 rebels in Nanking surrendered themselves when the city was taken but in many cases gathered together and burned themselves and passed away without repentance."
The initial response of the Manchus to the Taiping Rebellion was fairly straightforward. "Hong Hsiu-chuan's head, with that of the Ch'en-Huan, hung over a Peking gateway until it rotted, and so ended the lesson." However, there were far more aftershocks to come. The Manchu government, weak from a "debauched" emperor and the Opium War, could ultimately not withstand such a severe earthquake as the Taiping Rebellion.
Long Term Effects of the Rebellion
Although a technical failure, the Taiping Rebellion changed the way the Chinese government functioned. The devastation and loss of life in the Yangtze Valley left the once-fertile area a desert for the next hundred years. The Land Tax which the Qing leaned upon so heavily was simply no longer a source of any money at all. Soon, the Manchus were relying solely on the Maritime customs taken in by non-Chinese port operators, as well as on the sale of offices in the administration. The examination system fell into serious neglect and eventually passed away altogether. Now, the main way to advance in class was to buy into political rank. Province leaders and generals assumed a greater power than the central bureaucracy, because the Emperor had bestowed power upon warlords to raise a large enough army. Most of these armies remained under private command rather than returning to the Emperor, and the entire society became factionalized as a result.
When the Qing dynasty fell in the early 1900s, it left a power vacuum. Foreign influence reached new heights, as the merchants and traders that had been so much a part of the late Manchu dynasty poured into China. Japan swiftly became the dominant power in the country. The Chinese economy in every respect increasingly became a subsidy of Japan, especially North and Northeast China. China was pushed into the modern world by force. Soon Japan began to take Chinese territory. In 1915 they began to assert a dominant role in ports and small cities in Manchuria and Shandong. This subversive method of war culminated in 1931 with the taking of Northeast China and the establishment of a puppet government called Manchukuo. China was taken from the inside out.
The Taiping Rebellion changed the face of China. Every revolution that it inspired brought the country closer and closer to the rest of the world and to a communist ideal. Although the Taipings had heard neither of Karl Marx nor of Communism, they shared many of the same ideals. The Heavenly Kingdom of the Taipings is not so distant from the commune-oriented vision for the future. The Taiping leaders had attempted to establish a caste-free society based on egalitarian precepts. Land was evenly distributed. Slavery and the sale of women was outlawed, as were foot-binding, prostitution, arranged marriages, and polygamy. The Taipings were strongly against opium, alcohol, and tobacco. In short, the later Communist Revolution may have been but a realization of this secret society in China which operated in the mid-19th century.
The Taiping Rebellion played a significant role in ending China's isolationist outlook. The Nian Rebellion, Boxer Rebellion, and the Communist Revolution all stem from the emotions and ideas which emerged from the Taiping vision. The influx of strange, new things had started in China an unsettling movement, away from the old ways of the ancestors and into the Western sphere of influence. The attempts of the Taipings to end this unrest and to reinstate a golden era are similar in many points to the Communist attempts in the same direction. After the Taiping Rebellion, China would never again be a realm unto herself. With the failure of the Taiping movement, the age of the emperors was finished.
The Taiping movement itself was a product of the clash between the East and the West, which took place in the 19th century. The people of China, on the verge of joining the forming world community, took refuge briefly in their unique blend of traditional culture and modern idealism. For a time, they fended off the foreigners, the weak Emperors, the crowding countries, and strange cultures with this faith. When the Taiping Rebellion was crushed, the Chinese once again fled to an idealistic society, listening eagerly to the promises of Mao and Communism. In each of these cases, there was an inherent wish to return to the golden age of China, when the only threat to the unity of their lives was nature itself. The Taiping Rebellion was a reaction against progress, more importantly against change. That action continues to mold the current events in China, a sign that the people, not the central authority, can control the future of China.
Continuous Crisis
A string of civil disturbances followed the outbreak of Taiping Rebellion, many of which lasted for years and resulted in massive casualties. For instance, the Punti-Hakka Clan Wars pitted the Hakka against Punti (Cantonese people) in Guangdong between 1855 and 1867. The wars resulted in roughly a million dead with many more fleeing for their lives. The Nian Rebellion was an armed uprising that took place in northern China from 1851 to 1868, contemporaneously with the Taiping Rebellion in southern China. The rebellion caused immense economic devastation and loss of life that eventually became one of the major long-term factors in the collapse of the Qing regime in the early 20th century. The Dungan Revolt (1862 – 1877) was a mainly ethnic and religious war fought in western China. The revolt arose over a pricing dispute involving bamboo poles, when a Han merchant selling to a Hui did not receive the amount demanded for the goods. Up to 12 million Chinese Muslims were killed during the revolt as a result of anti-Hui massacres by Qing troops sent to suppress their revolt. Most civilian deaths were caused by war-induced famine. The Panthay Rebellion (1856-1873; discussed sometimes as part of the Dungan Revolt) was a rebellion of the Muslim Hui people and other non-Muslim ethnic minorities against the Manchu rulers in southwestern Yunnan Province as part of a wave of Hui-led multi-ethnic unrest. It started after massacres of Hui perpetrated by the Manchu authorities.
All rebellions were ultimately put down, but at enormous cost and with millions dead, seriously weakening the central imperial authority. The military banner system that the Manchus had relied upon for so long failed. Banner forces were unable to suppress the rebels and the government called upon local officials in the provinces, who raised “New Armies” that successfully crushed the challenges to Qing authority. As a result of that and with China failing to rebuild a strong central army, many local officials became warlords who used military power to effectively rule independently in their provinces.
Zeng Guofan’s strategy to fight anti-Qing rebels was to rely on local gentry to raise a new type of military organization. This new force became known as the Xiang Army, a hybrid of local militia and a standing army. The army’s professional training was paid for out of regional coffers and funds its commanders—mostly members of the Chinese gentry—could muster. This model would eventually lead to the further weakening of the central authority over the military.
Imperial China and the Western Powers
As Western powers at the end of the 19th century attempted to extract economic and territorial concessions from China’s Qing dynasty, the Chinese people’s reaction to this crisis was mixed. Some Chinese embraced Western ideas and practices and hoped to reform Chinese society along Western lines. Other Chinese fiercely opposed all Western influences; this was reflected in the Boxer Rebellion in 1900.
Learning Objectives
- Analyze the reaction of the Chinese government to foreign aggression in the 19th century.
- Assess the perceptions of Western ideas in China in the 19th and early 20th century.
Key Terms / Key Concepts
Boxers: a martial society, known as the Militia United in Righteousness (Yihetuan), motivated by proto-nationalist sentiments and opposition to imperialist expansion and associated Christian missionary activity in China at the end of the 19th century; a reference to the members of Yihetuan who practiced martial arts and claimed supernatural invulnerability towards Western weaponry
Boxer Rebellion: a violent anti-foreign and anti-Christian uprising in China between 1899 and 1901, toward the end of the Qing dynasty; was initiated by the Militia United in Righteousness (Yihetuan), known in English as the Boxers, and was motivated by proto-nationalist sentiments and opposition to imperialist expansion, as well as the associated Christian missionary activity
Hundred Days’ Reform: a failed 103-day national cultural, political, and educational reform movement from June 11 to September 21, 1898 in late Qing dynasty China. It was undertaken by the young Guangxu Emperor and his reform-minded supporters. The movement was short-lived, ending in a coup d’état by powerful conservative opponents led by Empress Dowager Cixi
Boxer Protocol: a treaty signed on September 7, 1901 that ended the Boxer Rebellion; participants included the Qing Empire of China and the Eight-Nation Alliance that provided military forces—Austria-Hungary, France, Germany, Italy, Japan, Russia, the United Kingdom, and the United States, as well as Belgium, Spain, and the Netherlands; provided for the execution of government officials who supported the Boxers, foreign troops to be stationed in Beijing, and 450 million taels of silver to be paid as indemnity over the next 39 years to the eight nations involved
Juye Incident: the killing of two German Catholic missionaries— Richard Henle and Franz-Xavier Nies of the Society of the Divine Word—in Juye County Shandong Province, China on November 1, 1897
Legation Quarter: the area in Beijing, China, where a number of foreign legations were located between 1861 and 1959; located in the Dongcheng District, immediately east of Tiananmen Square
Gaselee Expedition: a successful relief by a multi-national military force to march to Beijing and protect the diplomatic legations and foreign nationals in the city from attacks in 1900; part of the war of the Boxer Rebellion
New Policies: a series of political, economical, military, cultural, and educational reforms implemented in the last decade of the Qing dynasty to keep it in power after the humiliating defeat in the Boxer Rebellion, starting in 1901
Seymour Expedition: an attempt by a multi-national military force to march to Beijing and protect the diplomatic legations and foreign nationals in the city from attacks by Boxers in 1900 (The Chinese army forced it to return to Tianjin, also known as Tientsin).
Nine-Power Treaty: a 1922 treaty affirming the sovereignty and territorial integrity of China as per the Open Door Policy; signed on February 6, 1922, by all attendees to the Washington Naval Conference—the United States, Belgium, the British Empire, Republic of China, France, Italy, Imperial Japan, the Netherlands, and Portugal
Lansing-Ishii Agreement: a diplomatic note signed between the United States and the Empire of Japan on November 2, 1917, over their disputes with regards to China (Both parties pledged to uphold the Open Door Policy in China with respect to its territorial and administrative integrity. However, the United States government also acknowledged that Japan had “special interests” in China due to its geographic proximity, which was in effect a contradiction to the Open Door Policy.)
Open Door Policy: a term in foreign affairs initially used to refer to the United States policy established in the late 19th century and the early 20th century, as enunciated by Secretary of State John Hay; proposed to keep China open to trade with all countries on an equal basis, preventing any one power from total control of the country
The Self-Strengthening Movement
In response to calamities within the Qing empire and threats from imperialism, the Self-Strengthening Movement emerged. This institutional reform in the second half of the 19th century aimed to westernize the empire, with prime emphasis on strengthening the military. However, the reform was undermined by corrupt officials, cynicism, and quarrels within the imperial family. The Guangxu Emperor and the reformists then launched a more comprehensive reform effort—the Hundred Days Reform (1898), but it was soon overturned by the conservatives under Empress Dowager Cixi in a military coup. The anti-Qing sentiment only strengthened as the internal chaos and foreign influences grew, finally leading to the Boxer Rebellion: a violent anti-foreign and anti-Christian uprising that was a turning point in the history of Imperial China.
The Boxer Rebellion
The Boxer Rebellion—a violent anti-foreign and anti-Christian uprising that took place in China between 1899 and 1901—both exposed and deepened the weakening of the Qing dynasty’s power. The Righteous and Harmonious Fists (Yihetuan) arose in the inland sections of the northern coastal province of Shandong, an area long known for social unrest, religious sects, and martial societies. American Christian missionaries were probably the first to refer to the well-trained, athletic young men as Boxers because of the martial arts and calisthenics they practiced. Their primary practice was a type of spiritual possession that involved the whirling of swords, violent prostrations, and chanting incantations to deities. The excitement and moral force of these possession rituals were especially attractive to unemployed and powerless village men, many of whom were teenagers.
The Boxers believed that through training, diet, martial arts, and prayer they could perform extraordinary feats. The tradition of possession and invulnerability went back several hundred years but took on special meaning against the powerful new weapons of the West, which included Christian missionaries. The Boxers, armed with rifles and swords, claimed supernatural invulnerability to blows of cannon, rifle shots, and knife attacks. Furthermore, the Boxer groups popularly claimed that millions of soldiers of Heaven would descend to assist them in purifying China of foreign oppression.
Although women were not allowed to join the Boxer units, they formed their own groups called the Red Lanterns. Popular local lore reported that they were able to fly, walk on water, set Christians’ homes on fire, and stop foreign guns; all of these were powers that the male Boxers themselves did not claim. The only reliable account of their actual activities comes from the 1900 Battle of Tientsin, when they nursed wounded Boxers and did domestic work such as sewing and cleaning.
Causes of Rebellion
International tension and domestic unrest fueled the spread of the Boxer movement. Natural disasters and the rights granted to European missionaries were two of the foremost instigations. A drought followed by floods in Shandong province in 1897 – 1898 forced farmers to flee to cities and seek food. And treaties signed after the Second Opium War granted foreign missionaries the freedom to preach anywhere in China and buy land on which to build churches.
The Juye Incident occurred in 1897, when a band of armed men who were likely members of the Big Swords Society—a traditional peasant self-defense group widespread in northern China—stormed the residence of a German missionary and killed two priests. When Kaiser Wilhelm II received news of these murders, he dispatched the German East Asia Squadron to occupy Jiaozhou Bay on the southern coast of the Shandong peninsula. Germany’s action triggered a scramble by Britain, France, Russia, and Japan to also secure their own spheres of influence in China.
In 1898, a group of Boxers attacked the Christian community of Liyuantun village where a temple to the Jade Emperor had been converted into a Catholic church. This incident marked the first time the Boxers used the slogan “Support the Qing, destroy the foreigners” that would later characterize them. The Boxers called themselves the Militia United in Righteousness for the first time at the Battle of Senluo Temple (1899), a clash between Boxers and Qing government troops. By using the word militia rather than Boxers, they distanced themselves from forbidden martial arts sects and tried to give their movement the legitimacy of a group that defended orthodoxy.
By 1900, the Qing dynasty was crumbling, and Chinese culture was under assault by powerful and unfamiliar religions and secular cultures. Despite the obvious internal weaknesses, the national crisis was widely seen as being caused by foreign aggression. Foreign powers had defeated China in several wars, asserted a right to promote Christianity, and imposed unequal treaties, under which foreigners and foreign companies in China were accorded special privileges, extraterritorial rights, and immunity from Chinese law; this caused resentment and xenophobic reactions among the Chinese. When France, Japan, Russia, and Germany carved out spheres of influence, it appeared to the Chinese that their nation would be dismembered, with foreign powers each ruling a part of the country.
Spreading Rebellion
The early growth of the Boxer movement coincided with the Hundred Days’ Reform (June 11 – September 21, 1898). Progressive Chinese officials, with support from Protestant missionaries, persuaded the Guangxu Emperor to institute sweeping reforms that alienated many conservative officials. Such opposition from conservative officials led Empress Dowager Cixi to intervene and reverse the reforms. The failure of the reform movement disillusioned many educated Chinese and thus further weakened the Qing government. After the reforms ended, the conservative Empress Dowager Cixi seized power and placed the reformist Guangxu Emperor under house arrest.
In January 1900, with a majority of conservatives in the imperial court, Empress Dowager Cixi changed her long-standing policy of suppressing Boxers and issued edicts in their defense, causing protests from foreign powers. As a result, the Boxer movement spread rapidly. They burned Christian churches, killed Chinese Christians, and intimidated Chinese officials who stood in their way. After several months of growing violence against both the foreign and Christian presence in Shandong and the North China plain in June 1900, Boxer fighters, convinced they were invulnerable to foreign weapons, converged on Beijing. This resulted in foreigners and Chinese Christians seeking refuge in the Legation Quarter and the Eight-Nation Alliance sending the Seymour Expedition of Japanese, Russian, Italian, German, French, American, and Austrian troops to relieve the siege. The Expedition was stopped by the Boxers at the Battle of Langfang and forced to retreat. Due to the Alliance’s attack on the Dagu Forts, the Qing government in response sided with the Boxers and the initially hesitant Empress Dowager Cixi supported the Boxers. On June 21, 1900, she issued an Imperial Decree officially declaring war on the foreign powers. The Alliance formed the second, much larger Gaselee Expedition and finally reached Beijing, resulting in the Qing government’s evacuation to Xi’an.
The Boxer Protocol signed on September 7, 1901 ended the war between the Qing Empire of China and the Eight-Nation Alliance. It provided for the execution of government officials who had supported the Boxers, for foreign troops to be stationed in Beijing, and for the payment of 450 million taels of silver—more than the government’s annual tax revenue—to be paid as indemnity over the course of the next 39 years to the eight nations involved.
The Boxer Protocol led to official US government support of Chinese students studying in America. A large portion of the reparations paid to the United States was diverted to pay for the education of Chinese students in U.S. universities under the Boxer Indemnity Scholarship Program. To prepare the students chosen for this program, an institute was established to teach the English language and serve as a preparatory school. When the first of these students returned to China, they taught subsequent students. From this institute was born Tsinghua University. Some of the reparation due to Britain was later earmarked for a similar program. And these programs led to increased Western influence in China.
Carving Up China
In the late-nineteenth century, the major imperial powers competed aggressively for domination of most of the world’s territory. Railroads supported increasing penetration of remote regions, and the telegraph rapidly communicated one nation’s victory to others around the world, empowering a sense of competition. Each imperial power felt that it had to defend its own territories and pre-empt the moves of others.
The first durable trans-Atlantic telegraph cable, laid in 1866, connected the New and Old Worlds with a rapid communication link. The opening of the Suez canal in 1869 dramatically shortened the route to the Far East, just as the U.S. completed the transcontinental railroad. As regions of the Ottoman empire loosened their dependence on the central government of the Ottoman Sultan, the French, British, and Russians looked to expand their influence in that region. The “Scramble for Africa,” touched off in 1882 by the submission of the ruler of Tunis to a French resident, was followed by British intervention to secure its financial investments in Egypt. Over the next twenty years British, French, Belgian, and German troops, explorers, and investors carved up nearly all of the African continent. In the 1890s, the global scramble expanded to Asia, and new powers joined the race. Japan’s defeat of China in the Sino-Japanese war in 1895 put Taiwan and Korea under its control; this ensured Japan emerged as the next imperialist power in Asia. The United States joined the pack of genuine imperial powers with its victory in the Spanish-American War of 1898, which added Cuba, Puerto Rico, and the Philippines to the list of its colonial possessions. Russia, turning eastward, began building the trans-Siberian railroad in 1891 to connect its Asian regions closely to Moscow. The railroad reached the port of Vladivostok (meaning “Ruler in the East”) in 1916. Russia’s turn to the East inevitably brought it into conflict with the rival powers of northeast Asia: China, Korea, and Japan. As Britain and Russia competed in the “Great Game” for power over Central Asia, Britain allied with Japan in 1902 to balance Russian expansion. The multipower scramble for China, from 1895 to 1905, followed a similar pattern to that of Africa, but with very different results.
Critique of the Break-up and Foreign Conquest of China
Japan’s surprising defeat of the Qing empire instigated all the powers to secure spheres of influence connected to their economic interests, and fears of “slicing the Chinese cake” increased. Many writers predicted the imminent breakup of the empire into regions, each dominated by one imperial power.
As it happened, the push to carve China into foreign spheres of interest coincided with a revolutionary transformation in the nature of international communication. Advances in telegraph transmission expedited the speed of journalistic reporting. At the same time—and more vivid and dramatic—the turn of the century saw a great leap forward in color printing. The lavish political cartoons in illustrated periodicals such as Punch in England and Puck in the United States are classic examples of this explosion in dramatic, colorful political commentary. They had counterparts, moreover, throughout Europe. The images below exhibit variants of the metaphor of the slicing of China, representing critiques from French, American, and British perspectives.
One popular form of critiquing “the slicing of China” was through cartoons or comic images. In Puck, the American counterpart to the famous British humor magazine Punch, Louis Dalrymple sardonically juxtaposed U.S. expansion in and immediately after the Spanish-American War of 1898 against the contemporaneous scramble by other imperialist powers to carve up China. As in the French cartoon, “No Chance to Criticize” presents Russia, France, Germany, Japan, and England slicing the Chinese cake, but the not-so-subtle point of this cartoon was that while the United States self-righteously criticized the foreign scramble for spheres of influence in China and called for an “Open Door” policy there, it was in the process of establishing its own spheres of influence in the Caribbean and the Philippines.
In Le Petit Journal Supplément Illustré, another French perspective on the matter appeared as “La France et La Russie. — Pas si vite! Nous sommes là.” In the foreground of the image England and Japan, who had just negotiated the Anglo-Japanese alliance in 1902, find themselves surprised by Russia and France, who claim equal rights in slicing the Chinese cake.
In the following cartoon by Louis Dalrymple, Britain—which held the dominant position in spheres of influence in China—confronts the rival claims of Russia and Germany, while the French cock squawks in the rear.
In addition to cartoons or comic representations, visual rhetoric in the form of cartographic commentary was popular. Two maps published in Harper’s Weekly (1900) graphically depict the imperialist rivalries and tensions that accompanied the carving up of China.
In “A Forecast of the Partition of China” spheres of influence are “forecasted,” revealing Russian, German, British, French, Japanese, and Italian claims in the beleaguered country.
“Map of the Orient showing Manila, P.I. as the Geographical Centre of the Oriental Commercial Field” highlights the strategic significance of the U.S. conquest and colonization of the Philippines in 1899 – 1900, which placed America at “the geographical centre of the Oriental commercial field.”
The anxiety over China’s partition shown in the previous two maps helps to explain why U.S. foreign policy called for an “open door” in China, in which all foreign powers had equal rights to exploit China’s territory, without reserved spheres of influence.
Along with the technological transformation was the emergence of international postal regulations that facilitated the global dissemination of picture postcards. Images produced in one country were frequently reproduced for a global audience—sometimes so quickly that the original place of origin became obscured. Naturally, this heightened popular awareness of international affairs. Beyond this, it also stimulated international give-and-take in the form of graphic replication, imitation, adaptation, and even outright parody. A particularly colorful example of this new world of pictorial global sharing was a bilingual English and Chinese political map of foreign encroachment on China at the time of the Boxer uprising. Of uncertain origin, this was disseminated in several variations. The colloquial correctness of English notations on the map make some kind of British-Chinese collaboration plausible.
One version—reproduced in the American magazine Leslie’s Weekly in 1900—assigns authorship to a Chinese artist in Hong Kong in July 1899. The most sophisticated and often reproduced rendering of this elaborate geopolitical commentary—replete with the Russian bear, British lion, American eagle, French frog, Japanese rising sun, and caricatures of the Chinese—bears a bold border of Chinese ideographs. Clearly, this was directed to Chinese (and possibly Japanese) audiences.
In the following image the bold lettering in the borders reads “Picture of Current Times” (top), “Obvious in One Glance” (left), and “It Speaks for Itself” (right). The Russian bear approaches from Siberia. Japan, who would go to war with Russia in 1904, is identified as “The Rising Sun” and accompanied by a parenthetical declaration that “John Bull & I will watch the bear.” (A reference to the Anglo-Japanese Alliance of 1902.) England—here depicted as a lion (rather than the bulldog on the 1899 map)—sinks its claws into south China, while a circular sausage with the legend “German Sausage Ambitions” surrounds Shandong. The American eagle, approaching from the Philippines, bears the quotation “Blood is thicker than water,” a famous comment made by a U.S. admiral in 1859 indicating that the U.S. would side with Britain in the Second Opium War. France, depicted as a frog, is ensconced in Southeast Asia and reaches toward China, with the words “Fashoda: Colonial Expansion” on its back, referring to the clash between British and French troops in East Africa in 1898. The Chinese figures (which do not appear on the 1899 version of the map) depict Manchu soldiers, coolie laborers, sleeping officials, and literati carousing with mistresses while the wild beasts prowl.
Imperialist Rivalries
Although the imperial powers joined together to raise an Eight Nation Army to relieve the siege by the Boxers, each of the major powers had its own special relationship with China and its own view of its geopolitical interests. In sum, each of the imperial powers had its particular motives for sending troops to China, and each of them distrusted the others. The deluge of global imagery from this period thus not only reveals a common racial prejudice against savage Orientals, but also shows the deep tensions between the powers that were only temporarily soothed by the joint expedition.
Great Britain
The British were still the predominant world imperial power, as they had been during the nineteenth century since the defeat of Napoleon. Their primary interests in China were commercial, and they focused most of their attention on the lower Yangzi valley, while they sent steamships up the Yangzi to obtain goods from the interior. They also held Hong Kong and developed substantial commerce in the Canton region. But British dominance, based on its control of the oceans and its large colony in India, was coming under challenge from several fronts. Germany began building a navy to contest British supremacy, while the French moved to take control of Indochina and extend their interests into south China. Russia presented a constant imagined threat to India as it moved into Central Asia.
From 1899 to 1902, British troops in South Africa fought a war against two independent republics founded by Dutch Afrikaners, the Transvaal and the Oranje Vrijstaat. Early victories by the British were not decisive, as the Boers waged a drawn-out guerrilla war campaign, just as the Filipinos were doing against American forces at the same time. Both countries used brutal tactics of internment of civilian populations in concentration camps and ravaging of the countryside to force surrender by the farmer fighters. The popular press, however, showed a sanitized picture of the war, with traditional pictures and lithographs of military operations. But the Boers were depicted as savages, analogous to the Boxers in their closeness to the earth and rejection of the British civilizing mission.
France
The French, unlike the British, had never created a successful East India Company to participate in the Canton trading system, and they had not traded in opium. Initially, their primary interest in China was the promotion and protection of Christianity. They joined with the British in 1856 to make war on China, benefiting the most from the provisions of the treaty ending the Second Opium War (1856 – 1860), which allowed missionary access to the Chinese interior. Beginning in the late-nineteenth century, they moved to take control of Indochina. In 1884, they fought their first independent war with China, when the court in Vietnam appealed for aid from China against French incursions. The French victory in the Sino-French war gave the French unimpeded control of Indochina, and the opportunity to spread their influence in south and southwest China. They sent commercial missions to the region to explore mineral and plant resources and to plan for railroad development.
Germany
Germany, unified as a nation state in 1870, soon felt that it, too, needed an imperial mission to make itself into a recognized world power and to secure sources of raw materials for its rapid industrialization. Germany joined the struggle to carve up Africa, established a colony in Samoa, and looked for a chance to take a piece of Chinese territory. German missionaries also penetrated the Shandong province under government protection beginning in the 1890s. When Chinese murdered two German missionaries in 1897, the Germans found their pretext and occupied Jiaozhou on the coast of Shandong, forcing the Chinese government to lease the territory to them for 99 years. Jiaozhou became a popular tourist destination for Germans, who sent back postcards depicting both its exotic markets and the availability of familiar German products like beer and sausages. Additionally, the Germans founded the first major beer factory in Jiaozhou’s capital of Qingdao in 1903; Tsingtao beer is still the most popular Chinese beer sold abroad. And postcards produced by Germans celebrated the harmonious mingling of different races—white, Asian, and black—in the new German empire.
The United States
The United States was also a latecomer to the cause of imperialism in Asia. Although Commodore Matthew Perry’s ships had begun the opening of Japan in 1853, and Americans eagerly participated in both the Canton trade and the chances to trade in opium after the opening of Chinese ports, Americans still saw themselves as different from European powers who aimed to occupy territory in China. American missionaries and businessmen hoped to help Asian peoples become richer and stronger without imposing discriminatory treaties on them and they argued that free trade would benefit all countries equally.
The American proposal for an “Open Door” that made Chinese markets available to all countries equally implied that no single power could occupy territory with exclusive rights. All the other imperial powers, who did occupy Chinese territory, paid lip service to the American proposal but ignored it in practice. For much of the nineteenth century the U.S., with its huge continental territory, was either insulated from economic dependence on the wider world across the Pacific, or it was too involved in the domestic repercussions of the Civil War to pay attention to geopolitical concerns. But as its industrial economy needed more overseas markets and materials from abroad, and its expansion continued beyond the west coast into the Pacific, the U.S. inexorably became an imperial power in its own right.
Promoters of open imperialist annexations argued that the U.S. needed to compete for global commercial supremacy by securing raw materials and territories. American businessmen staged a coup in Hawaii in 1893, and the U.S. annexed the islands in 1898. The takeover of the Philippines from Spain in 1898 was followed by a brutal campaign to suppress the anti-imperialist Filipino force led by Emilio Aguinaldo. Popular journalists depicted the U.S. as a benevolent school teacher lifting the burden of Catholic medievalism from the ordinary Filipino peasant, as well as repelling the corrupt banditry of Aguinaldo and his rebels. Geopolitical analysts focused on the Philippines as the key gateway to Asia for American commerce.
The U.S. experience in the Philippines certainly affected views of the role of U.S. troops in the relief of the Boxer siege of foreign legations in Beijing. Images of benevolence toward smaller dark-skinned people transferred easily from one Asian country to another, but the awareness that Asian peoples could resist white domination with harsh military action prepared the American public to accept that the Boxers represented yet another savage, inexplicable outburst by ungrateful Asians against their white benefactors.
Chinese immigration to the U.S. also added a distinctive element to the American image of the Orient. Chinese had begun to leave Canton in significant numbers in the 1850s to flee the disturbances of the Taiping rebellion (1850 – 64) and to participate in the gold rush in America. During the 1860s many Chinese immigrants worked to build the first transcontinental railroad in America, which was completed in 1869.
The Burlingame treaty of 1868, which normalized relations between China and the U.S. also provided for free immigration of Chinese but did not allow Chinese to become citizens. In this era, many Americans believed that non-Europeans were racially inferior and incapable of becoming citizens of their republic.
Japan
Of all the nations engaged in the Boxer expedition, Japan and Russia had the most well-defined material and territorial interests to protect, and the most reason to distrust each other. In the Sino-Japanese war of 1895, Japan had established preeminent influence over Korea, forcing Korea open to Japanese trade and driving out the pro-Chinese faction in the country. Japan saw its role in Korea in the same way as the other imperial powers viewed their own colonial actions; Japan claimed to bring “enlightenment” in the form of modern science and culture to backward peoples. Japan had no missionaries to protect in China, and it was not a target of Boxer attacks, but it identified itself with the Western powers’ goal of forcing China to accept trade and modern culture, and it saw advantages in joining the Western expedition as a way of raising its status among the Western powers. Not until the signing of the Anglo-Japanese alliance of 1902, directed against Russia, could Japan gain recognition of its role as one of the major world powers. Its participation in the Boxer expedition, for which it sent the largest number of troops and often took the lead in attacks, showed that Japanese could fight for the Western version of “civilization” even more effectively than the Westerners themselves. Most Japanese graphic renderings of the multinational intervention tended to be detailed and relatively straightforward nationalistic depictions that emphasized the discipline of Japan’s military forces and their equality to and close collaboration with the Western powers.
The Japanese sense of perfect equivalence to the Western powers was rarely reciprocated, however. On the contrary, most European and American depictions of the foreign forces in China routinely depicted the Japanese as “little men”—not only vis-à-vis the Westerners, but vis-à-vis China and the Chinese as well. A full-page treatment in Harper’s Weekly in early 1900—five full years after Japan had crushed China in the Sino-Japanese War of 1894 to 1895—reflected the resilience of this lingering anti-Japanese condescension.
Russia
Russia was the power with the longest historical engagement with China, having signed its first treaties with the Qing dynasty in 1689 and 1727. The early period of equitable interaction changed in the late-nineteenth century, when Russia took advantage of China’s defeat in the Second Opium War to gain its own favorable treaty, sending troops into the Ili valley during the Muslim uprisings of the 1870s, where they stayed until China forced them out diplomatically in 1881. By the 1890s, Russia had developed its commercial interests on the Pacific coast, founding the town of Vladivostok in 1880. But Russian interests in the Far East faced resistance both from the British, who feared a potential move against India, and from Japan, which aimed for uncontested influence in Korea. Russia, like Japan, had no missionary activities in China and was not a target of Boxer attacks, but it saw the foreign expedition as a golden opportunity to take advantage once again of China’s weakness and other powers’ interests to advance its own at low cost. The Russian Minister for War General Alexi Kuropatkin, as well as the Minister of Finance Count Sergei Witte, saw the Boxer expedition as a perfect excuse for seizing Manchuria and turning it into a Russian colony.
Dangerous China: Another Kind of China Peril
As a general rule, most foreign caricatures of China depicted the country as either a formidable menace to the world or a small backwater ripe for commercial penetration. A cartoon published in the American periodical Judge in 1898, as the Boxer depredations were about to rise to a crescendo, conveyed a somewhat different picture. Here the world was a “see-saw,” in which the Anglo-American powers were engaged in a uneven “balance of power” game vis-a-vis the other major nations of the world. In this power struggle, some countries already had fallen off the see-saw— and China was hanging on for dear life and perilously close to falling also.
Awakening China
As the Boxer uprising flared into the multinational intervention, some graphic renderings depicted an even more precarious picture of the see-saw of imperialist rivalries. In this situation, China itself became a potential source of global discord—a giant firecracker; a dark and dangerous terrain to navigate, full of traps that might lead to future wars; a “sword of Damocles” hanging by a thread over the heads of the interventionist powers. The danger was multifold. Intervention threatened to intensify already-existing rivalries among the imperialist powers (as indeed happened, when the intervention was followed four years later by war between Tsarist Russia and Japan). At the same time, the humiliation of China threatened to awaken the nation in truly perilous ways. This latter premonition became especially strong in 1901. The victorious foreign powers had weakened the Qing court by imposing a harsh indemnity on it, and by forcing it to execute officials who had stirred up the Boxers, but they shared an interest in keeping the dynasty alive. They feared the possibility of another uprising of the Chinese masses and the onset of conflict between the imperial powers themselves. This China, unlike the slain dragon, as firecracker or as sword of Damocles, threatened to blow up the imperial world order.
Consequences of the Boxer Rebellion
The European great powers finally ceased their ambitions to colonize China, having learned from the Boxer Rebellion that it was best to deal with China’s ruling dynasty, rather than directly with the Chinese people. Concurrently, this period marks the ceding of European great power interference in Chinese affairs, with the Japanese replacing the Europeans as the dominant power for their lopsided involvement in the war against the Boxers, as well as their victory in the First Sino-Japanese War (1894 – 95). With the toppling of the Qing that followed and the rise of the nationalist Kuomintang, European sway within China was reduced to symbolic status.
In 1900, Russia occupied Manchuria, a move that threatened Anglo-American hopes of maintaining what remained of China’s territorial integrity and the country’s openness to commerce under the Open Door Policy. Japan’s clash with Russia over Liaodong and other provinces in eastern Manchuria, due to the Russian refusal to honor the terms of the Boxer protocol that called for their withdrawal, led to the Russo-Japanese War when two years of negotiations broke down in 1904. Russia was ultimately defeated by an increasingly confident Japan. After taking Manchuria in 1905, Japan came to dominate Asian affairs both militarily and culturally.
Besides paying reparations to European powers and Japan due to its support of the Boxers, the government of the Empress Dowager Cixi reluctantly started some reforms despite her previous views. Under her reforms known as the New Policies started in 1901, the imperial examination system for government service was eliminated and as a result the system of education through Chinese classics was replaced with a European liberal system that led to university degrees. Along with the formation of new military and police organizations, the reforms also simplified central bureaucracy and revamped taxation policies.
From the beginning, views differed as to whether the Boxers were better seen as anti-imperialist, patriotic, and proto-nationalist or as violent, irrational, and futile opponents of inevitable change. More recently, Chinese historians have undermined the dominant history textbook narrative in China, which presents the Boxer Uprising as an admirable expression of patriotism. The historians emphasize the damage and suffering that the rebellion caused and note that the majority of the Boxer rebels were both violent and xenophobic. This reinterpretation remains controversial in China.
The Open Door Policy
At the conclusion of Boxer Rebellion, the United States continued to advocate for and Open Door Policy concerning China. After winning the Spanish-American War of 1898 and acquiring the Philippine Islands, the United States also increased its Asian presence and was expecting to further its commercial and political interest in China. However, the United States felt threatened by other powers’ much larger spheres of influence in China and worried that it might lose access to the Chinese market should the country be partitioned. As a response, U.S. diplomat William Woodville Rockhill formulated the Open Door Policy to safeguard American business opportunities and interests in China. In 1899, U.S. Secretary of State John Hay sent notes to France, Germany, Britain, Italy, Japan, and Russia, asking them to declare formally that they would uphold Chinese territorial and administrative integrity and would not interfere with the free use of the treaty ports within their spheres of influence in China. The Open Door Policy stated that all nations, including the United States, could enjoy equal access to the Chinese market. In reply, each country tried to evade Hay’s request, taking the position that it could not commit itself until the other nations had complied. However, Hay announced that each of the powers had granted consent in principle. In 1900, Britain and Germany signed the Yangtze Agreement, which provided that they would oppose the partition of China into spheres of influence. The agreement was an endorsement of the Open Door Policy. Nonetheless, competition between the various powers for special concessions within Qing dynasty China for railroad rights, mining rights, loans, foreign trade ports, and privilege continued unabated.
Open Door Policy in Practice
In 1902, the United States government protested the Russian encroachment in Manchuria after the Boxer Rebellion as a violation of the Open Door Policy. When Japan replaced Russia in southern Manchuria after the Russo-Japanese War (1904 – 05), the Japanese and U.S. governments pledged to maintain a policy of equality in Manchuria.
In 1917, a diplomatic note was signed between the United States and Japan to regulate disputes over China. Signed by U.S. Secretary of State Robert Lansing and Japanese special envoy Ishii Kikujirō—and known as the Lansing-Ishii Agreement, the note pledged to uphold the Open Door Policy in China with respect to its territorial and administrative integrity. However, the United States government also acknowledged that Japan had “special interests” in China due to its geographic proximity, especially in those areas of China adjacent to Japanese territory, which was in effect a contradiction to the Open Door Policy. In a secret protocol attached to the public note, both parties agreed not to take advantage of the special opportunities presented by World War I to seek special rights or privileges in China at the expense of other nations allied in the war effort against Germany.
At the time, the Lansing-Ishii Agreement was touted as evidence that Japan and the United States had laid to rest their increasingly bitter rivalry over China, and the Agreement was hailed as a landmark in Japan-U.S. relations. However, critics soon realized that the vagueness of the Agreement meant that nothing had really been decided after two months of talks.
The Lansing-Ishii Agreement was replaced in 1923 by the Nine-Power Treaty. During the Washington Naval Conference of 1921 – 1922, the United States government again raised the Open Door Policy as an international issue and had all of the attendees (United States, Republic of China, Imperial Japan, France, Great Britain, Italy, Belgium, Netherlands, and Portugal) sign the Nine-Power Treaty, which intended to make the Open Door Policy international law. The Nine-Power Treaty affirmed the sovereignty and territorial integrity of China as per the Open Door Policy. It also effectively prompted Japan to return territorial control of Shandong province (a former German holding in China controlled by Japan as a result of World War I) to the Republic of China.
The Nine-Power Treaty lacked any enforcement regulations, and when violated by Japan during its invasion of Manchuria in 1931 and creation of Manchukuo, the United States could do little more than issue protests and impose economic sanctions. In 1937, the signatories of the Nine-Power Treaty convened in Brussels for the Nine Power Treaty Conference after the outbreak of the Second Sino-Japanese War, but to no avail. World War II effectively violated the Nine-Power Treaty.
In conclusion, the Open Door Policy was a principle that was never formally adopted via treaty or international law. It was invoked or alluded to but never enforced as such. In practice, it was used to mediate competing interests of the colonial powers without much meaningful input from the Chinese, creating lingering resentment and causing it to later be seen as a symbol of national humiliation by Chinese historians.
Primary Source: Fei Ch'i-hao: The Boxer Rebellion, 1900
Fei Ch'i-hao was a Chinese Christian. Here he recounts the activities of the millenialist "Boxers" in the Boxer Rebellion of 1900.
The Gathering of the Storm
The people of Shansi are naturally timid and gentle, not given to making disturbances, being the most peaceable people in China. So our Shansi Christians were hopeful for themselves, even when the reports from the coast grew more alarming. But there was one thing which caused us deep apprehension, and that was the fact that the wicked, cruel YU Hsien, the hater of foreigners, was the newly appointed Governor of Shansi. He had previously promoted the Boxer movement in Shantung, and had persuaded the Empress Dowager that the Boxers had supernatural powers and were true patriots.
Early in June my college friend K'ung Hsiang Hsi came back from T'ungchou for his vacation, reporting that the state of affairs there and at Peking was growing worse, that the local officials were powerless against the Boxers, and that the Boxers, armed with swords, were constantly threatening Christians scattered in the country.
From this time we had no communication with Tientsin or Peking. All travellers were searched, and if discovered bearing foreign letters they were killed. So though several times messengers were started out to carry our letters to the coast, they were turned back by the Boxers before they had gone far. It was not long before the Boxers, like a pestilence, had spread all over Shansi. School had not closed yet in Fen Chou Fu, but as the feeling of alarm deepened, fathers came to take their boys home, and school was dismissed before the end of June.
Mr. and Mrs. Lundgren and Miss Eldred of the China Inland Mission had come to Mrs. Price's about the middle of June, and after the Boxer trouble began they were unable to leave. Mr. and Mrs. Lundgren soon heard that their mission at P'ing Yao had been burned.
During the two long months that followed not a word reached us from beyond the mountains. The church in Shansi walked in darkness, not seeing the way before it.
The wicked Governor, Yü Hsien, scattered proclamations broadcast. These stated that the foreign religions overthrew morality and inflamed men to do evil, so now gods and men were stirred up against them, and Heaven's legions had been sent to exterminate the foreign devils. Moreover there were the Boxers, faithful to their sovereign, loyal to their country, determined to unite in wiping out the foreign religion. He also offered a reward to all who killed foreigners, either titles or office or money. When the highest official in the province took such a stand in favor of the Boxers, what could inferior officials do? People and officials bowed to his will, and all who enlisted as Boxers were in high favor. It was a time of license and anarchy, when not only Christians were killed, but hundreds of others against whom individual Boxers had a grudge.
Crowds of people kept passing our mission gate to see what might be happening, for the city was full of rumors. "The foreigners have all fled."
"Many foreigners from other places have gathered here."
"A great cannon has been mounted at the mission gate."
"The foreigners have hired men to poison wells, and to smear gates with blood."
I was staying in the compound with the Prices, inside the west gate of the city, and Mr. and Mrs. Atwater, with their children, Bertha and Celia, lived near the east gate. On the 28th of June all day long a mob of one or two hundred roughs, with crowds of boys, stood at the gate of the Atwater place, shouting:
"Kill the foreigners, loot the houses."
Mr. Atwater came out once and addressed the crowd:
"Friends, don't make this disturbance; whoever would like to come in, I invite to come, and we will talk together."
When the crowd saw Mr. Atwater come out, they all retreated, but when he shut the gate they thronged back again with mad shouts. This happened several times. By six or seven in the evening the crowd had increased and gathered courage. The gate was broken down and they surged in, some shouting, some laying hands on whatever they could find to steal, some throwing stones and brickbats at the windows. As they rushed in, Mr. Atwater and his family walked through their midst and took refuge in the Yamen of the District Magistrate, which was near by. The Magistrate, not even waiting for his official chair, ran at once to the mission and arrested two men with his own hands. His attendants followed close behind him, and the mob scattered. The Magistrate then sent soldiers to stand guard at the mission gate, and the Atwaters came to live with the Prices. We expected the mob to make an attack on us that same night, but we were left in peace...
Late in july a proclamation of the Governor was posted in the city in which occurred the words, "Exterminate foreigners, kill devils." Native Christians must leave the church or pay the penalty with their lives. Li Yij and I talked long and earnestly over plans for saving the lives of our beloved missionaries. "You must not stay here waiting for death," we said. Yet we realized how difficult it would be to escape. Foreigners with light hair and fair faces are not easily disguised. Then where could they go? Eastward toward the coast all was in tumult. Perhaps the provinces to the south were just as bad. Our best way would be to find a place of concealment in the mountains. Li Y0 and I thought that the chances of escape would be better if the missionaries divided into two companies; they must carry food, clothing, and bedding, and the large company would surely attract attention. Moreover, if they were in two parties, and one was killed, the other might escape. So Li Yü and I went to talk the matter over with Mr. Han, the former helper, and a Deacon Wang. Both of these men had recanted, but they still loved their foreign friends. Deacon Wang, who lived in a village over ten miles from Fen Chou Fu, wished to conceal Mr. and Mrs. Price and little Florence in his home for a day or two, and then take them very secretly to a broken-down temple in the mountains. Li Yü said to me:
"If you can escape with Mr. and Mrs. Price to the mountains, I will try to take the Atwaters, Mr. and Mrs. Lundgren, and Miss Eldred to another place in the mountains."
But when I proposed this plan to Mr. and Mrs. Price, they said:
"We missionaries do not wish to be separated. We must be in one place, and if we die we want to die together."
When I spoke to them again about going, they said:
"Thank you for your love, but we do not want to desert the other missionaries."
"You will not be deserting them," I pleaded. "If you decide to flee with me, Mr. Li will do his best to escape with the others."
Then I brought forward all my arguments to persuade them. Again all consulted together, and decided to go. I think this was the last day of July-the very day of the Tai Ku tragedy. Mr. and Mrs. Price made up two bundles of baggage and gave them to Mr. Han, to be carried secretly to Deacon Wang's home. Mr. Han paid a large price for a covered cart to wait for us secretly at ten o'clock in the evening at the gate of an old temple north of the mission. We were to walk to the cart, as it would attract attention if the cart stopped near the mission. We could not leave by the front gate, for the four Yamen men were guarding it; and patrolling the streets in front by day and night were twenty soldiers, ostensibly protecting us, but, as we surmised, stationed there to prevent the escape of foreigners. I went privately to the back of the compound and unlocked an unused gate, removing also a stone which helped to keep it shut. I had already made up a bundle to carry with me, and asked Mr. Jen, a Chirstian inquirer, to take care of it while I was helping Mr. and Mrs. Price to get ready. After I had opened the gate I asked Mr. Jen to wait there until I went into the south court to call the Prices.
Man proposes, but God disposes. A Mr. Wang who had often come to the mission knew that we were planning to escape that night and saw me give my bundle to Mr. Jen. Thinking that it must contain some valuable things belonging to the Prices, an evil thought entered his heart. He watched when Mr. Jen laid the bundle in a small empty room close by the gate, and after he came out, Mr. Wang went into the room. Mr. Jen thought nothing of this, supposing that Mr. Wang was a friend. But in a minute he saw Mr. Wang rush out of the room, leap over the wall, and run away. Going at once into the room and not finding the bundle, he lost his head completely, and set up a loud wail. His one thought was that he had been faithless to his trust, and sitting down in the back gate which I had opened so secretly, he cried at the top of his voice, thus bringing to naught our carefully laid plans to escape. Up ran the four Yamen men and the soldiers from the street. Everyone in the compound appeared on the scene. When I heard his outcry I thought that he had received some serious injury. All gathered about him asking his trouble, but overcome with emotion he jumped up and down, slapping his legs and crying lustily. Finally he managed to say through his tears, "Mr. Fay [Fei], Mr. Wang has stolen the things which you gave me.
"When I heard this I could neither laugh nor cry nor storm at him. The Yamen men and soldiers at once picked up their lanterns and began to search. When they saw that the back gate had been unlocked and the stone removed, not knowing that I had done it, they began to scold and mutter:
"These things! How contemptible they are! When did they open this gate in order to steal the foreigners' things?"
As they muttered they locked the gate and replaced the stone, then left two men to guard it.
It was after midnight when this commotion was over, and every gate was guarded. Mr. Price and I saw that it would be impossible to get out that night. Even if we could leave the compound, we could not reach Deacon Wang's before daylight. If we attempted it, the Prices would not be saved, and Deacon Wang's whole family would be endangered.
So I went alone outside the compound to tell Mr. Han to dismiss the cart. As soon as he saw me, he said quickly:
"It is indeed well that the Prices have not come. I just came across several thieves, and was mistaken for one of their company. One of them said to me, 'If you get anything, you must divide with me.' If the Prices had come out, I fear they would have been killed."
The next day we consulted again about flight. Li Yii said:
"Let us flee all together to the mountains from thirty to sixty miles away."
So we hired a large cart and loaded it with food and other necessities, and sent it ahead of us into the mountains. Two Christian inquirers went with the cart to guard it. When it had entered the mountains about seven miles from the city, suddenly a man ran up and said to the inquirers:
"Run quick for your lives! Your mission in the city is burning, and the foreigners have all been killed."
As soon as they had jumped down from the cart and run away, rascals came up and stole all that was on the cart.
When we heard this we gave up all hope of escape, especially as we were told that bad men in the city had heard of our intention, and were hiding outside the city day and night ready to kill and rob the foreigners if they should appear. So we talked no more of fleeing, but committed our lives into the hands of our Heavenly Father, to do as seemed to Him best. We had little hope that we would be saved. Still we kept guard every night, Mr. Atwater and Mr. Lundgren being on duty the first half of the night, and Mr. Price and I the last half. At that time all of the servants had left us, and Mrs. Price did all the cooking, Mrs. Lundgren and Miss Eldred helping her. It was the hottest time in summer, and Mrs. Price stood over the stove with flushed face wet with perspiration. Li Y0 and I were so sorry for her, and wanted to help her, but alas! neither of us knew how to cook foreign food, so we could only wash the dishes and help to wash the clothes.
Li Yü was so helpful those days. He alone went outside the compound to see the Magistrate, to transact business, to purchase food, and every day to get the news.
August had come, and we were still alive. Could it be that God wishing to show His mighty power, would out of that whole province of Shansi save the missionaries at Fen Chou Fu and Tai Ku?The second day of August, a little after noon, a man came into our compound with the saddest story that our ears had heard during those sad summer days. He was Mrs. Clapp's cook, and two days before, in the afternoon, he had fled from the Tai Ku compound when flame and sword and rifle were doing their murderous work. As he fled he saw Mr. Clapp, Mr. Williams, and Mr. Davis making a last vain effort to keep back the mob of hundreds of soldiers and Boxers, and saw Mrs. Clapp, Miss Partridge, Miss Bird, and Ruth taking refuge in a little court in the back of the compound. Miss Bird had said to him as he ran:
"Be quick! be quick! "
Over the compound wall, then the city wall, he had taken shelter in a field of grain, where he still heard the howling of the mob and saw the heavens gray with smoke from the burning buildings. He hid in the grain until morning broke, then started on his journey to Fen Chou Fu.
So to our little company waiting so long in the valley of the shadow of death, came the tidings that our Tai Ku missionaries had crossed the river. Several native Christians who counted not their lives dear unto themselves, had gone with the martyr band. Eagerly I asked about my sister, her husband and child. The messenger did not know whether they were living or dead---only that they had been staying in the mission buildings outside the city. Two days later full accounts of the massacre reached us, and I knew that they were among the slain.
Bitter were the tears which we shed together that afternoon. It seemed as if my heart was breaking as I thought of the cruel death of those whom I loved so much, and whom I should never again see on earth. What words can tell my grief? I could not sleep that night, nor for many nights following. I thought how lovingly Mr. and Mrs. Clapp had nursed me through my long illness. I wept for Miss Bird, who had sympathized with me and helped me. "My dear ones, my dear ones, who loved and helped me as if I were your very flesh and blood, who brought so much joy and peace to the lonely one far from his home, who worked so earnestly for God, who pitied and helped the suffering and poor, would that I could have died for you! Could my death have saved one of You, gladly would I have laid down my life.
"The Tai Ku missionaries were gone, the Christians were killed or scattered, the buildings were all burned. We of Fen Chou Fu alone were left. We all thought that our day was at hand, but God still kept us for nearly two weeks. And now I want to tell you the story of those remaining days.
Last Days at Fen Chou Fu
The next day after we heard of the Tai Ku tragedy a man ran in to tell us that several hundred Boxers were coming from the east. They were those who had killed the missionaries at Tai Ku, and now they were resting in a village outside the east gate, prepared to attack our mission that afternoon. We all believed this report, for we were hourly expecting death. There was nothing the foreigners could do but to wait for the end. Mr. Price urged me to leave them at once and flee. Mr. Price, Mrs. Atwater, Mrs. Lundgren, and Miss Eldred all gave me letters to home friends. All of my foreign friends shook hands with me at parting, and Mrs. Atwater said, with tears in her eyes:"May the Lord preserve your life, and enable you to tell our story to others."Miss Eldred had prepared for herself a belt into which was stitched forty taels of silver. She thought that she was standing at the gate of death and would have no use for money, so she gave it to me for my travelling expenses. Mrs. Price gave me her gold watch and an envelope on which an address was written, and asked me to take the watch to Tientsin and find someone who would sent it to her father. Before I went out of the I gate I saw Mrs. Price holding her little daughter to her heart, kissing her through her tears, and heard her say:
"If the Boxers come today, I want my little Florence to go before I do."
My heart was pierced with grief as I saw the sad plight of my friends, but I could do nothing for them. Had I died with them it could not have helped them. So we parted with many tears.
While I was away the Magistrate had sent for Li Yü and demanded that all the firearms of the foreigners be given up to him. Li Yü replied, "I know the missionaries will use their weapons only in self-defense.
"The Magistrate was very angry, and ordered that Li Yü be beaten three hundred blows, with eighty additional blows on his lips because he had used the word 'I' in speaking to the Magistrate, instead of the humble "little one" which was customary. Li Yü was then locked in the jail, and the Magistrate sent men to the mission to demand the firearms. The missionaries could not refuse to comply, so their two shotguns and two revolvers were given up.
In this time of need two Christians named Chang and Tien came to help the missionaries. They worked for Mrs. Price to the last. The sufferings of the missionaries were indeed sore. Their patience and perfect trust in God greatly moved my heart. In the summer heat Mrs. Price three times a day hung over the stove preparing food for her family of ten, yet I never heard a word of complaint. Her face was always peaceful, and often she sang as she went about her work. One evening when we were all standing in the yard together Mrs. Price said to me:
"These days my thoughts are much on 'the things above.' Sometimes when I think of the sufferings through which my loved friends passed it seems as if a voice from heaven said to me, 'Dear sister, see how happy we are now; all of earth's sufferings are over, and if our sorrows on earth are compared with our bliss in heaven, they are nothing, nothing."'
Miss Eldred was very young, and had come from England only a year or two before, so she could speak little Chinese. The expression of her gentle face moved one to pity. When she was not helping Mrs. Price, she played outdoors with the three children, and gave Mrs. Price's little daughter music lessons.
We still patrolled the place at night, I continuing to take my turn with Mr. Price in the last half of the night. So I had an opportunity for forming a most intimate friendship with Mr. Price. He told me many things during those long hours, sometimes relating his own experiences when a soldier during the American Civil War.
Every day at sunset I played with Florence Price and Celia and Bertha Atwater. Ever since I had come to Fen Chou Fu I had played an hour with Florence. This had been good for both of us, for me because I learned English by talking with her, and for Florence because she had no children for companions and was very lonely. If there was a day when something prevented my going to her as usual, she would come or send for me. When Mr. Atwater moved to the same place his two little girls were very fond of romping with me too. I often carried the children on my shoulder, and they loved me very much. At seven o'clock, when their mothers called them to go to bed, all three would kiss me, saying: "Good-night, Mr. Fay, good-night. Pleasant dreams, pleasant dreams." So it was until the day when they left the earth.
At this time it seemed as if the Boxer trouble might be over. There were few rumors on the streets, and there had never been organized Boxer bands in Fen Chou Fu. So our hearts were more peaceful. Perhaps it was God's will after all to save our little band. Still no word reached us from the outside world. We walked on in the darkness. It was because of the friendliness of the Fen Chou Fu Magistrate that the little Christian community there was preserved so long after the floods of destruction had swept over every other mission in the province. His superior officer, the Prefect, a weak old man, died July 27. Upon the character of his successor might depend the life or death of the missionaries.
On August 12 the new Prefect appointed by the Governor arrived from Tai Yuan Fu. He was a man of great leaming but little practical ability, the tool of the Governor, who had sent him expressly to murder the foreigners. So he made their extermination his first business on reaching Fen Chou Fu. It was the 13th when he took the seals of office, and that same day he went to the Magistrate and upbraided him for his remissness in the work of massacre....
Outside the City Wall
It was a clear, beautiful day, with a gentle wind blowing, a bright sun shining, and not a cloud within sight. As we drove out of the gate we saw the streets packed with a dense crowd of spectators. From the mission to the North Gate of the city they seemed a solid mass, while house roofs and walls swanned with men and women eager for a sight of us. There were tens of thousands, and when we left the city gate behind, many flocked after us and stood watching until we were out of sight. So we left Fen Chou Fu on that fateful morning, August 15.
We had been imprisoned within walls for two or three months, and our hearts had all the time been burdened and anxious. Now suddenly we were outside the city in the pure, bracing air, in the midst of flowers and trees, luxuriant in summer beauty, riding through fields ripe for the harvest. It was all so beautiful and peaceful and strength-giving. So as soon as we were out in the country air our spirits rose and fresh life and joy came to us.
In the front of our cart sat Mr. Atwater with the carter, behind him were Mrs. Atwater and Mrs. Lundgren, and I sat in the back of the cart with the two little girls. On both sides, before and behind, walked the twenty soldiers, while in front of all, mounted on my white horse, with chin held high and a very self-satisfied manner, rode the leader. After ten o'clock the sun's rays grew warmer, and Mrs. Lundgren handed her umbrella to a soldier, asking him to offer it to the leader to shield him from the heat.
We talked as we rode along. Mrs. Lundgren remarked: "What a beautiful day it is!" Mrs. Atwater said, "Who would have thought that when we left Fen Chou Fu we would have such an escort?" "See the soldiers' uniforms, gay with red and green trimmings," said Mrs. Lundgren.
So the light conversation went on. Mrs. Atwater said to me, "I'm afraid they'll not give your horse back to you at P'ing Yao."
"I'm afraid not," I replied.
Then the two ladies tumed and talked in English with Mr. Atwater, and I talked and laughed with the two children close beside me. We played a finger game, and they prattled ceaselessly.
"Mr. Fay, please tell us where we are going," they said.
After a while little Bertha grew sleepy, and nestled to rest in her mother's arms.
When we left Fen Chou Fu we thought that we might meet Boxers or robbers by the way, but we said, "If any danger comes, these soldiers will protect us with all their might."
Little did we dream that these very soldiers were to murder us.
We passed through several villages, and every man, woman, and child was out to stare at us. Then we came to a large village. It was nearly noon and very hot, so we stopped to rest a while, and the carters watered their mules. A man happened to be there peddling little sweet melons. We were all thirsty, so we bought some, and as Mr. Atwater had no change handy I paid for them with the cash in my bag. We passed some back to those in the other cart, and Mrs. Lundgren took out a package of nice foreign candy and passed some to us. After a few minutes we were on our way again.
As we travelled the young soldier who had taken my horse away walked close behind my cart, never taking his eyes off me. I thought that he was angry because I had objected to giving him the horse, so I gave little attention to it. Then I noticed something strange in his way of looking at me, as if there was something he wished to say to me.
After we had gone on a little farther with the soldier walking behind the cart, still keeping his eyes on me, he heaved a great sigh, and said:
"Alas for you-so very young!"
The soldier walking at the side looked sternly at the speaker and said something to him which I could not hear, but I heard the reply:
"This is our own countryman, and not a foreigner."
When I saw the expression on their faces and heard these words, suddenly it flashed across me that they had some deep meaning, and I asked the young soldier what was up.
"I don't know," he replied.
"If anything is going to happen," I said, "please tell me."
He hung his head and said nothing, but followed still close to the cart, and after a while said to me plainly:
"You ought to escape at once, for only a short distance ahead we are to kill the foreigners."
I jumped down from the cart, but another soldier came up: saying, "Don't go away."Then I began to think it was true that the foreigners were to be killed, and wanted to get farther away from the cart, but the soldier who had first talked with me, said:
"You can't go yet; you must first leave your money with us."
I said, "I have only a little, barely enough for my joumey."
But I knew that they would not let me off without money, so I gave my watch to the soldier who had taken my horse. Another soldier demanded money, saying:
"If you have no money you may give me your boots."
So I took off my newly purchased boots and gave them to him putting on the well-worn shoes which he gave me in exchange. Another soldier took away my straw hat and the whip which I carried in my hand. It happened that at just this point a little pad branched off from the main road through a field of sorghum higher than my head. I started off on the path. While I had been talking with the soldiers Mr. Atwater had conversed with the two ladies and had not noticed our words. As I left my friends I took alas look at them, saying in my heart:
"I fear that I shall never again on earth see your faces."
I had no chance to speak to them, for the village where they were to be killed was only a quarter of a mile away, the carts had not stopped, and many people were following close behind. A crowd was also coming out from the village which they were approaching.
I had walked only a short distance on the little path when I heard footsteps following, and looking back saw that it was the two soldiers hastening after me. My heart stood still, for I thought that they were coming to prevent my escape and kill me. I did not dare to run, for they had rifles in their hands. Soon they overtook me, one seizing my queue and another my arm, and saying:
"You must have some money; we'll only let you escape with your life; your money must be given to us."
Before I had time to answer, the soldier snatched from my purse all the silver which Mr. Price had given me. I made an effort to get it back, but the soldier said:
"If we kill you, nothing will be yours.
If we let you escape with your life, should not your silver be given to us?"
There was some reason in their talk, so I only entreated them to leave me a little money, for I had many hundred miles to travel before I would reach my home. The soldiers had a little conscience, for dividing the silver between them they took out a small piece amounting to about a tael, and gave it to me.
The young soldier who had first talked with me said:
"Don't go far away yet. Wait until you see whether we kill the foreigners or not. If we don't do it, hunt me up and I'll give you your watch and all of your silver. If we kill them consider that we did not take your money without cause."
They then hurried back to the road.
When I had gone on a little farther I heard a loud rifle report. By that time I was almost convinced that they were indeed going to kill the foreigners. So I ran with all my might. It was about one o'clock and the sun beat down fiercely. After I had gone several miles I felt very weary, and though I was not afraid, my heart still fluttered and my flesh crept.
The sun was sinking westward, and I looked up to the sky with a sigh. The atmosphere was clear, wind and light were fair, and I asked myself:
"Can the great Lord who rules heaven and earth permit evil men under this bright heaven, in this clear light of day, to murder these innocent men and women, these little children? It cannot be. Perhaps I can still reach P'ing Yao, and look in the faces of those whom I love."
Then I thought that if the soldiers had really killed them in that village, as they said they would, they were no longer on the earth, but were happy with God. When this thought came I lifted my face toward heaven, saying:
"My beloved Mr. and Mrs. Price and other dear friends, if you are truly in heaven now, do you see my trouble and distress?"
So I walked on, my heart now in heaven, now on earth, a thousand thoughts entangling themselves in my bewildered mind.
I was weary and would walk a mile or two, then rest. I came to the bank of the Fen River, five miles from P'ing Yao, and waited some time at the ferry to hear what men were saying; for if the foreigners had not been killed they must certainly cross by this ferry, and everyone would be talking about it. But though I stood there a long time I heard no one mention the subject, and the dread that my friends had been killed took full possession of my heart. Then I crossed on the ferry with others, and strange to say the ferryman did not ask me for money.
Once across the river I reached a small inn outside the wall of P'ing Yao. I had walked twenty miles that day-the longest walk I had ever taken, and I threw myself down to sleep without eating anything. Often I awoke with a start and turned my aching body, asking myself, "Where am I? How came I here? Are my Western friends indeed killed? I must be dreaming."
But I was so tired that sleep would soon overcome me again.
The sun had risen when I opened my eyes in the morning. I forced myself to rise, washed my face, and asked for a little food, but could not get it down. Sitting down I heard loud talking and laughter among the guests. The topic of conversation was the massacre of foreigners the day before! One said:
"There were ten ocean men killed, three men, four women, and three little devils." Another added, "Lij Cheng San yesterday morning came ahead with twenty soldiers and waited in the village. When the foreigners with their soldier escort arrived a gun was fired for a signal, and all the soldiers set to work at once."
Then one after another added gruesome details, how the cruel swords had slashed, how the baggage had been stolen, how the very clothing had been stripped from the poor bodies, and how they had then been flung into a wayside pit.
"Are there still foreigners in Fen Chou FuT' I asked.
"No, they were all killed yesterday."
"Where were they killed?"
"In that village ahead-less than two miles from here," he said, pointing as he spoke. "Yesterday about this time they were all killed."
"How many were there?" I asked.
He stretched out the fingers of his two hands for an answer.
"Were there none of our people?"
"No, they were all foreigners."
My heart was leaden as I rode on the cart, with my face turned toward Fen Chou Fu. It was eight when the carter drove up to an inn in the east suburb of Fen Chou Fu, and I walked on into the city. Fortunately it was growing dark, and no one saw my face plainly, as, avoiding the main street, I made my way through alleys to the home of a Mr. Shih, a Christian who lived near the mission. When I knocked and entered Mr. Shih and his brother started up in terror and amazement, saying:
"How could you get here?"
We three went in quickly, barring the gate, and when we were seated in the house I told my sad story. Sighing, Mr. Shih said:
"We knew when the foreigners left yesterday that death awaited them on the road. Not long after you had gone the Prefect and the Magistrate rode in their chairs to the gate of the mission, took a look inside without entering, and then sealed up the gate."
Mr. Shih told me also how the Prefect, as soon as he had returned to his Yamen, had ordered Li Yü brought before him, and inflicted more cruel blows on his bruised body. Then he told details of the massacre. There was one young soldier named Li who had studied several years in the mission school, and whose sword took no part in the carnage. When the leader knew this he beat him from head to foot with his great horsewhip. The poor remains of the missionaries would have been left on the village street had not the village leaders begged that they be taken away. So the soldiers dragged them to a pit outside the city, where they found a common grave.
Source:
Luella Miner, Two Heroes of Cathay, (N.Y.: Fleming H. Revell,1907), pp. 63-128, quoted in Eva Jane Price, China Journal, 1889-1900 (N.Y.: Charles Scribner's Sons, 1989), pp. 245-247, 254-261, 268-274.
This text is part of the Internet Modern History Sourcebook. The Sourcebook is a collection of public domain and copy-permitted texts for introductory level classes in modern European and World history.
Unless otherwise indicated the specific electronic form of the document is copyright. Permission is granted for electronic copying, distribution in print form for educational purposes and personal use. If you do reduplicate the document, indicate the source. No permission is granted for commercial use of the Sourcebook.
© Paul Halsall, October 1998
Attributions
Adapted from:
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https://creativecommons.org/licenses/by-sa/4.0/
https://www.ibiblio.org/chinesehistory/contents/03pol/c03s02.html
https://creativecommons.org/licenses/by-nc-sa/3.0/
http://visualizingcultures.mit.edu/boxer_uprising/bx_essay02.html
http://visualizingcultures.mit.edu/boxer_uprising/bx_essay03.html
https://creativecommons.org/licenses/by-nc-sa/3.0/us/
Title Image
Yu Xunling, Court Photographer, Public domain, via Wikimedia Commons
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oercommons
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2025-03-18T00:36:47.114873
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Neil Greenwood
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"license": "Creative Commons - Attribution - https://creativecommons.org/licenses/by/4.0/",
"url": "https://oercommons.org/courseware/lesson/87938/overview",
"title": "Statewide Dual Credit World History, European Imperialism and Crises 1871-1919 CE, Chapter 10: Enlightenment and Colonization, Asian Colonization",
"author": "Anna McCollum"
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https://oercommons.org/courseware/lesson/87940/overview
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Colonization of India
Overview
Introduction
The British colonization provided a model of European colonization. The lessons that the British learned from the American colonization would prove to be important during the colonization of the Indian Subcontinent. The English were interested in gaining goods from the Indian colonial world. The English were interested in gaining a foothold in China. As the 19th century grew, the British became more and more interested in India as a site of resource and goods.
Learning Objectives
- Analyze the causes of the problems of the Mughal Empire before the British arrival.
- Evaluate the differences in the English colonization of South Asia and North America.
The Mughal Dynasty
The Mughal Dynasty is an important part to understanding how the British came to gain power in South Asia. Since the Middle Ages, Asia was one of the most important economic and political regions in the world. For many Europeans, the big goal of exploration was always to gain more of an economic footprint in China because of the trade goods. The reason the British were interested in India was the fact that it was a gateway to China and had been since the Middle Ages and Early Modern World, when Europeans attempted to integrate many Chinese resources into their own systems. Due to this trade China proclaimed itself the “Center of the World”; however, India was a periphery that was rich with resources as well. South Asia was also attractive to many Europeans because of the goods that could be procured there, and cotton was the chief among them. This led Britain to desiring control of the area, in one form or another.
During the Middle Ages, the Delhi Sultanate was the regional power in the subcontinent. The Delhi Sultanate began in 1206 CE when the Muslim kingdoms in the Pashtun region of modern Afghanistan invaded the Indian Subcontinent; this made the Sultanate an important trade partner for the region because the biggest export of the Delhi Sultanate was cotton—a material that is light weight and proved to be excellent as a material for textiles. This was the economic engine of the Delhi Sultanate that would reign for close to 300 years.
The problems that the Delhi Sultanate faced, at first, were mostly cultural. The major religion of the Indian Subcontinent in the Middle Ages was Hindu—the polytheistic religion that emerged in ancient India. The Delhi Sultanate was mostly Muslim. While it might be easy to point out the antagonisms that would be present in the modern world when a new religion is introduced through rulers, the introduction of Islam to the Indian Subcontinent was important but did not provide major difficulties for the Delhi Sultanate’s reign. The Delhi Sultanate, instead mostly suffered from the problem of integrating their wants to expand throughout the southern Deccan region of India and the abilities to pay for it.
The Delhi Sultanate was a conglomeration of princes and princely states that allied together with the sultan at the top of the political hierarchy. These princely states allied because of an economic promise made to them: every year, for the princes’ support, the sultan would increase the prince’s land holdings. At first, this arrangement was very suitable for both sides, because the Delhi Sultanate was to stay in the northern regions, where there was many great farmlands. The problem was, over 300 years, the northern region of India was conquered and brought into the Delhi Sultanate, which meant that there were no more lands easy to conquer in the Indian Subcontinent. The Himalayan Mountains that were to the north were a significant barrier and the region to the west was a desert; the eastern border was very difficult to move large armies through and would have been in direct conflict with China. This left moving south into the Deccan as the only real option for the Delhi Sultanate.
The problem that the Delhi Sultanate faced was the need to expand, but the location for expansion was incredibly costly and dangerous. The Deccan proved not ideal for military action; it was very hot, with limited resources for conquering armies, and indigenous populations were resistant to integration. Princely states, who found conquering the Deccan too costly, began to rebel, which significantly weakened the power of the Delhi Sultanate by the beginning of the 16th century.
As the Delhi Sultanate began to fracture, there was another group that was posed to take over. In the western regions of modern Afghanistan and Pakistan, there was a new kingdom that was beginning to emerge as a power center—a kingdom led by Babur. Babur (1483 – 1530 CE)—a direct descendant of Timur and Genghis Khan—was known as the first of the Mughal Emperors that would eventual come to rule all of India. He was a devout Muslim and approached colonization in a pragmatic fashion. Babur saw his opening as the Delhi Sultanate was weakening and decided that this was the proper time to launch an attack. He was successful in conquering the northern region of the Indian Subcontinent, as he was able to get aid from the Safavid and Ottoman Empires to successfully defeat the Delhi Sultanate.
Babur combined Persian culture and forces to create a successful empire that he reigned over for only a few years before he died at the age of 47 in 1530 CE. Babur reigned for a very short time and established the idea of treating Islamic and Hindu cultures the same. Babur was succeeded by his eldest son Humayun, who lost parts of Babur’s conquest in India. Humayun proved to have significant political problems and his death in 1556 CE elevated his son Akbar to be the next emperor.
Akbar (reigned 1556 – 1605 CE) is generally considered to be one of the best Mughal Emperors because of his ability to finally conquer the Deccan region, to stabilize the internal conflicts that plagued Humayun, and integrated the Hindu and Islamic populations together. One of the keys to Akbar’s success was his abilities to treat both the Muslim and Hindu populations as equals. If a Muslim population asked for money to build a mosque, Akbar gave the same amount of money to Hindu groups to build temples. This integration and treatment of both the Islamic and Hindi populations as equals meant that the Mughal Empire was built with integration in mind instead of division. This would be a foundational difference between the Mughal and the British colonizations. Akbar’s almost 50-year reign proved to be one of the most stable periods of the Mughal Empire. Following Akbar’s death in the early 17th century, the Mughal Empire saw significant problems with the leadership that caused direct consequences for the stability of the territory.
The next Mughal Emperor after Akbar was Jahangir (1605 – 1627 CE), who was a very powerful leader and military conqueror. Jahangir’s name meant “the world-conqueror” or “world-Seizer” in Persian. Jahangir was an important leader for the Indian subcontinent because he was powerful and united significant territory inside of the subcontinent, and he expanded the Mughal Empire in the southern reaches of the Deccan. The British became very interested in exploring and expanding their territorial empire in the Indian subcontinent in the early 17th century, and Jahangir kept a separation between the British and the Mughal Empire. He maintained a favorable relationship with the British while keeping the British at an arm’s length.
Jahangir’s son Shah Jahan also achieved territorial expansion and power in the Indian Subcontinent. Shah Jahan is known as the creator of the Taj Mahal, which was a mausoleum for his wife. The building of the Taj Mahal required many resources and demonstrated the wealth and power of the Mughal Empire of the time period. Shah Jahan was able to rule as an effective leader throughout the 17th century and saw the Mughal Empire grow in economic trading patterns with Europeans.
The end of Shah Jahan’s reign is very important to how the English grew their own empire in the Indian Subcontinent. Shah Jahan became intensely focused on honoring and developing the Taj Mahal and this took so much of his resources and time that in the last few years of his reign he did not focus on other rising issues. At the same time, the English were very interested in growing their political and economic interests on the Indian Subcontinent and other European powers were trying to take over the subcontinent as well. With Shah Jahan’s focus on the development and integration of the Deccan region in Southeastern Asia and on the Taj Mahal, European powers, such as Portugal and Holland (the Dutch), were able to gain access and attempt to develop positions of power on the subcontinent. The Portuguese and Dutch were two of the key traders on the Indian Subcontinent at the time.
As Shah Jahan was slowly loosing power in his last years, his two sons, Aurangzeb and Dara were vying for power. Dara was Shah Jahan’s favorite son, a courtly individual who had limited success on the battlefield. Aurangzeb was a highly decorated military leader with significant experience in battles and leadership. Aurangzeb and Dara began fighting between one another; this eventually led to Aurangzeb ordering his men to have brought Dara’s head to him as proof that Dara was dead. Shah Jahan witnessed Dara’s head being delivered to Aurangzeb and passed out.
Aurangzeb is often thought of as the last significantly important political leader of the Mughal Empire. The power of Aurangzeb was very important to the Indian subcontinent. The economic and political growth of the Mughal empire was very important during this period, as new markets provided a positive expansion of Mughal products. But there were three decisions that Aurangzeb made that had a deep impact on the Mughal Empire, and subsequently the British colonization of India. The first was that Aurangzeb was instrumental in expanding southward to the Deccan region; this was an important test of the alliance system that the Mughal empire had integrated from the Delhi Sultanate and meant that Aurangzeb was constantly at battle and needed significant funds for these expeditions. The second consequential decision that Aurangzeb made was the push for more Muslims in the Indian Subcontinent by conversion; this would mean that the Muslim population of 31% would grow significantly, as well as a push back from the Hindu population that felt threatened by this new goal of Aurangzeb. The Mughal Empire long rested their political and social integration of Islamic and Hindi populations together, and this was a direct challenge that would prove to be a major change in those relationships that the British would further exploit in their conquests. The third consequential decision of Aurangzeb was allowing the British to maintain and integrate positions of power on the Indian Subcontinent. Aurangzeb was so centered on his own conquests that the British requests for establishing bases and regions of power were granted as almost an afterthought. By allowing the British to establish forts and trading posts in cities, he allowed the British to leverage those political and economic power situations for their own purposes. This would give them a home base in which to trade further.
In response to Aurangzeb’s permissions, the British quickly established the cities of Calcutta and Bangladesh. These two centers of trade would have economic consequences because the British were not only establishing trading posts, but these became militarized area, complete with fortresses. The militarization was a very important part of how the British would become a regional territorial power as the Mughal Empire disintegrated more and more following Aurangzeb’s rule.
The leaders following Aurangzeb had many problems, mostly they lacked the political and military experience to fight back against other regional powers and address the growing British foothold. Following Aurangzeb’s death there was a political struggle between Aurangzeb’s sons and Shah Jahan’s sons; the consequence was a politically divided and fractured Mughal Empire. The resulting chaos meant that there were two noblemen brothers—Husain and Hasan Ali—who were interested in getting more political power. This struggle for power went as far as hiring assassins to kill the Mughal Emperors.
As the Mughal Empire slowly started to devolve with internal political turmoil, outsiders saw their opening to attack and gain political power for themselves. Farrukhsiyar was a Persian prince who wanted to gain a part of the Mughal Empire’s political power. Farrukhsiyar invaded the subcontinent and was welcomed by the Ali brothers. Farruksiyar was successful and would be a long serving emperor in the Indian subcontinent, although he was controversial at the time because he promoted the Sunni faith on the subcontinent. The British East India company also gained more political power in the region when Farruksiyar gave them a formal right to reside and trade in the Mughal Empire and gave them a yearly payment. Following Farrukhsiyar, political and economic turmoil increased in the Mughal Empire, resulting in a more direct challenge by the British East India Company.
Like the American colonization by the British, at the center of their initial reasons for being in the region were purely economic. Many of the early British merchants were at the outskirts of Indian society, and they were looking to gain goods and resources to bring back to the English countryside. These goods included cotton and spices. Cotton was the backbone of the transformation of the English textile industry and the earliest seeds of industrialization. These British merchants originally suffered what they perceived as unfair and unequal laws because the taxes by the Mughal Empire were significant and the Mughal Empire did not allow for many British merchant trade rights. When Aurangzeb allowed the British to trade on the subcontinent and build fortresses in Calcutta and Bangledesh, this allowed the British began to expand their trade and push the Portuguese out of their trading posts in the subcontinent. The British merchants also attempted to stop their French rivals from having trade access but did not accomplish this during the Mughal Empire.
While the British East India Company was formed in 1600 CE, Indian Subcontinent merchants quickly became the central force of power. As the political turmoil at the top of the Mughal Empire started to become clear to the British, the merchants began to band together and reform the British East India Company. The British East India Company maintained a formal monopoly on the goods leaving India by British ships, this was almost 15% of all British imports from India came through this company. English Parliament gave these rights because many of the members held stock from the company and directly benefitted from the trade monopoly that was quickly forming. Additionally, the British merchants quickly became interested in expanding their footprint beyond simply trade goods and started making deals with the local governors for tax collection, which enriched their ability to further their impeding colonization.
Throughout the 18th century, the British East India Company gained more and more power on the Indian Subcontinent. The British forces began harassing and pushing against the French traders that were in the region. A conflict that would be resolved with the Seven Years War in the middle of the 18th century. The British East India Company was increasingly fearful of the political unrest and began to formulate a plan of action, in case of collapse of the Mughal Empire. The key event that crystalized the transition of power was when forces of the Mughal Empire arrested and held over 140 British individuals in a Calcutta jail cell known as the “Black Hole,” where almost 120 of these individuals died. This was the last straw for the British East India Company, and they began to buy arms and soldiers.
The British East India Company developed a standing army and pushed back the Mughal Empire. It is important to note that this is a company that developed a military force to fight the Mughal Empire, not a formal government. This occurrence is very strange and demonstrates how important the British East India Company was to the presence of the British in the subcontinent. The British East India Company became highly successful in establishing a basis of political power that rested on having the military to support the company.
Enlightenment Approaches-Hasting vs Cornwallis
The British had two different approaches to the formation of the colonization of India. The first was Lord Hasting's approach, focusing on the Enlightenment and how to engage populations from a historical background. The second approach was Cornwallis, who had a different manner of colonization that had a problem of economics. These two leaders had a profound impact on the future of the Indian Subcontient.
Learning Objectives
- Evaluate the differences between Hastings and Cornwallis approach to colonization.
- Evaluate the impact of Cornwallis’s engagement with the Indian Subcontinent and how this created social and political differences in the subcontinent.
- Evaluate the Indian Civil Service and its importance to the Indian Subcontinent.
- Analyze the impact of the Enlightenment on the British Indian colonization.
The British East India Company Raj
Today India and Pakistan are two important countries in South Asia, yet, in many ways they are enemies of one another. While there is a deep history that is complex, in many ways the origin point of the antagonism between these two states started in the 19th century with the rise of Warren Hastings and Charles Cornwallis as the British officers in charge of the subcontinent. These two leaders fundamentally reshaped the relationship between the Hindu and Islamic populations in South Asia, and that would have a direct result on the conflict that arose between India and Pakistan. To better understand these two men, an examination of the British East India Company is important, especially as it was rising to power in the late 18th century.
Early Operation
Between 1601 and 1608, four voyages instigated the British establishment of trade with the East Indies. Initially, the British East India Company struggled in the spice trade because of the competition from the already well-established Dutch East India Company. The East India Company (EIC or the Company) opened a factory in Bantam on the first voyage. Imports of pepper from Java were an important part of the Company’s trade for 20 years. In the next two years, it established its first factory in south India in the town of Machilipatnam in Bengal. The high profits reported by the Company after landing in India initially prompted King James I to grant subsidiary licenses to other trading companies in England. But in 1609, he renewed the charter given to the EIC for an indefinite period, including a clause that specified that the charter would cease if the trade turned unprofitable for three consecutive years.
English traders frequently engaged in hostilities with their Dutch and Portuguese counterparts in the Indian Ocean. The Company decided to explore the feasibility of gaining a territorial foothold in mainland India with official sanction from both Britain and the Mughal Empire, and requested that the Crown launch a diplomatic mission. In 1612, James I instructed Sir Thomas Roe to visit the Mughal Emperor Nuruddin Salim Jahangir to arrange for a commercial treaty that would give the Company exclusive rights to reside and establish factories in Surat and other areas. In return, the Company offered to provide the Emperor with goods and rarities from the European market. This mission was highly successful.
Expansion
The Company, which benefited from the imperial patronage, soon expanded its commercial trading operations, eclipsing the Portuguese Estado da Índia, which had established bases in Goa, Chittagong, and Bombay. Portugal later ceded this land to England as part of the dowry of Catherine de Braganza—Charles II’s wife. The EIC also launched a joint attack with the Dutch United East India Company on Portuguese and Spanish ships off the coast of China, which helped secure their ports in China. By 1647, the company had 23 factories and 90 employees in India. The major factories became the walled forts of Fort William in Bengal, Fort St George in Madras, and Bombay Castle. With reduced Portuguese and Spanish influence in the region, the EIC and Dutch East India Company entered a period of intense competition, resulting in the Anglo-Dutch Wars of the 17th and 18th centuries.
In an act aimed at strengthening the power of the EIC, King Charles II granted the EIC (in a series of five acts around 1670) the rights to autonomously acquire territory, mint money, command fortresses and troops and form alliances, make war and peace, and exercise both civil and criminal jurisdiction over the acquired areas. These decisions would eventually turn the EIC from a trading company into a de facto administrative agent with wide powers granted by the British government.
Monopoly
The prosperity that the officers of the Company enjoyed allowed them to return to Britain and establish sprawling estates and businesses and obtain political power; this allowed the Company to develop a lobby in the English parliament. Under pressure from ambitious tradesmen and former associates of the Company, who wanted to establish private trading firms in India, a deregulating act was passed in 1694. This allowed any English firm to trade with India unless specifically prohibited by act of parliament, thereby annulling the charter that had been in force for almost 100 years.
By an act passed in 1698, a new “parallel” East India Company (officially titled the English Company Trading to the East Indies) was floated under a state-backed indemnity of £2 million. The two companies wrestled with each other for a dominant share of the trade over a period of some time, both in England and in India. But it quickly became evident that in practice, the original company faced scarcely any measurable competition. And the companies merged in 1708 by a tripartite indenture involving both companies and the state. Under this arrangement, the merged company lent to the Treasury a sum of £3,200,000 in return for exclusive privileges for the next three years, after which the situation was to be reviewed. The amalgamated company became the United Company of Merchants of England Trading to the East Indies.
With the advent of the Industrial Revolution, Britain surged ahead of its European rivals. Britain’s growing prosperity, demand, and production had a profound influence on overseas trade. The EIC became the single largest player on the British global market. Following the Seven Years’ War (1756 – 63) and the defeat of France, French ambitions on Indian territories were effectively laid to rest, thus eliminating a major source of economic competition for the EIC. The Company, with the backing of its own private well-disciplined and experienced army, was able to assert its interests in new regions in India without facing obstacles from other colonial powers, although it continued to experience resistance from local rulers.
Changing Political Role
The EIC began to function more as an administrator and less as a trading concern over the hundred years from the Battle of Plassey in 1757—in which the EIC defeated the ruler of Bengal Nawab and his French allies, which allowed them to consolidate the Company’s presence in Bengal—to the Indian Rebellion of 1857.
The proliferation of the Company’s power chiefly took two forms. The first was the outright annexation of Indian states and subsequent direct governance of the underlying regions, which collectively comprised British India. The second form of asserting power involved treaties in which Indian rulers acknowledged the Company’s hegemony in return for limited internal autonomy. In the early 19th century, the territories of these princes accounted for two-thirds of India. When an Indian ruler who was able to secure his territory wanted to enter such an alliance, the Company welcomed it as an economical method of indirect rule that did not involve the economic costs of direct administration or the political costs of gaining the support of alien subjects. In return, the company pledged to defend its allies.
One of the key individuals in the transformation of the British East India Company was Sir Robert Clive (1725 – 1774 CE). Robert Clive was a British writer for the East India Company and became a military leader. Clive rose quickly in rank and at the Battle of Plassey was the winner. As a result, the British East India Company gave Clive the title of the first British Governor of the Bengal Presidency. One of the key ways that Clive won was supporting the overthrow of local nawabs over others and this helped to destabilize the region. Clive was notorious for offering weapons and money to local leaders for their support. If those local leaders did not return the wants of Clive, he would turn to their second in command in the area and offer the same deal to help destabilize the region. This is what led to the death of the nawab Mir Jafar. Furthermore, Clive took the funds earned from securing the trade in the region and pushed them through the Dutch East India Company to avoid taxes and penalties in England, worth several million dollars in British pounds in today’s money. Clive would become one of the most controversial figures in the British East India Company, earning more money through illegal means while also helping to kill people in the Indian Subcontinent.
These events together demonstrate the main issues with the British East India Company: the British were not clear about their goals or involvement in the subcontinent nor did they attempt to built clear rules to help the indigenous populations.
The next problem the British faced was how to govern such a region with their newly acquired political power. While the British East India Company was a military power, after the conquest, it also became a government. Governments are traditionally elected and have localized power, and they often rest/revolve around the needs of the people that they are serving. The British East India Company was a stock investment company that was responsible to the needs and wants of the stockholders in England, not the people of the Indian subcontinent.
From 1757 – 1856 CE, the British East India Company was in charge as the only political power in the region, and they were responsible for changing many parts of the Indian Subcontinent; this time period is known as the British East India Raj. The British East India Raj did not build much infrastructure, nor did it help the indigenous people of India; instead it made many laws about the way that Indian populations were allow to plant crops, restricting the cultivation of many food crops while demanding more cotton be planted.
The British East India Company was interested in extracting as many resources as they could from the subcontinent. And one of the most significant trade crops grown in South Asia was cotton. The Indian subcontinent was home to many of the world’s richest cotton fields and most important ones at that. Indian cotton had become famous with Dutch traders in the 16th century. Many of the reasons that cotton was so fashionable during this time period is the same reason that many of our clothes today are made of cotton, because of ease of use and dying for colorful and intricate designs. By the 18th century, many Europeans wanted this important fabric. Because cotton needs warmth and water to be successful, a climate trait that England does not fully possess, the product had to be obtained from India or other regions of the world. Cotton production soared in the late 18th century and would become one of the central imports for the British East India Company.
This relationship created a key to understanding the policies that the British would impose on future colonies and the imperialist period.
Hastings as Governor General
Warren Hastings had an outsized impact on the future of the British East India Raj. Hastings was born in England in 1732 to a poor gentleman. After getting an education, he joined the British East India Company in 1750 as a clerk and sailed to India, eventually going to Calcutta. His early experiences and education were deeply engrained in the Enlightenment, which provided a key model of the historical and political for Hastings. One of the most important concepts of the Enlightenment that Hastings would come to incorporate was the idea of rationality and the role of history to establish rule. This would prove very important to Hastings’s future as a governor.
Hastings was fascinated by Indian Subcontinent history and enjoyed learning about the past. Then, Hastings won promotion in 1752 and was sent to a major trading post in Bengal. It was here that Hastings was a part of the members that were locked up in the infamous “Black Hole of Calcutta,” where a garrison and civilians were jailed by the Mughal government and many died during one night in jail. Following this traumatizing event, Hastings would continue to expand and understand more of Calcutta.
In 1757 after British forces were pushed back from Calcutta, Hastings served under Robert Clive and helped to recapture the city. Hastings understood the importance of relationships between the British and Indian forces and made friends with local Nawabs. All the while, Hastings would relay information about the indigenous forces and their movements to his superiors with the intent of enabling the British to gain political and economic power in India.
Hastings pushed for the British as tax collectors on behalf of the Mughal Empire. This would prove the most beneficial because the British were able to collect official money for the Mughals, and they could easily hide their gains from the system.
As Hastings’ work became more central to the British East Indies Company, it was clear that he would start to lead the organization on the Subcontinent. In 1773 Hastings became the governor general of India for the British East Indies Company, the leader in charge of the British forces. This would prove to be a very important position because Hastings was a clear leader and saw the importance of history as a governor.
As leader, Hastings attempted to integrate many of the Enlightenment ideas into India as he could. By the time of his leadership, Hastings had become fluent in Persian and Urdu, making him suitable to read and write in the ancient texts of the subcontinent. Hastings read about the advancements of the Indian civilizations in the Mohenjo-daro region and was fascinated by the two “golden eras” of India in the ancient world. Hastings felt there had to be a logical reason that India was wealthy and powerful throughout the ancient world during that golden period, and he felt that India had fallen into a “dark period” under the rule of the Mughal Empire. Using the ideas of rationality from the Enlightenment, Hastings began to incorrectly theorize that the problem that caused India to fall from a propseperous time was the arrival of Islam on the subcontinent. While this was an incorrect assumption, it proved damaging to the subcontinent.
Hastings began to create policies that started favored Hindu populations, at the expense of Muslims. He pushed for the continuation of the caste system and for the return to the religious laws of the ancient world. These policies would result in slightly better jobs for the Hindi populations than their Islamic counterparts.
Hastings also established the Indian Administration Service, the government of British India that would guide the administration of the British East India Raj. This would prove fateful because the policies that Hastings established would continue to grow throughout the British East India Raj.
In 1785, after ten years of service to the British East India Company, Hastings resigned and returned to India. Upon his arrival in England, he was arrested and impeached by the House of Commons for alleged crimes and misdemeanors, such as embezzlement, extortion, coercion, and the alleged killing of a local leader; these totaled to twenty criminal counts against Hastings. Many of the actions on which these charges were based were common to the British East India Company, and they would not have been out of bounds in the empire. But the British Parliament wanted to make an example out of Hastings, who was a member of the opposition of members such as Edmund Burke. Hastings was eventually acquitted in 1795 and he would retire to Scotland to live his remaining life. Yet, the importance of Hastings’s policies would influence the next leader of the British East Indies Company: Charles Cornwallis.
Cornwallis as Governor General
The next leader of the British East Indies Company was Charles Cornwallis, who was born in 1738 in London to a upper class family. Charles was educated at Cambridge and would eventually join the military and travel Europe with military officials, while learning about tactics. In 1760 he became a member of the House of Commons and voted against the Stamp Act. Cornwallis was a very unique man in history, because many American historians know him as the last of the British generals in the American Revolution. However, despite his defeat in the American Revolution, Cornwallis continued to gain the confidence of Parliament. In 1782 he returned to England and was paraded as a hero. By 1785, it was clear that Hastings was going to leave his post as the Governor General of India and the British Parliament wanted a clear leader, which is what they saw in Cornwallis.
Cornwallis is known for making significant reforms to the Civil Service of India and establishing several key institutions that would create issues between the different cultural groups on the Indian Subcontinent. The Indian Civil Service was significantly understaffed and had many problems with management. And one of the key issues that arose was due to the fact that the British East Indies Company wanted written correspondence in English. Not many people on the Indian subcontinent could write effectively in English. Cornwallis decided one of the key ways to get English speakers was to offer positions to those in London and England. But these jobs were often considered low level administration jobs and paid very little. Therefore, the positions were left unfilled or had to be filled by people who did not understand English as well as they would need to. Consequently, when Cornwallis opened these positions to those of the Indian subcontinent a key change happened. Cornwallis started to hire local individuals with skills and talent to run the Indian Civil Service. This is important because his hiring decisions were colored by Hastings’s promotion of Hindu populations over that of Islamic populations. And this situation is the key to understanding how these misaligned policies would cause direct consequences for the population of the Indian Subcontinent. Because well paying and high political positions were going to largely Hindi speaking cultural groups, a very distinct rift between the Hindi and Islamic populations on the Indian Subcontinent was created.
Because British policies discriminated against the Muslim populations of the Indian Subcontinent, many Muslims reacted in a significant ways against these policies. The Islamic populations began questioning Cornwallis’s approach and leadership. Cornwallis reacted to this questioning by encouraging Muslims to seek government jobs in the Indian Army. Unfortunately, the positions offered were mostly low-ranking and low-paying, such as soldiers. Many of the Muslims simply became “canon fodder,” and it was very clear the implications of Cornwallis’ goals.
Cornwallis would divide the Indian Subcontinent even further when he instituted laws and administration barriers that benefitted the Hindu populations over Muslims. Cornwallis demanded that the Hindi laws be translated to English for administrative selection on which laws to use. These collectively became known as the Cornwallis Code, which would institutionalize the discriminatory policies against Muslims.
Cornwallis also changed the way that taxes were collected in the subcontinent, creating a problem for landowners and tenants. Many of the landowners were originally Muslims, this would prove to be a significant problem because it caused many of these landowners to go bankrupt and forced them to sell lands, stripping away political and economic power of Muslims in the Indian Subcontinent. This would create a social and political imbalance in the Indian Subcontinent that would continue to divide and grow deeper between the Islamic and Hindi populations.
While it was not the original goal of either Hastings or Cornwallis, the social divisions that emerged between the Hindu and Muslim populations proved to be Colonization 2.0. European colonists would find ways to further divide those populations who already were experiencing cultural differences, and they did this as a means of gaining more power. This type of colonization was very different than the first version of colonization in the 15th to early 19th centuries, where Europeans went to regions around the world and would establish direct bases of political and economic power. The second wave colonization focused more on exploiting and removing goods from regions. This model of colonization can be seen in other regions, such as China, many of the African states in the 19th century, and Southeast Asia. By creating this social and political imbalance, it created opportunities for the British to expand their own political and economic power in the colony.
The Steel Frame of India
The reforms that Cornwallis enacted were incredibly important. Through his reforms he permanently altered the system of political power in India. By encouraging certain populations on the subcontinent to do certain jobs, Cornwallis deepend the social rift that was emerging. The use of the Indian Civil Service was one of the most important in the time to create a bureaucracy of the British government in India. The reforms were to create a government of 250 districts in British India that were to be the government of India. This was every government service from local administration to the colonial world total. This meant that all political power was in the English hands.
The Indian Civil Service government activities were conducted in English. Business conducted in English was a significant problem for the colonial world, because English speakers were limited. This meant, because of reform policies that were encountered in the earlier Cornwallis and Hasting’s administration, would heavily favor those of the Hindu population over that of Muslims. Lawyers and administrators that worked in the administration began to trend towards Hindu populations in the middle to late 19th century. These were high paying jobs and would constitute an economic imbalance in the subcontinent favoring Hindu populations.
The Army was another component of the Indian Civil Service, which was mostly comprised of Muslim workers. These job differences were stark. While the Hindu favored positions were mostly office based, the problem with the Army was that this was dangerous and often deadly work. This would be compounded by the terrible pay that soldiers were given. The quality of life for many in the British Army was not good. This highlights the difference in the Hindu and Islamic world treatment by the British government.
The British went further than just economic and political reforms, they began to make policies as an empire that also hurt many of the constituents inside the Subcontinent. One of the biggest issues that the British faced was their use of what were deemed as the Home Charges. The Home Charges were the British telling India that the British were not in control of the territory, but simply advisors to the Indian Civil Service. As such, the Indian Subcontinent had to pay the British government for their administrative advising. It is important that the British held all the political, economic, and social power in the Indian Subcontinent following the British East India Company taking over in the early 17th century. The Home Charges were nothing more than a way to exploit and get as much money and wealth from the Indian Subcontinent as they could. This is compounded by the administrations use of laws towards growing and regulations on the economics of the colony as well.
Bengal: The Safety Zone for England
The English became deeply invested in Bengal because of their fears that other European empires, especially the French, would encroach on their territory and space in the region of India.
Learning Objectives
- Analyze the British empire’s views of Southeast Asia.
- Evaluate the role of Southeast Asia in the British colonial administration.
Indochina
Indochina, originally Indo-China, is a geographical term originating in the early 19th century for the continental portion of the region now known as Southeast Asia. The origins of the name Indo-China are usually attributed jointly to the Danish-French geographer Conrad Malte-Brun, who referred to the area as indo-chinois in 1804, and the Scottish linguist John Leyden, who used the term Indo-Chinese to describe the area’s inhabitants and their languages in 1808. The name refers to the lands historically within the cultural influence of India and China and physically bound by India in the west and China in the north. It corresponds to the present-day areas of Myanmar, Thailand, Laos, Cambodia, Vietnam, and (sometimes) peninsular Malaysia. The term was later adopted as the name of the colony of French Indochina (today’s Vietnam, Cambodia, and Laos), and the entire area of Indochina is now usually referred to as the Indochinese Peninsula or Mainland Southeast Asia.
Greater India
In the pre-modern era, significant parts of the region that would later become French Indochina belonged to what is known as Greater India. Although the term is not precise, Greater India is most commonly used to encompass the historical and geographic extent of all political entities on the Indian subcontinent, as well as, to varying degrees, the area that had been transformed by the acceptance and induction of cultural and institutional elements of pre-Islamic India. Since around 500 B.C. Asia’s expanding land and maritime trade resulted in prolonged socioeconomic and cultural stimulation and diffusion of Hindu and Buddhist beliefs into a regional cosmology, particularly in Southeast Asia and Sri Lanka. The kingdoms that belonged to Greater India and eventually overlapped with what would become French Indochina were Funan and its successors Chenla, Champa, and the Khmer Empire.
Champa controlled what is now south and central Vietnam, starting about 192 CE. The dominant religion there was Hinduism, and the culture was heavily influenced by India. By the late 15th century, the Vietnamese—descendants of the Sinic civilization sphere—conquered the last remaining territories of the once powerful maritime kingdom of Champa.
Between the 3rd and the 5th centuries, Funan and its successor, Chenla, coalesced in present-day Cambodia and southwestern Vietnam. For more than 2,000 years, what was to become Cambodia absorbed influences from India, passing them on to other Southeast Asian civilizations that are now Thailand and Laos. The Khmer Empire, with the capital city in Angkor, grew out of the remnants of Chenla, firmly established in 802 when Jayavarman II declared independence from Java. He and his followers instituted the cult of the God-king and began a series of conquests that formed an empire, which flourished in the area from the 9th to the 15th centuries. Additionally, around the 13th century, monks from Sri Lanka introduced Theravada Buddhism to Southeast Asia. The religion spread and eventually displaced Hinduism and Mahayana Buddhism as the popular religion of Angkor.
After a long series of wars with neighboring kingdoms, Angkor was sacked by the Ayutthaya Kingdom and abandoned in 1432 because of ecological failure and infrastructure breakdown. This led to a period of economic, social, and cultural stagnation when the kingdom’s internal affairs came increasingly under the control of its neighbors. The period that followed is today known as the Dark Ages of Cambodia—the historical era from the early 15th century to 1863, which is the year that marks the beginning of the French Protectorate of Cambodia. As reliable sources from this period are very rare, a fully defensible and conclusive explanation for the decline of the Khmer Empire, recognized unanimously by the scientific community, has so far not been produced.
In the 19th century a renewed struggle between Siam and Vietnam for control of Cambodia resulted in a period when Vietnamese officials attempted to force the Khmers to adopt Vietnamese customs. This led to several rebellions against the Vietnamese and appeals to Thailand for assistance. The Siamese-Vietnamese War (1841 – 1845) ended with an agreement to place Cambodia under joint suzerainty; this later led to the signing of a treaty for French Protection of Cambodia by King Norodom Prohmborirak.
British In Southeast Asia
Many of the problems with the British approach to Southeast Asia revolve around their conception of empire. The British were heavily invested in the growth of India. This can be seen in the descriptions of India as the “Crown Jewel” of the British Empire. The British understood that their economic and political success rested in the role of India as their main colony. Yet, the British were not alone in their perspectives of growing an empire in the region and this would cause direct problems with others in the area.
In the late 17th century, the British successfully pushed to control the majority of the Indian Subcontinent with the intent to control trade in the region, with the goal of replacing or subduing the Dutch settlers and traders that arrived before them. Throughout the 18th century, the British East India Company remained on guard against other European powers that were interested in India. The fear was that France or Spain would get a powerful hold on the very profitable subcontinent, which would end with another power struggle between the European nations. This is the reason that the English demanded the French be expelled from the Indian Subcontinent at the end of the Seven Years War, and the Treaty of Paris (1763) ensured that happened.
Regardless of law, the French still wanted to have a presence in and still attempted to move into the subcontinent. The French would establish colonies in the far Southeast Asia, in places like Laos, Cambodia, and Vietnam in order to get a toehold in the region; this worried the British, who felt the proximity of the French colonies to the English colonial world was a very big problem.
Bengal
Bengal is part of current day Bangladesh, which means it borders India on the east side. But in 1805 Bengal was the term used for a large swath of territory to the east of the Maratha Territory (or the bulk of what is now India). This means that geographically it would make sense as a point of entrance into the region for any invaders approaching from the east, where the bulk of French colonies in the region were.
The British solution of the French colonial proximity was to establish a new colony of Bengal. The British were not interested in establishing a long term colonial hold on Bengal, but instead focused on this as a buffer colony. If the French did decide to invade the region, that it would be Bengal that would be invaded. The British decided that this was a sacrifice that they were willing to make, a sacrifice of the Bengal people. Obviously, this was a terrible solution. The Bengali people were obviously not desirous of serving as a war front for England; furthermore, the recent major draught had deeply affected Bengal. Moreover, the British presence in Bengal also increased tensions in the colony between the Muslims and the Buddhists that were in the colony and fell subject to the British colonial policies that favored Hindus.
Primary Source: Sir Robert Clive The Battle of Plassey
Sir Robert Clive's Account of the Battle of Plassey
I gave you an account of the taking of Chandernagore in my last letter; the subject of this address is an event of much higher importance, no less than the entire overthrow of Nabob Suraj-ud-Daulah, and the placing of Meer Jaffier on the throne. I intimated in my last how dilatory Suraj-ud-Daulah appeared in fulfilling the articles of the treaty. This disposition not only continued but increased, and we discovered that he was designing our ruin by a conjunction with the French.
About this time some of his principal officers made overtures to us for dethroning him. At the head of these was Meer Jaffier, then Bukhshee to the army, a man as generally esteemed as the other was detested. As we had reason to believe this disaffection pretty general, we soon entered into engagements with Meer Jaffier to put the crown on his head. All necessary preparations being completed with the utmost secrecy, the army, consisting of about one thousand Europeans and two thousand sepoys, with eight pieces of cannon, marched from Chandernagore on the 13th and arrived on the 18th at Cutwa Fort. The 22nd, in the evening, we crossed the river, and landing on the island, marched straight for Plassey Grove, where we arrived by one in the morning.
At daybreak we discovered the Nabob's army moving towards us, consisting, as we since found, of about fifteen thousand horse and thirty-five thousand foot, with upwards of forty pieces of cannon. They approached apace, and by six began to attack with a number of heavy cannon, supported by the whole army, and continued to play on us very briskly for several hours, during which our situation was of the utmost service to us, being lodged in a large grove with good mud banks. To succeed in an attempt on their cannon was next to impossible, as they were planted in a manner round us, and at considerable distances from each other. We therefore remained quiet in our post. . .
About noon the enemy drew off their artillery, and retired to their camp. We immediately sent a detachment, accompanied by two field-pieces, to take possession of a tank with high banks, which was advanced about three hundred yards above our grove, and from which the enemy had considerably annoyed us with some cannon managed by Frenchmen. This motion brought them out a second time; but on finding them make no great effort to dislodge us, we proceeded to take possession of one or two more eminences lying very near an angle of their camp. They made several attempts to bring out their cannon, but our advance field-pieces played so warmly and so well upon them that they were always driven back. Their horse exposing themselves a good deal on this occasion, many of them were killed, and among the rest four or five officers of the first distinction, by which the whole army being visibly dispirited and thrown into some confusion, we were encouraged to storm both the eminence and the angle of their camp, which were carried at the same instant, with little or no loss. On this a general rout ensued; and we pursued the enemy six miles, passing upwards of forty pieces of cannon they had abandoned, with an infinite number of carriages filled with baggage of all kinds. It is computed there are killed of the enemy about five hundred. Our loss amounted to only twenty-two killed and fifty wounded, and those chiefly sepoys.
Source:
From: Oliver J. Thatcher, ed., The Library of Original Sources, (Milwaukee: University Research Extension Co., 1907), Vol. VII: The Age of Revolution, pp. 59-64.
Scanned by: J. S. Arkenberg, Dept. of History, Cal. State Fullerton. Prof. Arkenberg has modernized the text.
Attributions
Attributions
Images courtesy of Wikimedia Commons: New Indian Military: https://upload.wikimedia.org/wikipedia/commons/9/96/Indian_Army_troops_in_winter_clothing%2C_Iran%2C_1944_%28c%29.jpg
Boundless World History
https://www.coursehero.com/study-guides/boundless-worldhistory/british-india/
Source information also reviewed from: Metcalf and Metcalf Concise History of Modern India
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oercommons
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2025-03-18T00:36:47.169654
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Neil Greenwood
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"license": "Creative Commons - Attribution - https://creativecommons.org/licenses/by/4.0/",
"url": "https://oercommons.org/courseware/lesson/87940/overview",
"title": "Statewide Dual Credit World History, European Imperialism and Crises 1871-1919 CE, Chapter 10: Enlightenment and Colonization, Colonization of India",
"author": "Anna McCollum"
}
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https://oercommons.org/courseware/lesson/87972/overview
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The Global Question: “Return to Normalcy?”
Overview
Challenges after the First World War
At the end of the First World War people around the world faced a number of challenges. The Allied Powers had to implement the treaties that ended the war, rebuild the portions of Europe devastated by the war, and establish economic and political stability in the aftermath of this conflict. To complicate matters the United Kingdom and France had been economically exhausted by the war; many in the U.S. were unwilling to participate in the construction of a new world order; Lenin was in the violent process of crafting a centralized and authoritarian government for the new Soviet Union, ; and numerous ethnic and/or national groups across Eurasia yearned for national sovereignty in new national states. On top of these challenges, many Western intellectuals were beginning the process of alienating themselves from Western civilization, believing that it was beyond salvation. The responses to these challenges were only partially successful at best. And the numerous failures in addressing these challenges paved the way for the Second World War.
Learning Objectives
- Explain how the social, political, and military costs of World War I fostered geographic and demographic shifts in Europe, Africa, and the Middle East.
- Explain the global challenge to liberalismby totalitarianism through the movements of communism, fascism, and National Socialism.
- Explain the factors that led to the global depression in the 1930s.
- Compare and contrast the reactions of nations worldwide to this global depression.
Key Terms / Key Concepts
Paris Peace Conference - 1919-20 meeting of delegates from the Allied nations that crafted the treaties which ended World War I
In the 1920 U.S. presidential election campaign Warren Harding ran on the slogan of a “return to normalcy,” by which he meant a return to the way life in the U.S. had been before the First World War. His winning sixty percent of the popular vote in that presidential election reflected the reservations that many Americans had about WWI and U.S. participation in it. Globally, it was one of a number of manifestations of the trouble people were having coming to terms with World War I.
Those who thought about WWI wondered what this war said about humanity and its development. The belligerents had mobilized their societies in what was at that time a total war for combatants and civilians alike, which had achieved at best mixed results. A number of writers, historians, and philosophers, wondered pessimistically about the future of humanity. Otto Spengler wrote about this theme in his two-volume The Decline of the West, published in 1918 and 1922. All Quiet on the Western Front (1928) narrated the pointless aspects of the fighting on the Western Front during the First World War. Other writers, such as Ernest Hemmingway commented about the tragedy of this conflict: A Farewell to Arms (1929). The disaffection of these members of the intelligencia reflected a larger response from people in the participating nations. This popular response to WWI would influence the foreign and military policies of nations around the world.
The people in the victorious and defeated nations had questions about this conflict. In the Allied nations people wondered what had been won. Many Americans supported policies during the twenties and thirties that would keep the U.S. out of another world war at any cost. Similarly British and French leaders followed an approach of appeasement in dealing with Hitler’s annexation of Austria, conquest of the Sudetenland in Czechoslovakia, and invasion of Czechoslovakia in 1938 – 9, in order to avoid another European conflict marked by trench warfare. People in the Central Powers were left with resentment and anger, most visibly in Germany. These feelings grew out of peace treaties drafted at the 1919 – 20 Paris Peace Conference that were in some ways too harsh and in other ways too lenient.
Germany and the Treaty of Versailles
Later it would be realized that the harsh aspects of the Treaty of Versailles imposed on Germany constituted some of the seeds of the Second World War. And U.S. President Woodrow Wilson’s promise that WWI might be “the war to end war”—a phrase originated by H. G. Wells—backfired.
Learning Objectives
- Explain how the social, political, and military costs of World War I fostered geographic and demographic shifts in Europe, Africa, and the Middle East.
- Explain the global challenge to liberalismby totalitarianism through the movements of communism, fascism, and National Socialism.
- Explain the factors that led to the global depression in the 1930s.
- Compare and contrast the reactions of nations worldwide to this global depression.
Key Terms / Key Concepts
Treaty of Versailles: the most important of the peace treaties that ended World War I, which was signed on June 28, 1919, exactly five years after the assassination of Archduke Franz Ferdinand
Stab-in-the-back myth: the notion, widely believed in right-wing circles in Germany after 1918, that the German Army did not lose World War I on the battlefield but was instead betrayed by the civilians on the home front, especially the republicans who overthrew the monarchy in the German Revolution of 1918 – 19 (Advocates denounced the German government leaders who signed the Armistice on November 11, 1918, as the “November Criminals.” When the Nazis came to power in 1933, they made the legend an integral part of their official history of the 1920s, portraying the Weimar Republic as the work of the “November Criminals” who seized power while betraying the nation.)
Reparations
The victorious Allies of WWI imposed harsh reparations on Germany, which were both economically and psychologically damaging. Historians have long argued over the extent to which the reparations led to Germany’s severe economic depression in the interwar period.
World War I reparations were imposed upon the Central Powers during the Paris Peace Conference following their defeat in the First World War by the Allied and Associate Powers. Each defeated power was required to make payments in either cash or kind (a term associated with service). Because of the financial situation Austria, Hungary, and Turkey found themselves in after the war, few to no reparations were paid and the requirements were cancelled. Bulgaria paid only a fraction of what was required before its reparations were reduced and then cancelled. However, Germany was not relieved of their debt as quickly. Historian Ruth Henig argues that the German requirement to pay reparations was the “chief battleground of the post-war era” and “the focus of the power struggle between France and Germany over whether the Versailles Treaty was to be enforced or revised.”
The Treaty of Versailles and the 1921 London Schedule of Payments required Germany to pay 132 billion gold marks ($33 billion USD) in reparations to cover civilian damage caused during the war. Because of the lack of reparation payments by Germany, France occupied the Ruhr in 1923 to enforce payments, causing an international crisis that resulted in the implementation of the Dawes Plan in 1924. This plan outlined a new payment method and raised international loans to help Germany to meet her reparation commitments. Despite this, by 1928 Germany called for a new payment plan, resulting in the Young Plan that established the German reparation requirements at 112 billion marks ($26.3 billion USD) and created a schedule of payments that would see Germany complete payments by 1988. With the collapse of the German economy in 1931, reparations were suspended for a year and in 1932 during the Lausanne Conference they were cancelled altogether. Between 1919 and 1932, Germany paid fewer than 21 billion marks in reparations.
The German people saw reparations as a national humiliation, and the German Government worked to undermine the validity of the Treaty of Versailles and the requirement to pay. British economist John Maynard Keynes called the treaty a Carthaginian peace that would economically destroy Germany. His arguments had a profound effect on historians, politicians, and the public. Despite Keynes’s arguments and those by later historians supporting or reinforcing Keynes’s views, the consensus of contemporary historians is that reparations were not as intolerable as the Germans or Keynes had suggested and were within Germany’s capacity to pay had there been the political will to do so.
The Weimar Republic
In its 14 years in existence, the Weimar Republic faced numerous problems, including hyperinflation, political extremism, and contentious relationships with the victors of the First World War, leading to its collapse during the rise of Adolf Hitler.
Weimar Republic is an unofficial historical designation for the German state between 1919 and 1933. The name derives from the city of Weimar, where its constitutional assembly first took place. The official name of the state was still Deutsches Reich; it had remained unchanged since 1871. A national assembly was convened in Weimar, where a new constitution for the Deutsches Reich was written and adopted on August 11, 1919. In English the country was usually known simply as Germany.
In its 14 years, the Weimar Republic faced numerous problems, including hyperinflation, political extremism (with paramilitaries, both left- and right-wing), and contentious relationships with the victors of the First World War. The people of Germany blamed the Weimar Republic administration, rather than their wartime leaders, for the country’s defeat in WWI and for the humiliating terms of the Treaty of Versailles. However, the Weimar Republic government successfully reformed the currency, unified tax policies, and organized the railway system.
Weimar Germany eliminated most of the requirements of the Treaty of Versailles, but it never completely met its disarmament requirements and eventually paid only a small portion of the war reparations (by twice restructuring its debt through the Dawes Plan and the Young Plan). Under the Locarno Treaties, Germany accepted the western borders of the republic, but continued to dispute the Eastern border.
Challenges and Reasons for Failure
The reasons for the Weimar Republic’s collapse are the subject of continuing debate. It may have been doomed from the beginning since even moderates disliked it and extremists on both the left and right loathed it, a situation referred to by some historians, such as Igor Primoratz, as a “democracy without democrats.” Germany had limited democratic traditions, and Weimar democracy was widely seen as chaotic.
Weimar politicians had been blamed for Germany’s defeat in World War I through a widely believed theory called the “Stab-in-the-back myth,” which contended that Germany’s surrender in World War I had been the unnecessary act of traitors, and thus the popular legitimacy of the government was on shaky ground. As normal parliamentary lawmaking broke down and was replaced around 1930 by a series of emergency decrees, the decreasing popular legitimacy of the government further drove voters to extremist parties.
The Republic in its early years was already under attack from both left- and right-wing sources. The radical left accused the ruling Social Democrats of betraying the ideals of the workers’ movement by preventing a communist revolution, and they sought to overthrow the Republic and do so themselves. Various right-wing sources opposed any democratic system, preferring an authoritarian, autocratic state like the 1871 Empire. To further undermine the Republic’s credibility, some right-wingers (especially certain members of the former officer corps) also blamed an alleged conspiracy of Socialists and Jews for Germany’s defeat in World War I.
The Weimar Republic had some of the most serious economic problems ever experienced by any Western democracy in history. Rampant hyperinflation, massive unemployment, and a large drop in living standards were primary factors. In the first half of 1922, the mark stabilized at about 320 marks per dollar. By fall 1922, Germany found itself unable to make reparations payments since the price of gold was now well beyond what it could afford. Also, the mark was by now practically worthless, making it impossible for Germany to buy foreign exchange or gold using paper marks. Instead, reparations were to be paid in goods such as coal. In January 1923, French and Belgian troops occupied the Ruhr, the industrial region of Germany in the Ruhr Valley, to ensure reparations payments. Inflation was exacerbated when workers in the Ruhr went on a general strike and the German government printed more money to continue paying for their passive resistance. By November 1923, the US dollar was worth 4,.2 trillion German marks. In 1919, one loaf of bread cost 1 mark; by 1923, the same loaf of bread cost 100 billion marks.
From 1923 to 1929, there was a short period of economic recovery, but the Great Depression of the 1930s led to a worldwide recession. Germany was particularly affected because it depended heavily on American loans. In 1926, about 2 million Germans were unemployed, which rose to around 6 million in 1932. Many blamed the Weimar Republic. That was made apparent when political parties on both right and left, wanting to disband the Republic altogether, made any democratic majority in Parliament impossible.
The reparations damaged Germany’s economy by discouraging market loans, which forced the Weimar government to finance its deficit by printing more currency, causing rampant hyperinflation. In addition, the rapid disintegration of Germany in 1919 by the return of a disillusioned army, the rapid change from possible victory in 1918 to defeat in 1919, which fueled the Stab-in-the-back myth, and the political chaos may have caused a psychological imprint on Germans that could lead to extreme nationalism, later epitomized and exploited by Hitler. It is also widely believed that the 1919 constitution had several weaknesses, making the eventual establishment of a dictatorship likely, but it is unknown whether a different constitution could have prevented the rise of the Nazi party.
Geopolitical Consequences of the First World War
The period from 1919 through 1924 was marked by turmoil as Europe struggled to recover from the devastation of the First World War and the destabilizing effects of the loss of four large historic empires: the German Empire, Austro-Hungarian Empire, Russian Empire, and the Ottoman Empire. The dissolution of these empires created a number of new countries in eastern Europe and the Middle East, most of them small, each with a number of ethnic minorities. The creation of these new nations sparked a number of conflicts.
Learning Objectives
- Explain how the social, political, and military costs of World War I fostered geographic and demographic shifts in Europe, Africa, and the Middle East.
- Explain the global challenge to liberalismby totalitarianism through the movements of communism, fascism, and National Socialism.
- Explain the factors that led to the global depression in the 1930s.
- Compare and contrast the reactions of nations worldwide to this global depression.
Key Terms / Key Concepts
League of Nations: an intergovernmental organization founded on January 10, 1920, as a result of the Paris Peace Conference that ended the First World War; the first international organization whose principal mission was to maintain world peace. Its primary goals as stated in its Covenant included preventing wars through collective security and disarmament and settling international disputes through negotiation and arbitration.
self-determination: principle that a people have the right to determine their sovereignty and international political status
Kellogg-Briand Pact: a 1928 international agreement in which signatory states promised not to use war to resolve “disputes or conflicts of whatever nature or of whatever origin they may be, which may arise among them”
Spanish Civil War: a war from 1936 to 1939 between the Republicans (loyalists to the democratic, left leaning and relatively urban Second Spanish Republic along with Anarchists and Communists) and forces loyal to General Francisco Franco (Nationalists, Falangists, and Carlists - a largely aristocratic conservative group)
Internally these new countries tended to have substantial ethnic minorities who wished to unite with neighboring states where their ethnicity dominated. For example, Czechoslovakia had residents who associated with the following nationalities: German, Polish, Ruthenian and Ukrainian, Slovak, and Hungarian. Millions of Germans found themselves minorities in the newly created countries. More than two million ethnic Hungarians found themselves living outside of Hungary in Slovakia, Romania, and Yugoslavia. Many of these national minorities found themselves in bad situations because modern governments were intent on defining the national character of the countries, often at the expense of the minorities. The League of Nations sponsored various Minority Treaties in an attempt to deal with the problem, but with the decline of the League in the 1930s, these treaties became increasingly unenforceable.
One consequence of the massive redrawing of borders and the political changes in the aftermath of World War I was the large number of European refugees. These and the refugees of the Russian Civil War led to the creation of the Nansen passport. In a related set of developments, the presence of ethnic minorities made the location of the frontiers difficult to determine. New states defined by the presence of specific ethnic groups struggled to find ways to include members of other ethnic groups. For example, Czechoslovakia failed to find a place for Sudeten Germans who lived on the northern, western, and southern edges of the new nation, which Adolf Hitler exploited in 1938 with his annexation of the Sudetenland.
Economic and military cooperation among these small states was minimal, ensuring that the defeated powers of Germany and the Soviet Union retained a latent capacity to dominate the region. In the immediate aftermath of the war, defeat drove cooperation between Germany and the Soviet Union, but ultimately these two powers would compete to dominate eastern Europe.
At the end of the war, the Allies occupied Constantinople (Istanbul) and the Ottoman government collapsed. The Treaty of Sèvres, a plan designed by the Allies to dismember the remaining Ottoman territories, was signed on August 10, 1920, although it was never ratified by the Sultan. The occupation of Smyrna by Greece on May 18, 1919, triggered a nationalist movement to rescind the terms of the treaty. Turkish revolutionaries led by Mustafa Kemal Atatürk, a successful Ottoman commander, rejected the terms enforced at Sèvres and under the guise of General Inspector of the Ottoman Army, left Istanbul for Samsun to organize the remaining Ottoman forces to resist the terms of the treaty. After Turkish resistance gained control over Anatolia and Istanbul, the Sèvres treaty was superseded by the Treaty of Lausanne, which formally ended all hostilities and led to the creation of the modern Turkish Republic. As a result, Turkey became the only power of World War I to overturn the terms of its defeat and negotiate with the Allies as an equal.
Self-Determination
The right of peoples to self-determination is a cardinal principle in modern international law. It states that peoples, based on respect for the principle of equal rights and fair equality of opportunity, have the right to freely choose their sovereignty and international political status with no interference. The explicit terms of this principle can be traced to the Atlantic Charter, signed on August 14, 1941, by Franklin D. Roosevelt, President of the United States of America, and Winston Churchill, Prime Minister of the United Kingdom. It also is derived from principles espoused by United States President Woodrow Wilson following World War I, after which some new nation states were formed or previous states revived after the dissolution of empires. The principle does not state how the decision is to be made nor what the outcome should be—whether it be independence, federation, protection, some form of autonomy, or full assimilation. Neither does it state what the delimitation between peoples should be, nor what constitutes a people. There are conflicting definitions and legal criteria for determining which groups may legitimately claim the right to self-determination.
The employment of imperialism through the expansion of empires and the concept of political sovereignty, as developed after the Treaty of Westphalia, also explains the emergence of self-determination during the modern era. During and after the Industrial Revolution, many groups of people recognized their shared history, geography, language, and customs. Nationalism emerged as a uniting ideology not only between competing powers, but also for groups that felt subordinated or disenfranchised inside larger states. Such groups often pursued independence and sovereignty over territory, but sometimes a different sense of autonomy has been pursued or achieved. In this situation, self-determination can be seen as a reaction to imperialism.
The revolt of New World British colonists in North America during the mid-1770s has been seen as the first assertion of the right of national and democratic self-determination because of the explicit invocation of natural law, the natural rights of man, and the consent of and sovereignty by, the people governed; these ideas were inspired particularly by John Locke’s enlightened writings of the previous century. Thomas Jefferson further promoted the notion that the will of the people was supreme, especially through authorship of the United States Declaration of Independence, which inspired Europeans throughout the 19th century.
Leading up to World War I, in Europe there was a rise of nationalism, with nations such as Greece, Hungary, Poland, and Bulgaria seeking or winning their independence. Woodrow Wilson revived America’s commitment to self-determination, at least for European states, during World War I. When the Bolsheviks came to power in Russia in November 1917, they called for Russia’s immediate withdrawal as a member of the Allies of World War I. They also supported the right of all nations, including colonies, to self-determination. The 1918 Constitution of the Soviet Union acknowledged the right of secession for its constituent republics. This presented a challenge to Wilson’s more limited demands. In January 1918 Wilson issued his Fourteen Points that, among other things, called for adjustment of colonial claims insofar as the interests of colonial powers had equal weight with the claims of subject peoples. The Treaty of Brest-Litovsk in March 1918 led to Russia’s exit from the war and the independence of Armenia, Finland, Estonia, Latvia, Ukraine, Lithuania, Georgia, and Poland.
Similarly, the Allies replaced the dissolved Austro-Hungarian, German, and Ottoman Empires with new smaller and more homogenous Austrian, Hungarian, German, and Ottoman states, along with a number of new states and the cession of portions of the old empires to extant nations. The Allies carved Czechoslovakia and the Kingdom of Slovenes, Croats and Serbs out of the old Austro-Hungarian Empire. The German Empire lost Northern Slesvig to Denmark after a referendum. The defeated Ottoman empire was dissolved into the Republic of Turkey and several smaller nations, including Yemen, plus the new Middle East Allied “mandates” of Syria and Lebanon (future Syria, Lebanon and Hatay State), Palestine (future Transjordan and Israel), and Mesopotamia (future Iraq). The League of Nations was proposed as much as a means of consolidating these new states, as a path to peace.
During the 1920s and 1930s there were some successful movements for self-determination in the beginnings of the process of decolonization. In the Statute of Westminster, the United Kingdom granted independence to Canada, New Zealand, Newfoundland, the Irish Free State, the Commonwealth of Australia, and the Union of South Africa after the British parliament declared itself as incapable of passing laws over them without their consent. Egypt, Afghanistan, and Iraq also achieved independence from Britain and Lebanon from France. Other efforts were unsuccessful, like the Indian independence movement. However, Italy, Japan, and Germany all initiated new efforts to bring certain territories under their control, leading to World War II.
The Kellogg-Briand Pact
The Kellogg-Briand Pact (or Pact of Paris, officially General Treaty for Renunciation of War as an Instrument of National Policy) intended to establish “the renunciation of war as an instrument of national policy,” but it was largely ineffective in preventing conflict or war. This treaty was a 1928 international agreement in which signatory states promised not to use war to resolve “disputes or conflicts of whatever nature or of whatever origin they may be, which may arise among them.” Parties failing to abide by this promise “should be denied the benefits furnished by this treaty.” It was signed by Germany, France, and the United States on August 27, 1928, and by most other nations soon after. Sponsored by France and the U.S., the Pact renounces the use of war and calls for the peaceful settlement of disputes. Similar provisions were incorporated into the Charter of the United Nations and other treaties, and they became a stepping-stone to a more activist American policy. It is named after its authors, United States Secretary of State Frank B. Kellogg and French foreign minister Aristide Briand.
The text of the treaty reads:
Persuaded that the time has come when a frank renunciation of war as an instrument of national policy should be made to the end that the peaceful and friendly relations now existing between their peoples may be perpetuated; Convinced that all changes in their relations with one another should be sought only by pacific means and be the result of a peaceful and orderly process, and that any signatory Power which shall hereafter seek to promote its national interests by resort to war should be denied the benefits furnished by this Treaty;
Hopeful that, encouraged by their example, all the other nations of the world will join in this humane endeavour and by adhering to the present Treaty as soon as it comes into force bring their peoples within the scope of its beneficent provisions, thus uniting the civilized nations of the world in a common renunciation of war as an instrument of their national policy; Have decided to conclude a Treaty…
After negotiations, the pact was signed in Paris at the French Foreign Ministry by the representatives from Australia, Belgium, Canada, Czechoslovakia, France, Germany, British India, the Irish Free State, Italy, Japan, New Zealand, Poland, South Africa, the United Kingdom, and the United States. The provision was that it would come into effect on July 24, 1929. By that date, additional nations embraced the pact, including Afghanistan, Albania, Austria, Bulgaria, China, Cuba, Denmark, Dominican Republic, Egypt, Estonia, Ethiopia, Finland, Guatemala, Hungary, Iceland, Latvia, Liberia, Lithuania, the Netherlands, Nicaragua, Norway, Panama, Peru, Portugal, Romania, the Soviet Union, the Kingdom of the Serbs, Croats, and Slovenes, Siam, Spain, Sweden, and Turkey. Eight further states joined after that date (Persia, Greece, Honduras, Chile, Luxembourg, Danzig, Costa Rica and Venezuela), for a total of 62 signatories.
In the United States, the Senate approved the treaty overwhelmingly, 85–1, with only Wisconsin Republican John J. Blaine voting against. While the U.S. Senate did not add any reservation to the treaty, it did pass a measure that interpreted the treaty as not infringing upon the United States’s right of self-defense and as not obliging the nation to enforce it by taking action against those who violated it.
Effect and Legacy
As a practical matter, the Kellogg–Briand Pact did not live up to its aim of ending war or stopping the rise of militarism, and in this sense, it made no immediate contribution to international peace and proved to be ineffective in the years to come. Moreover, the pact erased the legal distinction between war and peace because the signatories, having renounced the use of war, began to wage wars without declaring them as in the Japanese invasion of Manchuria in 1931, the Italian invasion of Abyssinia in 1935, the Spanish Civil War in 1936, the Soviet invasion of Finland in 1939, and the German and Soviet Union invasions of Poland. Nevertheless, the pact is an important multilateral treaty because, in addition to binding the particular nations that signed it, it has also served as one of the legal bases establishing the international norms that the threat or use of military force in contravention of international law, as well as the territorial acquisitions resulting from it, are unlawful.
Notably, the pact served as the legal basis for the creation of the notion of crime against peace. It was for committing this crime that the Nuremberg Tribunal and Tokyo Tribunal tried and sentenced a number of people responsible for starting World War II.
The interdiction of aggressive war was confirmed and broadened by the United Nations Charter, which provides in article 2, paragraph 4, that “All Members shall refrain in their international relations from the threat or use of force against the territorial integrity or political independence of any state, or in any other manner inconsistent with the Purposes of the United Nations.” One legal consequence of this is that it is clearly unlawful to annex territory by force. However, neither this nor the original treaty has prevented the subsequent use of annexation. More broadly, there is a strong presumption against the legality of using or threatening military force against another country. Nations that have resorted to the use of force since the Charter came into effect have typically invoked self-defense or the right of collective defense.
These challenges in the aftermath of the First World War threatened international order and domestic stability in a number of nations. Failure to respond successfully to them set humanity on a path to a Second World War.
Attributions
A refugee family returning to Amiens, France, looking at the ruins of a house on Sept. 17, 1918. Credit: Courtesy IWM. Source - https://www.cnn.com/style/article/photographs-life-after-world-war-i-imperial-war-museum/index.html
Images courtesy of Wikimedia Commons
Title Image - photo of a family's return to Amiens, France 17 September 1918. Attribution: Credit: Courtesy International War Museum. Provided by: CNN. Location: https://www.cnn.com/style/article/photographs-life-after-world-war-i-imperial-war-museum/index.html. License: CC BY-SA: Attribution-ShareAlike
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"Rebuilding Europe"
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Hyperinflation in the Weimar Republic. Provided by: Wikipedia. Located at: https://en.wikipedia.org/wiki/Hyperinflation_in_the_Weimar_Republic. License: CC BY-SA: Attribution-ShareAlike
Weimar Republic. Provided by: Wikipedia. Located at: https://en.wikipedia.org/wiki/Weimar_Republic. License: CC BY-SA: Attribution-ShareAlike
A_view_of_the_ruins_of_Avocourt,_situated_just_behind_the_American_trenches_before_the_Allied_drive_of_September_26..._-_NARA_-_530763.tif.jpg. Provided by: Wikipedia. Located at: https://en.wikipedia.org/wiki/World_War_I_reparations#/media/File:A_view_of_the_ruins_of_Avocourt,_situated_just_behind_the_American_trenches_before_the_Allied_drive_of_September_26..._-_NARA_-_530763.tif. License: CC BY-SA: Attribution-ShareAlike
Bundesarchiv_Bild_102-00193,_Inflation,_Ein-Millionen-Markschein.jpg. Provided by: Wikipedia. Located at: https://en.wikipedia.org/wiki/Weimar_Republic#/media/File:Bundesarchiv_Bild_102-00193,_Inflation,_Ein-Millionen-Markschein.jpg. License: CC BY-SA: Attribution-ShareAlike
Self-determination. Provided by: Wikipedia. Located at: https://en.wikipedia.org/wiki/Self-determination. License: CC BY-SA: Attribution-ShareAlike
Interwar period. Provided by: Wikipedia. Located at: https://en.wikipedia.org/wiki/Interwar_period. License: CC BY-SA: Attribution-ShareAlike
Aftermath of World War I. Provided by: Wikipedia. Located at: https://en.wikipedia.org/wiki/Aftermath_of_World_War_I. License: CC BY-SA: Attribution-ShareAlike
A_view_of_the_ruins_of_Avocourt,_situated_just_behind_the_American_trenches_before_the_Allied_drive_of_September_26..._-_NARA_-_530763.tif.jpg. Provided by: Wikipedia. Located at: https://en.wikipedia.org/wiki/World_War_I_reparations#/media/File:A_view_of_the_ruins_of_Avocourt,_situated_just_behind_the_American_trenches_before_the_Allied_drive_of_September_26..._-_NARA_-_530763.tif. License: CC BY-SA: Attribution-ShareAlike
Europe_in_1923.jpg. Provided by: Wikipedia. Located at: https://en.wikipedia.org/wiki/Interwar_period#/media/File:Europe_in_1923.jpg. License: CC BY-SA: Attribution-ShareAlike
Kellogg-Briand Pact. Provided by: Wikipedia. Located at: https://en.wikipedia.org/wiki/Kellogg-Briand_Pact. License: CC BY-SA: Attribution-ShareAlike
League of Nations: Treaty Series, 1929. Provided by: United Nations Treaty Collection. Located at: https://treaties.un.org/doc/Publication/UNTS/LON/Volume%2094/v94.pdf. License: Public Domain: No Known Copyright
A_view_of_the_ruins_of_Avocourt,_situated_just_behind_the_American_trenches_before_the_Allied_drive_of_September_26..._-_NARA_-_530763.tif.jpg. Provided by: Wikipedia. Located at: https://en.wikipedia.org/wiki/World_War_I_reparations#/media/File:A_view_of_the_ruins_of_Avocourt,_situated_just_behind_the_American_trenches_before_the_Allied_drive_of_September_26..._-_NARA_-_530763.tif. License: CC BY-SA: Attribution-ShareAlike
Bundesarchiv_Bild_102-00193,_Inflation,_Ein-Millionen-Markschein.jpg. Provided by: Wikipedia. Located at: https://en.wikipedia.org/wiki/Weimar_Republic#/media/File:Bundesarchiv_Bild_102-00193,_Inflation,_Ein-Millionen-Markschein.jpg. License: CC BY-SA: Attribution-ShareAlike
BriandKellogg1928c.jpg. Provided by: Wikipedia. Located at: https://en.wikipedia.org/wiki/Kellogg-Briand_Pact#/media/File:BriandKellogg1928c.jpg. License: CC BY-SA: Attribution-ShareAlike
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oercommons
|
2025-03-18T00:36:47.213625
|
Neil Greenwood
|
{
"license": "Creative Commons - Attribution - https://creativecommons.org/licenses/by/4.0/",
"url": "https://oercommons.org/courseware/lesson/87972/overview",
"title": "Statewide Dual Credit World History, The Catastrophe of the Modern Era: 1919-Present CE, Chapter 13: Post WWI, The Global Question: “Return to Normalcy?”",
"author": "Anna McCollum"
}
|
https://oercommons.org/courseware/lesson/88075/overview
|
Soviet Union During the Cold War
Overview
Soviet Union During the Cold War
While there is much discussion on the role of the United States in the Cold War, this period was very important for the Soviet Union. Following Stalin's death, the Soviet Union had a dramatic economic growth and politcial power shift in Europe.
Learning Objectives
- Evaluate the differences between Soviet Communism and United States Capitalism.
- Analyze the impact of the end of World War II on the post-war societies.
- Evaluate the role of United States foreign policy in shaping the post World War II world.
Key Terms / Key Concepts
Berlin airlift: in response to the Berlin Blockade, the Western Allies organized this project to carry supplies to the people of West Berlin by air.
Greek Civil War: a war fought in Greece from 1946 to 1949 between the Greek government army backed by the United Kingdom and the United States—and the Democratic Army of Greece (DSE, the military branch of the Greek Communist Party (KKE)—backed by Yugoslavia, Albania, and Bulgaria
Molotov Plan: the system created by the Soviet Union in 1947 to provide aid to rebuild the countries in Eastern Europe that were politically and economically aligned to the Soviet Union
Potsdam Agreement: the 1945 agreement between three of the Allies of World War II, United Kingdom, United States, and USSR, for the military occupation and reconstruction of Germany (It included Germany’s demilitarization, reparations, and the prosecution of war criminals.)
reparations: payments intended to cover damage or injury inflicted during a war
The Berlin Blockade
From July 17 to August 2, 1945, the victorious Allied Powers reached the Potsdam Agreement on the fate of postwar Europe, calling for the division of defeated Germany into four temporary occupation zones (thus reaffirming principles laid out earlier by the Yalta Conference). These zones were located roughly around the then-current locations of the Allied armies. Also divided into occupation zones, Berlin was located 100 miles inside Soviet-controlled eastern Germany. The United States, United Kingdom, and France controlled western portions of the city, while Soviet troops controlled the eastern sector.
In a June 1945 meeting, Stalin informed German communist leaders that he expected to slowly undermine the British position within their occupation zone, that the United States would withdraw within a year or two, and that nothing would then stand in the way of a united Germany under communist control within the Soviet orbit. Stalin and other leaders told visiting Bulgarian and Yugoslavian delegations in early 1946 that Germany must be both Soviet and communist.
Creation of an economically stable western Germany required reform of the unstable Reichsmark German currency introduced after the 1920s German inflation. The Soviets had debased the Reichsmark by excessive printing, resulting in Germans using cigarettes as a de facto currency or for bartering. The Soviets opposed western plans for a reform. They interpreted this new currency as an unjustified, unilateral decision. On June 18, the United States, Britain, and France announced that on June 21 the Deutsche Mark would be introduced, but the Soviets refused to permit its use as legal tender in Berlin. The Allies had already transported 2.5 million Deutsche Marks into the city and it quickly became the standard currency in all four sectors. Against the wishes of the Soviets, the new currency, along with the Marshall Plan that backed it, appeared to have the potential to revitalize Germany.
The Berlin Blockade (June 24, 1948 – May 12, 1949) was one of the first major international crises of the Cold War. In June 1948, Stalin instituted the Berlin Blockade, which blocked the Western Allies’ This blockade prevented food, materials, and supplies from arriving in West Berlin. railway, road, and canal access to the sectors of Berlin under Western control. Stalin looked to force the Western nations to abandon Berlin. However, the Soviets offered to drop the blockade if the Western Allies withdrew the newly introduced Deutsche mark from West Berlin.
The day after the June 18, 1948 announcement of the new Deutsche Mark, Soviet guards halted all passenger trains and traffic on the autobahn to Berlin, delayed Western and German freight shipments, and required that all water transport secure special Soviet permission. On June 21, the day the Deutsche Mark was introduced, the Soviet military halted a United States military supply train to Berlin and sent it back to western Germany. On June 22, the Soviets announced that they would introduce a new currency in their zone. On June 24, the Soviets severed land and water connections between the non-Soviet zones and Berlin. That same day, they halted all rail and barge traffic in and out of Berlin. On June 25, the Soviets stopped supplying food to the civilian population in the non-Soviet sectors of Berlin. Motor traffic from Berlin to the western zones was permitted, but this required a 14.3-mile detour to a ferry crossing because of alleged “repairs” to a bridge. They also cut off Berlin’s electricity using their control over the generating plants in the Soviet zone. At the time, West Berlin had 36 days’ worth of food, and 45 days’ worth of coal.
Militarily, the Americans and British were greatly outnumbered because of the postwar reduction in their armies. The United States, like other western countries, had disbanded most of its troops and was largely inferior in the European theater. The entire United States Army was reduced to 552,000 men by February 1948. Military forces in the western sectors of Berlin numbered only 8,973 Americans, 7,606 British, and 6,100 French. Soviet military forces in the Soviet sector that surrounded Berlin totaled 1.5 million. The two United States regiments in Berlin could have provided little resistance against a Soviet attack. Believing that Britain, France, and the United States had little option than to acquiesce, the Soviet Military Administration in Germany celebrated the beginning of the blockade.
In response to the blockade, the Western Allies organized the Berlin airlift to carry supplies to the people of West Berlin, a difficult feat given the city’s population. Aircrews from the United States Air Force, the British Royal Air Force, the Royal Canadian Air Force, the Royal Australian Air Force, the Royal New Zealand Air Force, and the South African Air Force flew over 200,000 flights in one year, providing the West Berliners up to 8,893 tons of necessities each day, such as fuel and food.
On November 30, 1945, it was agreed in writing that there would be three 20-mile-wide air corridors providing free access to Berlin. Additionally, unlike a force of tanks and trucks, the Soviets could not claim that cargo aircraft were some sort of military threat. In the face of unarmed aircraft refusing to turn around, the only way to enforce the blockade would have been to shoot them down. An airlift would force the Soviet Union to either shoot down unarmed humanitarian aircraft, thus breaking their own agreements, or back down. The Soviets did not disrupt the airlift for fear this might lead to open conflict.
The American military government, based on a minimum daily ration of 1,990 calories, set a total of daily supplies at 646 tons of flour and wheat, 125 tons of cereal, 64 tons of fat, 109 tons of meat and fish, 180 tons of dehydrated potatoes, 180 tons of sugar, 11 tons of coffee, 19 tons of powdered milk, 5 tons of whole milk for children, 3 tons of fresh yeast for baking, 144 tons of dehydrated vegetables, 38 tons of salt, and 10 tons of cheese. In all, 1,534 tons were required each day to sustain the more than two million people of Berlin. Additionally, for heat and power, 3,475 tons of coal and gasoline were also required daily. During the first week, the airlift averaged only ninety tons a day, but by the second week it reached 1,000 tons. This likely would have sufficed had the effort lasted only a few weeks as originally believed. But by the end of August, after two months, the Airlift was succeeding; daily operations flew more than 1,500 flights a day and delivered more than 4,500 tons of cargo, enough to keep West Berlin supplied.
The Communist press in East Berlin ridiculed the project. It derisively referred to “the futile attempts of the Americans to save face and to maintain their untenable position in Berlin.” However, as the tempo of the Airlift grew, it became apparent that the Western powers might be able to pull off the impossible: indefinitely supplying an entire city by air alone. In response, starting on August 1, the Soviets offered free food to anyone who crossed into East Berlin and registered their ration cards there, but West Berliners overwhelmingly rejected Soviet offers of food.
End of the Blockade
On April 15, 1949 the Russian news agency TASS reported a willingness by the Soviets to lift the blockade. The next day the U.S. State Department stated the “way appears clear” for the blockade to end. Soon afterwards, the four powers began serious negotiations and a settlement was reached on Western terms. On May 4, 1949, the Allies announced an agreement to end the blockade in eight days’ time.
The Soviet blockade of Berlin was lifted at one minute after midnight on May 12, 1949. A British convoy immediately drove through to Berlin, and the first train from West Germany reached Berlin at 5:32 a.m. Later that day an enormous crowd celebrated the end of the blockade. General Clay, whose retirement had been announced by US President Truman on May 3, was saluted by 11,000 US soldiers and dozens of aircraft. Once home, Clay received a ticker-tape parade in New York City, was invited to address the US Congress, and was honored with a medal from President Truman.
Berlin Airlift Monument in Berlin-Tempelhof displays the names of the 39 British and 31 American airmen who lost their lives during the operation. Similar monuments can be found at the military airfield of Wietzenbruch near the former RAF Celle and at Rhein-Main Air Base.
The Warsaw Pact
The Warsaw Pact formally the Treaty of Friendship, Co-operation, and Mutual Assistance—was a collective defense treaty among the Soviet Union and seven other Soviet satellite states in Central and Eastern Europe during the Cold War. The Warsaw Pact was the military complement to the Council for Mutual Economic Assistance (CoMEcon)—the regional economic organization for the communist states of Central and Eastern Europe. The Warsaw Pact was created in reaction to the integration of West Germany into NATO in 1955, but it is also considered to have been motivated by Soviet desires to maintain control over military forces in Central and Eastern Europe.
The Soviets wanted to keep their part of Europe and not let the Americans take it from them. Ideologically, the Soviet Union demanded the right to define socialism and communism and act as the leader of the global socialist movement. A corollary to this idea was the necessity of intervention if a country appeared to be violating core socialist ideas and Communist Party functions, which was explicitly stated in the Brezhnev Doctrine. Geostrategic principles also drove the Soviet Union to prevent invasion of its territory by Western European powers.
The eight member countries of the Warsaw Pact pledged the mutual defense of any member who was attacked. Relations among the treaty signatories were based upon mutual non-intervention in the internal affairs of the member countries, respect for national sovereignty, and political independence. However, almost all governments of those member states were indirectly controlled by the Soviet Union.
While the Warsaw Pact was established as a balance of power or counterweight to NATO, there was no direct confrontation between them. Instead, the conflict was fought on an ideological basis. Both NATO and the Warsaw Pact led to the expansion of military forces and their integration into the respective blocs. Its largest military engagement was the Warsaw Pact invasion of Czechoslovakia (with the participation of all Pact nations except Romania).
Soviet Nuclear Strategy
In 1960 and 1961, Khrushchev tried to impose the concept of nuclear deterrence on the military. Nuclear deterrence holds that the reason for having nuclear weapons is to discourage their use by a potential enemy. With each side deterred from war because of the threat of its escalation into a nuclear conflict, Khrushchev believed, “peaceful coexistence” with capitalism would become permanent and allow the inherent superiority of socialism to emerge in economic and cultural competition with the West.
Khrushchev hoped that exclusive reliance on the nuclear firepower of the newly created Strategic Rocket Forces would remove the need for increased defense expenditures. He also sought to use nuclear deterrence to justify his massive troop cuts—his downgrading of the Ground Forces, traditionally the “fighting arm” of the Soviet armed forces. Krushchev also wanted to justify his plans to replace bombers with missiles and the surface fleet with nuclear missile submarines. However, during the Cuban missile crisis the USSR had only four R-7 Semyorkas and a few R-16s intercontinental missiles deployed in vulnerable surface launchers. In 1962 the Soviet submarine fleet had only eight submarines with short-range missiles that could be launched only from submarines that surfaced and lost their hidden submerged status.
Khrushchev’s attempt to introduce a nuclear “doctrine of deterrence” into Soviet military thought failed. Discussion of nuclear war in the first authoritative Soviet monograph on strategy since the 1920s—Marshal Vasilii Sokolovskii’s “Military Strategy”—focused on the use of nuclear weapons for fighting rather than for deterring a war. Sokolovskii argued that should such a war break out both sides would pursue the most decisive aims with the most forceful means and methods. Intercontinental ballistic missiles and aircraft would deliver massed nuclear strikes on the enemy’s military and civilian objectives, and the war would assume an unprecedented geographical scope. Essentially, Soviet military writers argued that the use of nuclear weapons in the initial period of the war would decide the course and outcome of the war as a whole. Both in doctrine and in strategy, the nuclear weapon reigned supreme.
The Propaganda War
Soviet propaganda was disseminated through tightly controlled media outlets in the Eastern Bloc. Media in the Eastern Bloc was an organ of the state, completely reliant on and subservient to the communist party. Radio and television organizations were typically state-owned, while print media was usually owned by political organizations, mostly by local communist parties. Soviet propaganda used Marxist philosophy to attack capitalism, claiming labor exploitation and war-mongering imperialism were inherent in the system.
Along with the broadcasts of the British Broadcasting Corporation and the Voice of America to Central and Eastern Europe, a major propaganda effort begun in 1949 was Radio Free Europe/Radio Liberty, dedicated to bringing about the peaceful demise of the communist system in the Eastern Bloc. Radio Free Europe attempted to achieve these goals by serving as a surrogate home radio station, an alternative to the controlled and party-dominated domestic press. Radio Free Europe was a product of some of the most prominent architects of America’s early Cold War strategy, especially those who believed that the Cold War would eventually be fought by political rather than military means, such as George F. Kennan.
Propaganda in the Eastern Bloc
Eastern Bloc media and propaganda was controlled directly by each country’s Communist party, which controlled the state media, censorship, and propaganda organs. State and party ownership of print, television, and radio media was used to control information and society in light of Eastern Bloc leaderships viewing even marginal groups of opposition intellectuals as a potential threat to the bases underlying Communist power therein.
The ruling authorities viewed media as a propaganda tool and widely practiced censorship to exercise almost full control over information dissemination. The press in Communist countries was an organ of and completely reliant on the state. Until the late 1980s, all Eastern Bloc radio and television organizations were state-owned and tightly controlled.
In each country, leading bodies of the ruling Communist Party exercised hierarchical control of the censorship system. Each Communist Party maintained a department of its Central Committee apparatus to supervise media. Censors employed auxiliary tools such as: the power to launch or close down any newspaper, radio or television station; licensing of journalists through unions; and the power of appointment. Party bureaucrats held all leading editorial positions.
Circumvention of censorship occurred to some degree through samizdat (underground publications produced and disseminated by hand) and limited reception of western radio and television broadcasts. In addition, some regimes heavily restricted the flow of information from their countries to outside of the Eastern Bloc by regulating the travel of foreigners and segregating approved travelers from the domestic population.
Molotov Plan
The Molotov Plan was the system created by the Soviet Union in 1947 to provide aid to rebuild the countries in Eastern Europe that were politically and economically aligned with the Soviet Union. It can be seen as the USSR’s version of the Marshall Plan,which for political reasons the Eastern European countries would not be able to join without leaving the Soviet sphere of influence. Soviet foreign minister Vyacheslav Molotov rejected the Marshall Plan (1947), proposing the Molotov Plan – the Soviet-sponsored economic grouping which was eventually expanded to become the COMECON. The Molotov plan was symbolic of the Soviet Union’s refusal to accept aid from the Marshall Plan or allow any of their satellite states to do so because of their belief that the Plan was an attempt to weaken Soviet interest in their satellite states through the conditions imposed and by making beneficiary countries economically dependent on the United States.
The plan was a system of bilateral trade agreements that established COMECON to create an economic alliance of socialist countries. This aid allowed countries in Europe to stop relying on American aid, and therefore allowed Molotov plan states to reorganize their trade to the USSR instead. The plan was in some ways contradictory, however, because at the same time the Soviets were giving aid to Eastern bloc countries, they were demanding that countries who were members of the Axis powers pay reparations to the USSR.
Attributions
Source image provided by Wikimedia Commons: Russische bezetters Joegoslavie, Bestanddeelnr 907-1635
https://commons.wikimedia.org/wiki/File:Russische_bezetters_Joegoslavie,_Bestanddeelnr_907-1635.jpg
Chapters adapted from:
https://www.coursehero.com/study-guides/boundless-worldhistory/the-beginning-of-the-cold-war/
https://www.coursehero.com/study-guides/boundless-worldhistory/life-in-the-ussr/
https://www.coursehero.com/study-guides/boundless-worldhistory/containment/
https://www.coursehero.com/study-guides/boundless-worldhistory/competition-between-east-and-west/
https://www.coursehero.com/study-guides/boundless-worldhistory/crisis-points-of-the-cold-war/
|
oercommons
|
2025-03-18T00:36:47.243304
|
Neil Greenwood
|
{
"license": "Creative Commons - Attribution - https://creativecommons.org/licenses/by/4.0/",
"url": "https://oercommons.org/courseware/lesson/88075/overview",
"title": "Statewide Dual Credit World History, The Catastrophe of the Modern Era: 1919-Present CE, Chapter 15: Cold War & Decolonization, Soviet Union During the Cold War",
"author": "Anna McCollum"
}
|
https://oercommons.org/courseware/lesson/87963/overview
|
More than Mimi and Toutou: World War I in Africa
Overview
World War I in Africa
The campaigns fought in Africa during World War I were unlike any other; they were plagued by brutal and shifting weather, bees, parasites, and charging rhinoceroses. The war in Africa saw hundreds of thousands of black African troops fighting for each side of the war, and millions of lives and property disrupted by the conflict. Notably, the campaign in German East Africa was the longest conflict of World War I. It achieved the status also as being the only place in the world where the Germans were never militarily defeated by the Allies. German East Africa also holds the record for the highest number of different ethnicities fighting one another in all of World War I. Given these unique characteristics, it is surprising and ironic that the war in Africa is largely forgotten and ignored.
Learning Objectives
- Evaluate the importance of the World War in Africa.
- Analyze the roles of Africans in the World War.
Key Terms / Key Concepts
Askaris: African non-commissioned officers and enlisted men
“Battle of the Bees”: 1914 German victory at the port city of Tanga
Geoffrey Spicer-Simson: eccentric British commander at the Battle of Lake Tanganyika
German East Africa: present-day Tanzania, the longest campaign of World War I
Jan Smuts: commander of the British army in WWI from 1916 – 1918
King’s African Rifles: British army in the African colonies with British officers and African enlisted men
Mimi and Toutou: British, armed motor boats that were carried overland to Lake Tanganyika
Paul Lettow von Vorbeck: German commander who continually evaded, and defeated the Allies in German East Africa during World War I
Schutztruppe: German army in the African colonies with German officers and African enlisted men
The Battle of Lake Tanganyika: battle for control of the most important lake in German East Africa
The War in Africa
Background
In the 1880s, Germany established four colonies in Africa during the “Scramble for Africa”: Kamerun (Cameroon), Togoland (Togo), German Southwest Africa (Namibia), and German East Africa (Tanzania). Of the four, German East Africa proved the most important before, and during World War I. It had a large and thriving population, developed infrastructure, cash crops, and gold mining. As important as the products produced was the fact that German East Africa was geographically nestled in a coveted area among Africa’s three Great Lakes: Victoria, Tanganyika, and Malawi. These lakes provided easy and efficient transportation of goods, and later people and armaments. They also helped create a bio-rich region in which plants and animals thrived. Because of its network of sweeping lakes and rivers that connected to the sea, the region was highly coveted by Europeans.
Early Campaigns
When war broke out in Europe in August 1914, war quickly followed into Africa. The King's African Rifles (KAR) built the basis of the British forces in the war in Africa. A pre-war creation, the KAR consisted of white, British officers, and black African enlisted troops from throughout the British colonies called askaris. Similarly, the Germans doubled the size of their colonial force—the Schutztruppe—and widely recruited askari troops.
The world of the askaris was very fluid and complex on both sides of the war. Hundreds of ethnicities from the African colonies served as askari troops. From German East Africa alone, there were nearly one hundred distinct African clans that served as askaris in the colonial army. Reports indicate that the Germans used them more widely than the British, who also had a formal army. By the start of the war, the Germans had recruited over 14,000 askaris for service in the Schutztruppe. By the end of the war, the Germans and Allies combined would enlist over 100,000 askaris.
The askaris serving in the German colonial army were paid relatively well and were trained by German officers. In their effort to recruit troops, the Germans frequently connected combat and service to the ideas of African masculinity and provided them with food and wine. The askaris were also allowed to bring their family members with them as camp followers. On each side of the war, askaris were issued uniforms and armaments. Askari troops in the King’s African Rifles were dressed in tan uniforms with a red cummerbund and fez hat, usually red. The askaris in the German Schutztruppe were likewise dressed in tan uniforms and fezzes, often red or tan.
Combat took place in all four of the German colonies. Togoland was the first German colony to surrender to the British and French troops. With next to no military force in the colony, the Germans surrendered within three weeks, and Togoland was divided between the British and French. The German colonies of German Southwest Africa and Kamerun were likewise invaded and fell to the Allies by 1916. From afar, it looked as if the Allies had won World War I in Africa by 1916. But there was one colony that they could not defeat: German East Africa.
The German East Africa Campaign
German East Africa was located largely in Tanzania, an area rich with mountains, lakes and rivers, rainforests, and plains. Over the course of their colonial administration, the German forces and commanders had learned the terrain well, and their knowledge of the area proved essential in World War I.
The terrain played a significant role in the German’s success in German East Africa, but they had another significant advantage. General Paul von Lettow-Voerbeck was the archetype of what a German officer should be: educated, disciplined, gentlemanly, a tactician, and an excellent judge of character. As a personal hobby, Lettow-Vorbeck had also closely studied East Africa’s terrain. Through his command, the German army would evade, engage, and defeat the Allies time and again for over four years in German East Africa.
The Battle of Tanga
In November 1914, the Allies blockaded Tanga, a German port city perched high on a plateau on the East African coast. Confident of a swift victory, the British mistakenly announced their intentions to attack Tanga publicly. News of the impending attack was printed in the newspapers, giving the Germans time to fortify the area.
The British forces outnumbered the German forces 8:1. When the attack came, they felt sure of an easy victory. Troops descended on the beaches at Tanga, unaware that the Germans were reinforced and stationed in the high ground above the coast. What ensued was one of the worst defeats for the Allies during the war. The Battle of Tanga quickly dissolved into a turkey shoot for the Germans. Gunfire rained down on the advancing Allies from the German forces who were positioned high above them.
Then, an unexpected adversary joined the fight. In their charge up the heights, the British troops had unknowingly run straight into nests of bees. Enormous swarms of infuriated bees attacked the Allies and their horses. Men reported that as many as 300 stings could be on one man, and at least one horse was stung to death. For this reason, the Battle of Tanga is frequently called, “The Battle of the Bees”. Allied troops were forced to retreat, leaving their dead and much of their military equipment behind.
Once the dust and bees had settled, and the Allied troops retreated, Lettow-Vorbeck led his troops down to the water. They collected the abandoned weapons and ammunition. At the end of the day, the Battle of Tanga was a major German victory. Moreover, Lettow-Vorbeck seemed to be carrying-out his larger goal: keeping the Allies, especially the British, “tied up” so that the Germans could achieve victories in Europe.
The Battle of Lake Tanganyika
In 1915, the British set their sights on a major German target: Lake Tanganyika, which was famous for being the second deepest lake in the world. The Germans dominated the lake with the use of their converted gunboat: the Graf von Goetzen. By controlling the lake, the Germans were able to move troops and supplies easier and faster than the Allies, thus giving them a strong advantage in German East Africa.
In December 1915, the British ordered that the lake be taken, even though it seemed as impossible plan. The British decided to carry two of their small, armed boats overland to Lake Tanganyika. The plan seemed preposterous because it required British troops to carry the boats Mimi and Toutou (in English, “Meow” and “Woof woof”) all the way from South Africa to Tanzania through the African jungles.
To lead this effort, the British appointed lieutenant commander, Geoffrey Spicer-Simson. Spicer-Simson inspired awe and fierce loyalty in his troops, but he was described by colleagues as extremely eccentric. Covered in tattoos of snakes, plants, and other animals, he smoked monogramed cigarettes and wore a khaki drill skirt. With teams of oxen and hundreds of porters, the British floated and hauled the two gunboats overland between December 1915 – July 1916.
When the boats were launched in late July, the British quickly defeated two of the smaller German gunboats on Lake Tanganyika, but the Graf von Goetzen escaped. Later, it was scuttled by the Germans and sunk. For the first time in over two years, the Germans lost control of the lake. For the remainder of the war, the British and Belgians controlled East Africa’s most important lake.
The Hunt for Lettow-Vorbeck
After the German defeat on Lake Tanganyika, Lettow-Vorbeck realized he could not win the battle for German East Africa in conventional terms. Mainly because the British had a new, excellent commander in Jan Smuts. A South African native, Smuts was every bit Lettow-Vorbeck’s equal. Years later, Lettow-Vorbeck would write, “When Smuts arrived, we really began to fight.” Ironically, the two men became friends at the end of World War I and remained so for the rest of their lives.
For the final two years of the war, though, Lettow-Vorbeck adopted guerilla warfare. Rather than engage the British in direct battles, the Germans would fight strategically. Lettow-Vorbeck recognized that it was better to surrender specific positions, rather than be militarily defeated, and he never lost sight of the goal of “tying up the British army.” Battles erupted, and before the British could capture and defeat the German forces, they would retreat. Any armaments or supplies were burned by the retreating Germans. The last years of the war resulted in a cat and mouse game with the British chasing after Lettlow-Vorbeck in the dense jungles and rugged mountains. Ultimately, the British would never catch Lettow-Vorbeck and his troops; their leader had far superior knowledge of the terrain and consistently used it to his advantage.
Daily Life in the German East Africa Campaign
The war in Africa tried the European forces, especially the British. It was a war unlike any that they had ever encountered. Firstly, the terrain was fierce, and the British intelligence was extremely poor. The weather was violent—extremely hot and often soggy with torrential rains.
Pests of all shapes and sizes pursued the British and German troops. Telegraph wires had to be strung exceptionally high to avoid giraffe collisions. River crossings were feared because of the sharp-nosed crocodiles. Snakes and rats were everywhere. And the insects were relentless. Chiggers, fleas, and lice infested soldiers, bringing with them a multitude of diseases. Medics reported that the chiggers would eat away a soldier’s toes, leaving the rest of the foot as a “dirty mass of putrefying rags.” Mosquitoes swarmed the troops, which resulted in rampant malaria. Soldiers would contract the disease and erupt in a fever of 104 – 105 degrees, excreting dark, bloody urine. Even five doses of quinine a day was not enough for most soldiers to endure the disease. Most horrifying to the troops were the invisible parasites—notably the guinea worms. These parasites were found in the water. If not properly boiled, unknowing soldiers would drink water filled with the parasites. A few days later, their bodies would erupt in boils. When popped, a tiny maggot would start to emerge. To make matters worse, soldiers learned they could not immediately extract the worm because it would break, spilling eggs into their bloodstream. Instead, they had to slowly extract the parasite by winding it around a twig, a little at a time, each day until the worm was removed.
Outside of the challenges produced by the weather, pests, and terrain, soldiers were frequently malnourished and hungry. Supplies ran short, and when they could be procured, were often tinned meat and biscuits. This forced the troops to survive off the land. Hippopotamus meat was described as tasting like “sweet, stewed beef.” Mangoes, unknown fruits, and berries were eaten to supplement their diets. But it was also not uncommon for soldiers to boil leather and consume it and make “pies” out of bush rats. Famously, a British soldier reported that a donkey had died from disease. They buried the donkey; then, three days later, they dug it up and ate it.
End of the War
Despite their best efforts, the British and their allies from Belgium and France never captured Lettow-Vorbeck or defeated his army. The war in East Africa continued when the ceasefire in Europe was declared on November 11, 1918. It took nearly two weeks longer for a ceasefire to be established in Africa. Lettow-Vorbeck and his army relinquished their arms to the British. Later, he returned to Germany where he lived the rest of his life.
World War I in Africa was significant, and far more than just “Mimi and Toutou.” It involved hundreds of different ethnicities—more than any other front in the war. Well over 100,000 African troops were enlisted in the services of the Germans or Allies. It also was the one theater of war where a German army was never militarily defeated. Tragically for the Africans, their territory was frequently destroyed by combat and their soldiers treated as inferiors. Many of the African cultures were changed by the war, their livestock and infrastructure destroyed, but the Europeans refused to allow Africans to govern themselves until after World War II. Under the 1919 Treaty of Versailles, Germany was forced to give-up their colonies. The British, French, and Belgians would divide former German territory and rule it in their stead.
Attributions
Images courtesy of Wikimedia Commons
Farwell, Bryon. The Great War in Africa: 1914-1918. W.W. Norton & Company, 1989.
Krech, Hans. Die Kampfhandlungen in den ehemaligen deutschen Kolonien in Africa während des 1. Weltkrieges (1914-1918). Berlin: Dr. Köster, 1999.
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oercommons
|
2025-03-18T00:36:47.282946
|
Neil Greenwood
|
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"url": "https://oercommons.org/courseware/lesson/87963/overview",
"title": "Statewide Dual Credit World History, European Imperialism and Crises 1871-1919 CE, Chapter 12: World War I in the West, East, and Colonies, More than Mimi and Toutou: World War I in Africa",
"author": "Anna McCollum"
}
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https://oercommons.org/courseware/lesson/88111/overview
|
Contemporary Africa
Overview
Africa in the Post-Cold War World
The end of the Cold War brought about a dramatic shift in governments across Africa. No longer did the United States and Russia compete for territory in Africa. In the 1990s, African nations in the Sub-Saharan region of the continent moved away from military dictatorships to multi-party states striving toward democracy. The transition was seldom smooth, but African leaders were fighting to establish their own governments, for the first time in decades without foreign intervention. In contrast, North African nations did not follow the democratic path that countries such as Zambia had. Instead, their populations, who were largely Muslim, rejected Western doctrine in favor of sharia law. However, in North Africa, too, countries established governments without direct foreign intervention for the first time in decades.
Learning Objectives
- Compare and contrast the processes of modernization in North and Sub-Saharan Africa.
- Evaluate the successes and challenges of contemporary African politics.
Key Terms / Key Concepts
African National Congress: most important political party of South Africa that advocated for the abolition of apartheid, unity between races, and full voting rights for black South Africans
African Union: political and governmental organization similar to the European Union in which major decisions involving continental Africa are evaluated
Arab Spring: series of violent, social and political uprisings by the people against the governments of much of the Muslim world during 2010 – 2012
Democratic Republic of Congo: the state in central Africa, formerly Zaire, formed in 1997
Hosni Mubarak: president of Egypt during the Arab Spring
John Garang: politician from southern Sudan who was instrumental in advocating for
Sudanese unity, and the protection and interests of southern Sudanese people
Joseph Kabila: president of the DRC from 2001 – 2019
Laurent Kabila: president of the DRC from 1997 – 2001 who was assassinated by his bodyguard
Libyan Civil War: Feb. to Oct. 2011 conflict that pitted forces that supported the Gaddafi regime wit anti-Gaddafi forces
sharia law: Muslim code of conduct based on teachings of Muhammed in the Qu’ran and the Sunnah
Sudanese Civil Wars: series of civil wars in Sudan between its northern and southern halves
South Sudan: the youngest country in the world, formed in 2011
The Arab Spring
In the 2010s, much of the Arab world experienced political and social unrest. Across North Africa and into the Middle East, people rioted against economic downturns and corrupt governments. The Arab Spring saw the removal of several heads of state. Beginning in Tunisia, the movement spread, often violently, across Libya, Egypt, Bahrain, Syria, and Yemen. Smaller insurrections occurred throughout the Arab world. Out of these social and political movements, several large-scale conflicts erupted such as the Egypt Crisis, the Libyan Civil War, and the Syrian Civil War. In several cases, the heads of state used extreme military force to suppress the rioters. By mid-2012, the Arab Spring largely had ended.
Egypt
Egypt was an ideal country for the Arab Spring to take hold because it was a discontented country on the road to revolution. It was the most populous country in North Africa, and its president, Hosni Mubarak, had governed since 1981. Mubarak had stripped Egypt of many of its progressive measures. In place of the liberalizing government of Anwar Sadat, Mubarak had instituted a government that was militaristic and autocratic.
Moreover, the Egyptian government had to pay for the massively expensive army they had created during the wars against Israel in the 1960s and 1970s. While supporting the costs of the military, the government neglected their attention on the agricultural sector. Food shortages plagued Egypt and forced the country to import up to 80% of its foodstuffs, as well as form close economic ties to the United States, International Monetary Fund, and World Bank. Unemployment and urban slums defined Cairo, Egypt’s capital.
By the 1990s, radical Muslim groups had also moved increasingly into Egypt and launched terror attacks on tourists, decimating the tourist industry. As their presence increased, Mubarak’s ability to control the groups decreased.
Revolution came in January 2011. Thousands of Egyptians filed into Cairo’s Tahrir Square to protest Mubarak’s government. Initially, President Mubarak resisted the protesters, and promised constitutional reform. Doubting his promise, the protesters increased in their demands. Violent clashes erupted between groups who supported president Mubarak, and those who supported the opposition. Within four weeks, Mubarak resigned, and the military took power in Egypt.
Mubarak was later tried for corruption, murder, and embezzlement. While he was acquitted of most charges, he was sentenced to three years in prison. Due to increasing health problems, he spent his final months in a military hospital where he died in 2020. To date, Egypt is governed by authoritarian president, Abdul Fattah el-Sisi, in ways similar to those of Mubarak.
Libya
In the spring of 2011, the Arab Spring was unleashed in Libya where long-time military dictator Muammar Gaddafi was ruling. Protests against his rule started as small demonstrations in Benghazi, but quickly escalated. When the demonstrators refused to disperse, Gaddafi unleashed the Libyan military on them. Briefly, it looked as if the Libyan military would triumph.
Then, the UN Security Council granted NATO permission to establish a No-Fly Zone over Libya. This gave NATO the right to shoot down any aircraft flying over Libyan airspace. Other Arab states supported the measure enacted by NATO in order to check Gaddafi’s military strikes on the Libyan people.
By February 2011, the first Libyan Civil War had erupted. It pitted the forces loyal to Gaddafi against the anti-Gaddafi forces and their NATO allies. NATO forces, led by Britain and France, and supported by anti-Gaddafi forces in Libya, targeted all military bases operating under Gaddafi. In October 2011, Libyan forces captured the city of Tripoli, and Gaddafi’s hometown of Sirte. Gaddafi was then captured, and brutally executed.
In 2014, the Second Libyan Civil War erupted between vying political factions. Many of the forces who had been loyal to Gaddafi remained so. Other political factions contested election results. For six years civil war raged in Libya until the formation of a new, interim government in 2021.
Social Challenges and Prosperity in Nigeria
Nigeria is the most populous country in Africa, and it rests on Africa’s west coast. It is a bio-rich country of rainforest, mountains, and dry savannahs. It is also one of the most ethnically, linguistically, and religiously diverse countries in Africa, boasting the largest mixed economy.
In the 1999, Nigeria emerged as a fledgling democratic country with a constitution, free elections, and houses of government. But the road to democracy has not been smooth or easy, as corruption continues to run high in politics at the local and national levels. Religious tensions have developed between the north, a largely Muslim part of the country, and the south, which was largely Christian. The northern states of Nigeria operate under sharia law while the southern half operates under a common law.
Despite religious tension, and political corruption, Nigeria has emerged as one of Africa’s most prosperous and strong states. Its economy continues to grow, based off such industries as the petroleum industry and mining of precious minerals: topaz, gold, and tin.
The Civil Wars in Sudan
Since the mid-1950s, there have been a series of Sudanese Civil Wars. In their simplest understanding, the wars in Sudan have been fought between the (largely) Arab/Muslim North and the Christian/African South. For decades, South Sudan fought for independence from the North. The conflict in Sudan rose sharply in 1983 when oil reserves were discovered just south of the traditional boundary between the northern and southern parts of the country.
In 1989, the government of Ahmad al-Bashir tried to establish an Islamic state in Sudan. This further encouraged the south Sudanese to fight for independence. They abolished sharia law, while the northern half of the country still clung to it. Then, in a surprise move, Sudan held a free election in which al-Bashir was elected president.
For the next eighteen years, the conflict between the northern and southern parts of Sudan raged. Oil revenues allowed for the purchase of mass ammunitions to fight the conflict. In 2005, a “power-sharing” agreement between the northern and southern parts of the country was reached. At the time, al-Bashir appointed John Garang as his vice-president; Garang is a politician from southern Sudan who advocated for a unified Sudan above all other things. A peace-settlement was established in which al-Bashir agreed to share power with Garang. But three months later, Garang died in a helicopter crash.
In 2011, the people were offered a referendum that allowed the Sudanese to vote for separation. Overwhelmingly, the people in the south voted in favor of separating from Sudan. In July 2011, South Sudan became an independent country. But tragedy soon struck. Two years later, the country was torn by civil was that raged until 2020 when a fragile peace was achieved.
The Coming of the Democratic Republic of Congo
The Democratic Republic of Congo (DRC) is the heart of Africa. It is a landlocked country in the center of the continent that continues to be enormously wealthy in its natural resources, including copper, cobalt, diamonds, rubber, and wood. Equally, it is rich in its biodiversity, and in its cultural diversity. Despite its resources and richness, the Democratic Republic of Congo’s recent history is fraught with internal and external wars, and excessive violence.
Following the Rwandan Genocide of the mid-1990s, the Rwandan Army helped support a rebellion in Zaire (later, the DRC) to remove Rwandan Hutu rebels who were hiding in the country. The leader of Zaire, Mobutu Sese Seko, was deposed and his government dissolved. Congolese military leader, Laurent Kabila, was instilled as president, and the country’s name changed from Zaire to the Democratic Republic of Congo.
Kabila expelled foreigners from Congo. The act angered his Ugandan and Rwandan allies and war erupted in Congo once more.
Three years later, Kabila was assassinated by his personal bodyguard. His son, Joseph Kabila succeeded him as president and governed from 2001 – 2019. During his time in office, civil war plagued the country, and continuous warfare between Congo and its eastern neighbors raged.
For the first time in more than a century, Congo experienced its first peaceful election in 2019.
South Africa's New Start
It was Nelson Mandela’s mission to unite the races of South Africa on equal footing and to erase racial boundaries. Since the 1990s, reconciliation between the races has proven largely successful. While race relations improved and apartheid was abolished, class boundaries still existed in South Africa. Black South Africans were no longer physically barred from business ventures and professional practices. But unemployment rose in the early 2000s among both black and white South Africans. Black Africans have joined the middle class of South Africa, but the gap between classes continues to increase.
Politically, South Africa faces many challenges. One of its greatest achievements has been the strong standing of its chief political party: the African National Congress. Banned until 1990 by the South African government, the African National Congress advocated for unity among the races, full voting rights to black South Africans, and an end to apartheid. It was the party of Nelson Mandela, and it continues to be the dominant party in South Africa.
After Nigeria, South Africa has the largest mixed economy in Africa. Although unemployment and pay inequality remain significant challenges, South Africa has produced strong developments in medicine and technology. Tourism and mining remain two of its largest and most prosperous industries.
In 2010, South Africa became the first African nation to host the FIFA World Cup.
China Turns to Africa
In the 1960s, China turned its attention to investment in Africa for the first time since the 1500s. It made small investments in support of communist-backed nations, such as Tanzania. And small financial investments in infrastructure projects.
Then in the early 2000s, China emerged as the fastest-growing economic and industrial power. It began heavily investing in mining operations throughout Africa. In Congo alone, it invested in half of all of the country’s mining and natural resource industries. By 2010, it was the largest investor of the African continent, far surpassing European investment in Africa. Its financial power in Africa has led South Africa to join BRIC—an economic and trading alliance between Brazil, Russia, India, and China.
Both nationally, and in the private business world, China continues to invest heavily in Africa, particularly in infrastructure projects and in mining. The natural resources mined in Africa are of critical importance to China’s technology and information sectors. While financial investment has spurred on economic growth for many African nations, human rights organizations are critical of Chinese treatment of African workers. Many groups claim that China is simply exploiting the African people, and that once again, Africa is being financially exploited by a modern-day colonizer.
New Millennium, New Goals for Africa
Following the Cold War, most African nations supported non-alignment with foreign powers, and membership in the African Union—a political organization that promotes Pan-Africanism. Although many countries still face poverty and war, other countries such as Nigeria and South Africa seem on the brink of a new era. An era in which African nations govern and operate independently. An era which prosperity is not a dream, but an emerging reality.
Attributions
Images courtesy of Wikimedia Commons
Shillington, Kevin. History of Africa, 3rd Ed. Palgrave MacMillan, New York: 2012. 458
481.
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oercommons
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2025-03-18T00:36:47.326863
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Neil Greenwood
|
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"url": "https://oercommons.org/courseware/lesson/88111/overview",
"title": "Statewide Dual Credit World History, The Catastrophe of the Modern Era: 1919-Present CE, Chapter 17: Post-Cold War International Structure, Contemporary Africa",
"author": "Anna McCollum"
}
|
https://oercommons.org/courseware/lesson/88099/overview
|
Tiger Economies
Overview
Tiger Economies
Since the end of the Cold War in the 1990s and 2000s, certain Asian countries (the so-called “Tigers”) have emerged as competitors to Europe and the United States as great economic powers.
Learning Objectives
- Identify the reasons for the emergence of the “Tiger” economies.
- Examine the political, economic, and social issues facing these rising Asian nations.
- Analyze the differences between North Korea and these “Tiger” economies.
Key Terms / Key Concepts
bamboo network: a term used to conceptualize connections between certain businesses operated by overseas Chinese in Southeast Asia
Four Asian Tigers: a collective name used to refer to the economies of Hong Kong, Singapore, South Korea, and Taiwan, which underwent rapid industrialization and maintained exceptionally high growth rates between the early 1960s and 1990s
G7: a group consisting of Canada, France, Germany, Italy, Japan, the United Kingdom, and the United States (These countries are the seven major advanced economies as reported by the International Monetary Fund and represent more than 64% of the net global wealth—$263 trillion.)
socialist oriented market economy: the economic model employed by the People’s Republic of China, which is based on the dominance of the state-owned sector and an open-market economy and has its origins in the Chinese economic reforms introduced under Deng Xiaoping
Tiger Cub Economies: a collective term used to refer to the economies of Indonesia, Malaysia, the Philippines, Thailand and Vietnam, the five dominant countries in Southeast Asia; a group so named because they follow the same export-driven model of economic development pursued by the Four Asian Tigers
Yasukuni Shrine: a Shinto shrine that memorializes Japanese armed forces members killed in wartime constructed during the Meiji period to house the remains of those who died for Japan
The Rising Economies of East Asia
The economy of East Asia is one of the most successful regional economies of the world. The changes that turned the area into the economic power began with the Meiji Restoration in the late 19th century when Japan rapidly transformed into the only industrial power outside Europe and the United States. Japan’s early industrial economy reached its height during World War II and its eventual defeat in the war slowed down economic development for a relatively short period of time. Japan’s economy recovered already in the 1950s and by the 1980s, the country was the world’s second largest economy.
Other East Asian countries followed with their own reforms and resulting “economic miracles”; today, East Asia is home of some of the world’s largest and most prosperous economies, including Mainland China, Hong Kong, Macau, Taiwan, Japan, and South Korea. Major growth factors have ranged from favorable political and legal environments for industry and commerce, through abundant natural resources, to plentiful supplies of relatively low-cost, skilled, and adaptable labor. Local populations have rapidly adjusted to the requirements of new technologies and scientific discoveries, while also demonstrating exceptional work ethics. The region’s economic success has led the World Bank to dub it an East Asian Renaissance.
Although technically not seen as part of the East Asian Renaissance, India, associated more closely with the South Asian region, has become an equally thriving and critical Asian member of the global economy in the last several decades.
Japan
In the three decades of economic development following 1960, Japan ignored defense spending in favor of economic growth, thus allowing for a rapid economic growth referred to as the Japanese post-war economic miracle. With average growth rates of 10% in the 1960s, 5% in the 1970s, and 4% in the 1980s, Japan was able to establish and maintain itself as the world’s second largest economy from 1978 until 2010, when it was surpassed by the People’s Republic of China.
The economy of Japan is the third largest in the world by nominal GDP, the fourth-largest by purchasing power parity (PPP), and the world’s second largest developed economy. Japan is thus a member of the G7. Due to a volatile currency exchange rate, Japan’s GDP as measured in dollars fluctuates widely. Accounting for these fluctuations, Japan is estimated to have a GDP per capita of around $38,490.
Japan is the world’s third largest automobile manufacturing country, has the largest electronics goods industry, and is often ranked among the world’s most innovative countries leading several measures of global patent filings. Facing increasing competition from China and South Korea, manufacturing in Japan today focuses primarily on high-tech and precision goods, such as optical instruments, hybrid vehicles, and robotics. Japan is the world’s largest creditor nation. It generally runs an annual trade surplus and has a considerable net international investment surplus. In 2015, 54 of the Fortune Global 500 companies were based in Japan.
The Japanese economy faces considerable challenges posed by a dramatically declining population. Statistics showed an official decline for the first time in 2015, while projections suggest that it will continue to fall from 127 million down to below 100 million by the middle of the 21st century. A mountainous, volcanic island country, Japan has inadequate natural resources to support its growing economy and large population. Therefore, Japan exports goods, which are highly valued across the world. Japan exports engineering-oriented, research, and development-led industrial products and imports raw materials and oil. Japan is among the top-three importers for agricultural products in the world next to the European Union and United States in total volume for covering of its own domestic agricultural consumption.
Japan in the World
Since the late 1990s, the U.S.-Japan relationship has improved and strengthened. The major cause of friction in the relationship, trade disputes, became less problematic as China displaced Japan as the greatest perceived economic threat to the United States. Meanwhile, although in the immediate post-Cold War period the security alliance suffered from a lack of a defined threat, the emergence of North Korea as a belligerent rogue state and China’s economic and military expansion provided a purpose to strengthen the relationship. While the foreign policy of the administration of President George W. Bush put a strain on some of the United States’ international relations, the alliance with Japan became stronger, as evidenced by the Deployment of Japanese troops to Iraq and the joint development of anti-missile defense systems.
The Okinawa Controversy
Okinawa is the site of major American military bases that have caused problems, as Japanese and Okinawans have protested their presence for decades. In secret negotiations that began in 1969, Washington sought unrestricted use of its bases for possible conventional combat operations in Korea, Taiwan, and South Vietnam, as well as the emergency re-entry and transit rights of nuclear weapons. However, anti-nuclear sentiment was strong in Japan and the government wanted the United States to remove all nuclear weapons from Okinawa. In the end, the United States and Japan agreed to maintain bases that would allow the continuation of American deterrent capabilities in East Asia. When the Ryukyu Islands, including Okinawa, reverted to Japanese control in 1972, the United States retained the right to station forces on these islands. A dispute that had boiled since 1996 regarding a base with 18,000 U.S. Marines was temporarily resolved in late 2013. Agreement was reached to move the Marine Corps Air Station Futenma to a less-densely populated area of Okinawa.
As of 2014, the United States still had 50,000 troops in Japan and the headquarters of the U.S. 7th Fleet, including more than 10,000 Marines. Also in 2014, it was revealed the United States was deploying two unarmed Global Hawk long-distance surveillance drones to Japan with the expectation they would engage in surveillance missions over China and North Korea.
Japan and Reckoning with History
In recent decades, Japan has faced increased pressure from its East Asian neighbors to be more accountable for its past actions. Despite numerous apologies for Japan’s war crimes from Japanese government representatives since World War II, repeated comments of Japanese politicians questioning the crimes, the problematic degree of formality of apologies, and retractions or contradictions by statements or actions of Japan have exposed the country’s refusal to reckon with its difficult past. Japanese war crimes occurred in many Asian and Pacific countries during the period of Japanese imperialism, primarily during the Second Sino-Japanese War, which eventually merged into World War II. Some were committed by military personnel from the Empire of Japan in the late 19th century, although most took place from the first part of the Shōwa Era, the name given to the reign of Emperor Hirohito, until the surrender of the Empire of Japan in 1945.
Some historians and governments hold Japanese military forces, the Imperial Japanese Army, the Imperial Japanese Navy, and the Imperial Japanese family, especially under Emperor Hirohito, responsible for the deaths of millions of civilians and prisoners of war through massacre, human experimentation, starvation, and forced labor either directly perpetrated or condoned by the Japanese military and government. Estimates range from 3 to 14 million victims. Airmen of the Imperial Japanese Army Air Service and Imperial Japanese Navy Air Service were not included as war criminals because there was no positive or specific customary international humanitarian law that prohibited the unlawful conduct of aerial warfare either before or during World War II. However, the Imperial Japanese Army Air Service took part in chemical and biological attacks on enemy nationals during the Second Sino-Japanese War and World War II, and the use of such weapons in warfare was generally prohibited by international agreements signed by Japan, including the Hague Conventions (1899 and 1907), which banned the use of “poison or poisoned weapons” in warfare.
Japan's Problematic Reckoning
Since the 1950s, senior Japanese Government officials have issued numerous apologies for the country’s war crimes. Japan’s Ministry of Foreign Affairs states that the country acknowledges its role in causing “tremendous damage and suffering” during World War II, especially in regard to the Nanking Massacre in which Japanese soldiers killed a large number of non-combatants and engaged in looting and rape. But unlike Germany, for example, Japan has not fully recognized the scale of its war-time atrocities, and its approach to dealing with the difficult past has caused controversy around the world. Japanese nationalist politicians engaged in efforts to whitewash the actions of the Empire of Japan during World War II. While they were not entirely successful, some Japanese history textbooks offer only brief references to various war crimes.
Critics have questioned the degree and formality of apologies and noted the issue of retractions and contradictory actions by Japan. An illustrative example is the issue of the so-called comfort women, women and girls who were forced into sexual slavery by the Imperial Japanese Army in occupied territories before and during World War II. In 1951, the South Korean government demanded $364 million in compensation for Koreans forced into labor and military service during Japanese occupation. In the final agreement reached in the 1965 treaty, Japan provided an $800 million aid and low-interest loan package over 10 years. However, the money was for the Korean government, not individuals.
Three Korean women filed suit in Japan in 1991, around the time of the 50th anniversary of the Pearl Harbor attack, demanding compensation for forced prostitution. In 1992, documents were found in the library of Japan’s Self-Defense Agency that indicated that the Japanese military played a large role in operating what were euphemistically called “comfort stations”. The Japanese Government admitted that the Japanese Army forced tens of thousands of Korean women to have sex with Japanese soldiers during World War II. On January 14, 1992, Japanese Chief Government Spokesman Koichi Kato issued an official apology. Three days later, at a dinner given by South Korean President Roh Tae Woo, Prime Minister Kiichi Miyazawa apologized to his host and the following day in a speech before South Korea’s National Assembly.
In 1994, the Japanese government set up the public-private Asian Women’s Fund (AWF) to distribute additional compensation to South Korea, the Philippines, Taiwan, the Netherlands, and Indonesia. A number of former comfort women (61 Korean, 13 Taiwanese, 211 Filipino, and 79 Dutch) were given a signed apology from Prime Minister Tomiichi Murayama. Many former Korean comfort women rejected the compensations on principle. Although the AWF was set up by the Japanese government, its funds came not from the government but from private donations, hence the compensation was not “official.” In 1998, the Japanese court ruled that the Japanese government must compensate the women and awarded them $2,300 (equivalent to $3,380 in 2016) each.
On March 1, 2007, Prime Minister Shinzō Abe stated that there was no evidence that the Japanese government had kept sex slaves, even though the Japanese government already admitted the use of coercion in 1993. On February 20, 2014, Chief Cabinet Secretary Yoshihide Suga said that the Japanese government may reconsider the study and the apology. However, Prime Minister Abe clarified on March 14, 2014, that he had no intention of renouncing or altering it. On December 28, 2015, Abe and South Korean President Park Geun-hye reached a formal agreement to settle the dispute. However, the Korean comfort women and the majority of the Korean population regarded the resolution as unsatisfying. The Korean comfort women stated that they were not protesting for money and that their goals for the formal and public apology from Abe and the Japanese government and the correction of Japanese history textbooks had not been met. In 2019 due to lack of public support, the South Korean government dissolved this agreement.
Japan and Its Neighbors
The People’s Republic of China joined other Asian countries—such as South Korea, North Korea, and Singapore—in criticizing Japanese history textbooks that whitewash Japanese war crimes in World War II. Although Prime Minister Junichiro Koizumi openly declared “deep remorse” over Japan’s wartime crimes in 2005 (the latest in a series of apologies spanning several decades), many Chinese observers regard the apology as insufficient and not backed up by sincere action because of the lack of change to Japan’s representation of history.
The PRC and Japan also continue to debate over the actual number of people killed in the Nanking Massacre. The PRC claims that at least 300,000 civilians were murdered while Japan claims 40,000 – 200,000. While a majority of Japanese believe in the existence of the massacre, a Japanese-produced documentary film released just prior to the 60th anniversary of the massacre, titled The Truth about Nanjing, denies that any such atrocities took place. These disputes have stirred up enmity against Japan from the global Chinese community, including Taiwan.
Although the Japanese government has admitted to the killing of a large number of non-combatants, looting, and other violence committed by the Imperial Japanese Army after the fall of Nanking, and Japanese veterans who served there have confirmed that a massacre took place, a small but vocal minority within both the Japanese government and society have argued that the death toll was military in nature and that no such crimes ever occurred.
Since the 1950s, many prominent politicians and officials in Japan have made statements on Japanese colonial rule in Korea, which created outrage and led to diplomatic scandals in Korean-Japanese relations. The statements have led to anti-Japanese sentiments among Koreans and a widespread perception that Japanese apologies for colonial rule have been insincere. Although diplomatic relations were established by a treaty in 1965, South Korea continues to request an apology and compensation for Korea under Japanese rule. In 2012, the South Korean government announced that Emperor Akihito must apologize for Japan’s colonial rule of the Korean Peninsula. Most Japanese prime ministers have issued apologies, including Prime Minister Obuchi in the Japan–South Korea Joint Declaration of 1998. While South Koreans welcomed the apologies at the time, many now view the statements as insincere because of continuous misunderstandings between the two nations.
In the early 1990s, Japan conducted lengthy negotiations with North Korea aimed at establishing diplomatic relations while maintaining its relations with Seoul. In September 1990, a Japanese political delegation led by former deputy Prime Minister Shin Kanemaru of the Liberal Democratic Party visited North Korea. Following private meetings between Kanemaru and North Korean leader Kim Il Sung, a joint declaration released on September 28 called for Japan to apologize and compensate North Korea for its period of colonial rule. Japan and North Korea agreed to begin talks aimed at the establishment of diplomatic relations.
In January 1991, Japan began normalization talks with Pyongyang with a formal apology for its 1910 – 45 colonial rule of the Korean Peninsula. The negotiations were aided by Tokyo’s support of a proposal for simultaneous entry into the United Nations by North Korea and South Korea. The issues of international inspection of North Korean nuclear facilities and the nature and amount of Japanese compensations, however, proved more difficult to negotiate. Prime Minister Junichirō Koizumi, in the Japan-DPRK Pyongyang Declaration of 2002, said: “I once again express my feelings of deep remorse and heartfelt apology, and also express the feelings of mourning for all victims, both at home and abroad, in the war.”
Yasukuni Shrine
Yasukuni Shrine is a Shinto shrine that memorializes Japanese armed forces members killed in wartime. It was constructed as a memorial during the Meiji period to house the remains of those who died for Japan. The shrine houses the remains of Hideki Tojo, Prime Minister and Army Minister of Japan between 1941 and 1944, and 13 other Class A war criminals. Yasukuni Shrine has been a subject of controversy, as it also a memorial for over a thousand Japanese and some Korean war criminals. The presence of these war criminals among the dead honored at Yasukuni Shrine means that visits to Yasukuni have been seen by Chinese and South Koreans as support for these war criminals of the wartime era.
Yasuhiro Nakasone and Ryutaro Hashimoto visited Yasukuni Shrine in 1986 and 1996 respectively, and both paid respects as Prime Minister of Japan, drawing intense opposition from Korea and China. Junichirō Koizumi visited the shrine and paid respects six times during his term as Prime Minister of Japan. These visits again drew strong condemnation and protests from Japan’s neighbors, mainly China and South Korea. As a result, the heads of the two countries refused to meet with Koizumi, and there were no mutual visits between Chinese and Japanese leaders after October 2001 and between South Korean and Japanese leaders after June 2005. The President of South Korea, Roh Moo-hyun, had suspended all summit talks between South Korea and Japan until 2008, when he resigned from office. Japanese prime minister, Shinzō Abe, has made several visits to the shrine, the most recent being in December 2013.
Four Asian Tigers
In addition to Japan, the other economic powers in East Asia include the “Four Asian Tigers.” the economies of Hong Kong, Singapore, South Korea, and Taiwan. These four countries underwent rapid industrialization and maintained exceptionally high growth rates (in excess of 7 percent a year) between the early 1960s (mid-1950s for Hong Kong) and 1990s. By the 21st century, all four had developed into advanced and high-income economies, specializing in areas of competitive advantage. For example, Hong Kong and Singapore have become world-leading international financial centers, whereas South Korea and Taiwan are world leaders in information technology manufacturing. Their economic success stories have served as role models for many developing countries, especially the Tiger Cub Economies.
Export policies have been the de facto reason for the rise of the Four Asian Tiger economies. The approach taken has been different among the four nations. Hong Kong and Singapore introduced trade regimes that were neoliberal in nature and encouraged free trade, while South Korea and Taiwan adopted mixed regimes that accommodated their own export industries. In Hong Kong and Singapore, due to small domestic markets, domestic prices were linked to international prices. South Korea and Taiwan introduced export incentives for the traded-goods sector. The governments of Singapore, South Korea, and Taiwan also worked to promote specific exporting industries, which were termed as an export push strategy. All these policies helped these four nations to achieve a growth averaging 7.5% each year for three decades and as such they achieved developed country status.
A controversial World Bank report (see The East Asian Miracle 1993) credited neoliberal policies with the responsibility for the boom, including maintenance of export-led regimes, low taxes, and minimal welfare states. Some state intervention has been also admitted to be a factor. However, many have argued that industrial policy had a much greater influence than the World Bank report suggested. The World Bank report itself acknowledged benefits from policies of the repression of the financial sector, such as state-imposed below-market interest rates for loans to specific exporting industries. Other important aspects include major government investments in education, non-democratic and relatively authoritarian political systems during the early years of development, high levels of U.S. bond holdings, and high public and private savings rates.
South Korea
In the first half of the 1990s, in already democratic South Korea, the economy continued a stable and strong growth. Things changed quickly in 1997 with the Asian Financial Crisis. By 1997, the IMF had approved a USD $21 billion loan, that would be part of a USD $58.4 billion bailout plan. By January 1998, the government had shut down a third of Korea’s merchant banks. Actions by the South Korean government and debt swaps by international lenders contained the country’s financial problems. Much of South Korea’s recovery from the Asian Financial Crisis can be attributed to labor adjustments (i.e. a dynamic and productive labor market with flexible wage rates) and alternative funding sources.
In the 2000s, Korea’s economy moved away from the centrally planned, government-directed investment model toward a more market-oriented one. These economic reforms helped it maintain one of Asia’s few expanding economies.
South Korea enjoys a high-income economy and massively invests in education, which has brought the country from mass illiteracy to becoming major international technological powerhouse. The country’s national economy benefits from a highly skilled workforce, and South Koreans are among the most educated societies in the world with one of the highest percentage of individuals holding a higher education degree. The South Korean economy continues to be heavily dependent on international trade and in 2014, the country was the 5th largest exporter and 7th largest importer in the world. The incredible economic development from the early 1960s to the late 1990s and becoming one of the fastest-growing developed countries in the 2000s has compelled South Koreans to refer to this growth as the Miracle on the Han River. South Korea was also one of the few developed countries that were able to avoid a recession during the global financial crisis of 2007 – 2008.
Tiger Cub Economies
The term Tiger Cub Economies collectively refers to the economies of Indonesia, Malaysia, the Philippines, Thailand, and Vietnam, the five dominant countries in Southeast Asia. They are so named because they follow the same export-driven model of economic development pursued by the Four Asian Tigers. Four countries are included in HSBC’s (United Kingdom bank) list of top 50 economies in 2050, while Vietnam, Indonesia and the Philippines are included in Goldman Sachs’s (US investment bank) Next Eleven list of economies because of their rapid growth and large population. Out of these, Vietnam has been determined to become possibly the fastest growing of the world’s emerging economies by 2020. Similarly to China, the country’s socialist-oriented market economy is a developing planned economy and market economy. In the 21st century, Vietnam is in a period of being integrated into the global economy. It has become a leading agricultural exporter and served as an attractive destination for foreign investment in Southeast Asia.
Overseas Chinese entrepreneurs played a prominent role in the development of the region’s private sectors. These businesses are part of the larger “bamboo network,” a network of overseas Chinese businesses operating in the markets of Malaysia, Indonesia, Thailand, Vietnam, and the Philippines that share common family and cultural ties. China’s transformation into a major economic power in the 21st century has led to increasing investments in Southeast Asian countries where the bamboo network is present.
India and North Korea
India has emerged as an economic power since the the 1990s, whereas North Korea, unlike South Korea and other states in East Asia, has become increasingly isolated internationally under a brutal dictatorship.
Key Terms / Key Concepts
BRICS: the acronym for an association of five major emerging national economies (Brazil, Russia, India, China, South Africa)
Global Hunger Index: an index that places a third of weight on proportion of the population that is estimated to be undernourished, a third on the estimated prevalence of low body weight to height ratio in children younger than five, and remaining third weight on the proportion of children dying before the age of five for any reason
G-20: an international forum for the governments and central bank governors from 20 major economies founded in 1999 with the aim of studying, reviewing, and promoting high-level discussion of policy issues pertaining to the promotion of international financial stability
License Raj: the elaborate system of licenses, regulations, and accompanying red tape required to set up and run businesses in India between 1947 and 1990
North Korean famine: a famine that killed somewhere between 240,000 and 3.5 million North Koreans between 1994 and 1998
Sunshine Policy: the foreign policy of South Korea towards North Korea from 1998 to 2008
India after the Cold War
In 1991, two events resulted in a major balance-of-payments crisis for India: the collapse of their major trading partner, Soviet Union, and the Gulf War, which caused a spike in oil prices. As a result, India found itself facing the prospect of defaulting on its loans. The country asked for a $1.8 billion bailout loan from the International Monetary Fund (IMF), which in return demanded deregulation. In response, Prime Minister Narasimha Rao, along with his finance minister Manmohan Singh, initiated economic liberalization in 1991. The reforms did away with the License Raj (a system of licenses, regulations, and accompanying red tape required to set up and run businesses), reduced tariffs and interest rates, and ended many public monopolies, allowing automatic approval of foreign direct investment in many sectors. Since then, the overall thrust of liberalization has remained the same, although no government has tried to take on powerful lobbies. By the turn of the 21st century, India had progressed towards a free-market economy, with a substantial reduction in state control of the economy and increased financial liberalization.
Currently, the economy of India is the sixth largest in the world measured by nominal GDP and the third largest by purchasing power parity (PPP). The country is classified as a newly industrialized country, one of the G-20 major economies, and a member of BRICS. It is a developing economy with an average growth rate of approximately 7% over the last two decades.
Maharashtra is the wealthiest Indian state and has an annual nominal GDP of $330 billion US, nearly equal to that of Portugal and Pakistan combined. Additionally, it accounts for 12% of the Indian GDP followed by the states of Tamil Nadu ($150 billion US) and Uttar Pradesh ($130 billion US).
India’s economy was the world’s fastest growing major economy in the last quarter of 2014, replacing the People’s Republic of China. India has one of the fastest growing service sectors in the world with an annual growth rate of above 9% since 2001, which contributed to 57% of GDP in 2012 – 13. India has become a major exporter of IT (Information Yechnology) services, business process outsourcing services, and software services, with $167.0 billion worth of service exports in 2013 – 14. It also became the fastest-growing part of the economy. The IT (Information industry) thus became the largest private sector employer in the country. At that time, India emerged as the third largest start-up hub in the world with over 3,100 technology start-ups in 2014 – 15. The agricultural sector remained the largest employer in India’s economy but contributed to a declining share of its GDP (17% in 2013 – 14). India ranked second worldwide in farm output. The industry sector has held a constant share of its economic contribution (26% of GDP in 2013 – 14). The Indian automobile industry became one of the largest in the world with an annual production of 21.48 million vehicles (mostly two- and three-wheelers) in fiscal year 2013 – 14. India had $600 billion worth of the retail market in 2015, and one of world’s fastest growing e-commerce markets.
Outcomes of Economic Development
India’s agricultural sector today still faced issues of efficiency due to lack of mechanization and small farmers who live in poor conditions. In India, traditional agriculture remained dominant as many farmers depended on livestock in crop production, for both the produced manure and their use as manual ploughs. According to 2011 statistics, the average farm in India was about 1.5 acres, minuscule when compared to the average of 50 hectares in France, 178 hectares in United States, and 273 hectares in Canada.
Despite the impressive accomplishments of the Green Revolution, India has continued to face massive socioeconomic challenges. In 2006, India contained the largest number of people living below the World Bank’s international poverty line of $1.25 US per day, the proportion having decreased from 60% in 1981 to 42% in 2005 and 25% in 2011. According to a Food and Agriculture Organization report in 2015, 15% of the Indian population was undernourished. Since 1991, economic inequality between India’s states has consistently grown: the per capita net state domestic product of the richest states in 2007 was 3.2 times that of the poorest.
Global Hunger Index (GHI) measures hunger by placing a third of weight on proportion of the population that is estimated to be undernourished, a third on the estimated prevalence of low body weight to height ratio in children younger than five, and the remaining third on the proportion of children dying before the age of five for any reason. According to 2011 GHI report, India had improved its performance by 22% in 20 years, from 30.4 to 23.7 over the 1990 – 2011 period. However, its performance from 2001 to 2011 showed little progress, with just 3% improvement. A sharp reduction in the percentage of underweight children has helped India improve its hunger record on the Global Hunger Index (GHI) 2014. Between 2005 and 2014, the prevalence of underweight children under the age of five fell from 43.5% to 30.7%.
In 2012, the National Crime Records Bureau of India reported 13,754 farmer suicides. Farmer suicides accounted for 11.2% of all suicides in India. Activists and scholars have offered a number of conflicting reasons for this phenomenon, such as monsoon failure, high debt burdens, genetically modified crops, government policies, public mental health, personal issues, and family problems.
India has made huge progress in terms of increasing the primary education attendance rate and expanding literacy to approximately three-fourths of the population. The literacy rate grew from 52.2% in 1991 to 74.04% in 2011. The right to education at elementary level has been made fundamental, and legislation has been enacted to further the objective of providing free education to all children. However, the literacy rate of 74% was still lower than the worldwide average and the country suffered from a high drop-out rate (impacted by economic challenges faced by the poorest segments of the society). Further, the literacy rates and educational opportunities varied greatly by region, gender, urban and rural areas, and among different social groups.
There is a continuing debate on whether India’s economic expansion has been pro-poor or anti-poor. Studies suggest that the economic growth has reduced poverty in India, although it remains at a substantial level. In 2012, the Indian government stated 21.9% of its population is below its official poverty threshold. According to United Nation’s Millennium Development Goal (MDG) program, 270 million or 21.9% people out of 1.2 billion of Indians lived below poverty line of $1.25 in 2011 – 2012 as compared to 41.6% in 2004 – 05. It is important to note, however, that the World Bank and UN-accepted poverty line is very low and many of those whose purchasing power falls above it still face massive economic struggles.
A critical problem facing India’s economy is the sharp and growing regional variations among India’s different states and territories in terms of poverty, availability of infrastructure, and socioeconomic development. Severe disparities exist among states in terms of income, literacy rates, life expectancy, and living conditions.
After liberalization, the more advanced states have been better placed to benefit, with well-developed infrastructure and an educated and skilled workforce that attract the manufacturing and service sectors. The governments of less-advanced regions are trying to reduce disparities by offering tax holidays and cheap land. These state governments have focused more on sectors like tourism, which, although geographically and historically determined, can become a source of growth and develop faster than other sectors.
Corruption has been one of the pervasive problems affecting India. A 2005 study by Transparency International (TI) found that more than half of those surveyed had firsthand experience of paying bribes or peddling influence to get a job done in a public office over the previous year. In 1996, bureaucracy and the License Raj were suggested as a cause for the institutionalized corruption and inefficiency. More recent reports suggest the causes include excessive regulations and approval requirements, mandated spending programs, monopoly of certain goods and service providers by government-controlled institutions, bureaucracy with discretionary powers, and lack of transparent laws and processes. The Right to Information Act (2005) is a law that requires government officials to furnish information requested by citizens or face punitive action; it, along with computerization of services and various central and state government acts that established vigilance commissions, have reduced corruption and opened avenues to redress grievances.
In 2011, the Indian government concluded that most spending fails to reach its intended recipients. A large, cumbersome bureaucracy sponges up or siphons off spending budgets. India’s absentee rates are one of the worst in the world. One study found that 25% of public sector teachers and 40% of government-owned public sector medical workers could not be found at the workplace. Similarly, there are many issues facing Indian scientists, with demands for transparency, hiring based on merit, and an overhaul of the bureaucratic agencies that oversee science and technology.
Despite the impressive economic growth, India continues to experience many social issues, many associated with countries that lag economically. These include the lack of proper sanitation, debt bondage and other forms of bonded labor, child labor, child marriage, gender-based violence, and poor access to quality health care and education faced by a substantial segment of the caste-based society.
North Korea
North Korea has remained committed to its Marxist-Leninist ideology with its command economy, even following the collapse of the Soviet Union in 1991. As the Cold War ended, North Korea lost the support of the Soviet Union and plunged into economic crisis. In 1998, South Korean President Kim Dae-jung initiated the Sunshine Policy, which aimed to foster better relations with the North. The main aim of the policy was to soften North Korea’s attitudes towards the South by encouraging interaction and economic assistance. The national security policy had three basic principles: no armed provocation by the North will be tolerated, the South will not attempt to absorb the North in any way, and the South actively seeks cooperation.
Despite a naval clash in 1999, and in 2000, the first Inter-Korean Summit between the leaders of the two countries—Kim Dae-jung and Kim Jong-il—took place. As a result, Kim Dae-jung was awarded the Nobel Peace Prize. The summit was followed by the reunion of families divided by the Korean War. The same year, the North and South Korean teams marched together at the Sydney Olympics. Trade increased to the point where South Korea became North Korea’s largest trading partner. In 2003, the Kaesong Industrial Region was established to allow South Korean businesses to invest in the North. However, in the aftermath of the September 11 attacks, U.S. President George W. Bush did not support the policy and in 2002 branded North Korea as a member of “the Axis of Evil.” The Sunshine Policy was formally abandoned by South Korean President Lee Myung-bak after his election in 2007.
Meanwhile, in response to its increased isolation, North Korea redoubled its efforts to develop nuclear weapons and intercontinental ballistic missiles. In 2006, North Korea announced it had successfully conducted its first nuclear test. At the start of the 21st century, it was estimated that the concentration of firepower in the area between Pyongyang and Seoul was greater than that in Central Europe during the Cold War. The North’s Korean People’s Army was numerically twice the size of South Korea’s military and had the capacity to devastate Seoul with artillery and missile bombardment. South Korea’s military, however, was assessed as technically superior. US forces remained in South Korea and carried out annual military exercises with South Korean forces. These have been routinely denounced by North Korea as acts of aggression. Between 1997 and 2016, the North Korea government accused other governments of declaring war against it 200 times. In 2013, amid tensions about its missile program, North Korea temporarily forced the shutdown of the jointly operated Kaesong Industrial Region The zone was shut again in 2016. In 2016, amid controversy, South Korea decided to deploy the U.S. THAAD anti-missile system. After North Korea’s fifth nuclear test in September 2016, it was reported that South Korea had developed a plan to raze Pyongyang if there were signs of an impending nuclear attack from the North.
Over this period, North Korea remained under the control of a communist, military dictatorship. North Korea’s first military dictator, Kim Il-sung died from a sudden heart attack in 1994. His son, Kim Jong-il, who had already assumed key positions in the government, succeeded as General-Secretary of the Korean Workers’ Party. At that time, North Korea had no secretary-general in the party nor a president. Although a new constitution appeared to end the war-time political system, it did not completely terminate the transitional military rule. Rather, it legitimized and institutionalized military rule by making the National Defense Commission (NDC) the most important state organization and its chairman the highest authority. After three years of consolidating his power, Kim Jong-il became Chairman of the NDC in 1997 and thus North Korea’s de facto head of state.
Meanwhile, the economy was in steep decline. From 1990 to 1995, foreign trade was cut in half, with the loss of subsidized Soviet oil particularly keenly felt. The crisis came to a head in 1995 with widespread flooding that destroyed crops and infrastructure, leading to a famine that lasted until 1998.The North Korean government and its centrally planned system proved too inflexible to effectively curtail the disaster. Estimates of the death toll vary widely. Out of a total population of approximately 22 million, somewhere between 240,000 and 3.5 million North Koreans died from starvation or hunger-related illnesses, with deaths peaking in 1997. Recent research suggests that the likely number of excess deaths between 1993 and 2000 was about 330,000.
Kim Jong-un's Rule
In 2011, the supreme leader of North Korea Kim Jong-il died from a heart attack. His youngest son Kim Jong-un was announced as his successor. In December 2011, the leading North Korean newspaper Rodong Sinmun announced that Kim Jong-un had been acting as chairman of the Central Military Commission and supreme leader of the country. In 2012, a large rally was held by Korean People’s Army in front of Kumsusan Memorial Palace to honor Kim Jong-un and demonstrate loyalty. North Korea’s cult of personality around Kim Jong-un was stepped up following his father’s death. In February 2017, two women in Malaysia with VX nerve agent (a chemical weapon) attacked and killed Kim Jong-nam, during his return trip to Macau at the Kuala Lumpur International Airport. Kim Jong-nam was the eldest son of Kim Jong-il and half-brother of Kim Jong-un; from 1994 to 2001 Kim Jong-nam was considered the heir apparent to his father, prior to his exile to Macau. Kim Myung-yeon, a spokesperson for South Korea’s ruling party, described the killing as a “naked example of Kim Jong-un’s reign of terror.” The South Korean government accused the North Korean government of being responsible for Kim Jong-nam’s assassination and drew a parallel with the execution of Kim Jong-un’s own uncle and others. The government later held an emergency security council meeting where they condemned the murder of Kim Jong-nam. The acting President of South Korea, Hwang Kyo-ahn said that if the murder of Kim Jong-nam was confirmed to be masterminded by North Korea, it would clearly depict the brutality and inhumanity of the Kim Jong-un regime.
Under Kim Jong-un, North Korea has continued to develop nuclear weapons. In 2013, Kim Jong-un announced that North Korea will adopt “a new strategic line on carrying out economic construction and building nuclear armed forces simultaneously.” According to several analysts, North Korea sees the nuclear arsenal as vital to deter an attack, but it is unlikely that the country would launch a nuclear war. In 2016, Kim Jong-un stated that North Korea would “not use nuclear weapons first unless aggressive hostile forces use nuclear weapons to invade on our sovereignty.” However, on other occasions, North Korea has threatened “preemptive” nuclear attacks against a U.S.-led attack. As of 2016, the United Nations has enacted five cumulative rounds of sanctions against North Korea for its nuclear program and missile tests.
Human rights violations under the leadership of Kim Jong-il were condemned by the UN General Assembly. Press reports indicate that they are continuing under Kim Jong-un. The 2013 report on the situation of human rights in North Korea by United Nations Special Rapporteur Marzuki Darusman proposed a United Nations commission of inquiry to document the accountability of Kim Jong-un and other individuals in the North Korean government for alleged crimes against humanity. The report of the commission of inquiry was published in 2014 and recommends making him accountable for crimes against humanity at the International Criminal Court.
A 2013 study reported that communicable diseases and malnutrition are responsible for 29% of the total deaths in North Korea. This figure is higher than that of high-income countries and South Korea, but half of the average 57% of all deaths in other low-income countries. Infectious diseases like tuberculosis, malaria, and hepatitis B are considered endemic as a result of the North Korean famine (1994 – 1998). The famine had a significant impact on the population growth rate, which declined to 0.9% annually in 2002 and 0.53% in 2014. In 2006, the World Food Program (WFP) and the Food and Agriculture Organization estimated a requirement of 5.3 to 6.5 million tons of grain in aid when domestic production fulfilled only 3.8 million tons. The country also faces land degradation after forests stripped for agriculture resulted in soil erosion. In 2008, a decade after the worst years of the famine, total production was 3.3 million tons (grain equivalent) compared with a need of 6 million tons. 37 percent of the population was deemed to be insecure in food access. Weather continued to pose challenges every year, but overall food production has grown gradually. In 2014, North Korea had an exceptionally good harvest, 5.08 million tons of cereal equivalent, almost sufficient to feed the entire population. While food production has recovered significantly since the hardest years of 1996 and 1997, the recovery is fragile, subject to adverse weather and year-to-year economic shortages. North Korea’s GDP per capita has been less than $2,000 in the late 1990s and early 21st century.
According to a 2012 NASA photograph from outerspace, North Korea is lacking in infrastructure, most certainly available electricity. The night-time photograph revealed that while South Korea was lit up from electricity, North Korea was almost entirely dark.
According to a 2014 BBC World Service Poll, 3% of South Koreans view North Korea’s influence positively, with 91% expressing a negative view, making South Korea, after Japan, the country with the most negative feelings about North Korea in the world. However, a 2014 South Korean government funded survey found only 13% of South Koreans viewed North Korea as hostile and 58% of South Koreans believed North Korea was a country they should cooperate with.
Attributions
Title Image
Skylines of Singapore's Central Business District at night - Basile Morin, CC BY-SA 4.0 <https://creativecommons.org/licenses/by-sa/4.0>, via Wikimedia Commons
Adapted From:
https://courses.lumenlearning.com/boundless-worldhistory/chapter/japanese-recovery/
https://creativecommons.org/licenses/by-sa/4.0/
https://courses.lumenlearning.com/boundless-worldhistory/chapter/the-koreas/
https://creativecommons.org/licenses/by-sa/4.0/
https://courses.lumenlearning.com/boundless-worldhistory/chapter/the-indian-subcontinent/
https://creativecommons.org/licenses/by-sa/4.0/
https://courses.lumenlearning.com/boundless-worldhistory/chapter/east-asia-in-the-21st-century/
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oercommons
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2025-03-18T00:36:47.397471
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Neil Greenwood
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{
"license": "Creative Commons - Attribution - https://creativecommons.org/licenses/by/4.0/",
"url": "https://oercommons.org/courseware/lesson/88099/overview",
"title": "Statewide Dual Credit World History, The Catastrophe of the Modern Era: 1919-Present CE, Chapter 16: Globalization, Tiger Economies",
"author": "Anna McCollum"
}
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https://oercommons.org/courseware/lesson/87536/overview
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GenderMag Project
GenderMag Twitter
GenderMag YouTube
Cognitive Styles when Using Technology
Overview
What cognitive styles do we use to interact with technology? The GenderMag Project has identified five cognitive facets we bring to our use of technology.
Overview
The GenderMag Project has identified five research-based cognitive facets people bring to their use of technology:
- Motivations for using technology,
- Self-efficacy when using technology,
- Learning style when using technology,
- Information processing style when using technology, and
- Attitude toward risk when using technology.
Keep reading to learn more about each facet and the GenderMag personas that embody different sets of facet values (also called cognitive styles).
GenderMag Personas
The GenderMag Project has defined three GenderMag personas: Abi, Pat, and Tim. Each persona represents a different set of cognitive styles. Abi and Tim represent the two ends of the cognitive style spectra and Pat is in the middle.
See the Attached Resources (below) for definitions of each GenderMag facet and each facet value.
Abi, Pat, and Tim:
Abi
(Abigail/Abishek)
(Abigail/Abishek)
Motivation: Uses technology to accomplish their tasks.
Computer Self-Efficacy: Lower self-confidence than peers about doing unfamiliar computing tasks. Blames themselves for problems, which affects whether and how they will persevere.
Attitude Toward Risk: Risk-averse about using unfamiliar technologies that might require a lot of time.
Information Processing Style: Comprehensive.
Learning by Process vs. Tinkering: Process-orientated learning.
Pat
(Patricia/Patrick)
(Patricia/Patrick)
Motivation: Learns new technologies when they need to.
Computer Self-Efficacy: Medium confidence doing unfamiliar computing tasks. If a problem can't be fixed, they will keep trying.
Attitude Toward Risk: Risk-averse and doesn't want to expend time when they might not receive benefits.
Information Processing Style: Comprehensive.
Learning by Process vs. Tinkering: Likes to explore and purposefully tinker.
Tim (Timara/Timothy)
Motivation: Likes learning all the available functionality on all their devices
Computer Self-Efficacy: High confidence in technical abilities. If a problem can't be fixed, blame goes to software vendor.
Attitude Toward Risk: Doesn't mind taking risk using features of technology.
Information Processing Style: Selective information processing
Learning by Process vs. Tinkering: Likes tinkering and exploring.
Learn More
Want to learn more? Additional resources below.
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oercommons
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2025-03-18T00:36:47.429908
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Psychology
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{
"license": "Creative Commons - Attribution - https://creativecommons.org/licenses/by/4.0/",
"url": "https://oercommons.org/courseware/lesson/87536/overview",
"title": "Cognitive Styles when Using Technology",
"author": "Information Science"
}
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https://oercommons.org/courseware/lesson/95301/overview
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simple cuboidal epi_surface of ovary_400x, p000128
Overview
| simple cuboidal epi_surface of ovary_400x |
simple cuboidal epi_surface of ovary_400x
simple cuboidal epi_surface of ovary_400x,
| one layer surface cells top layer is square looking with round nucleus |
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oercommons
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2025-03-18T00:36:47.443213
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Diagram/Illustration
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{
"license": "Creative Commons - Attribution - https://creativecommons.org/licenses/by/4.0/",
"url": "https://oercommons.org/courseware/lesson/95301/overview",
"title": "simple cuboidal epi_surface of ovary_400x, p000128",
"author": "Health, Medicine and Nursing"
}
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https://oercommons.org/courseware/lesson/89755/overview
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Andrew Carnegie, “The Gospel of Wealth,” 1889 (Excerpts)
Overview
Carnegie, Andrew. "The Gospel of Wealth" Carnegie Corporation of New York. 2017,
p.11-14, https://media.carnegie.org/filer_public/0a/e1/0ae166c5-
fca3-4adf-82a7-74c0534cd8de/gospel_of_wealth_2017.pdf
Description: A millionaire industrialist addresses his philosophy of philanthropy
Carnegie, Andrew. "The Gospel of Wealth" Carnegie Corporation of New York. 2017,
p.11-14, https://media.carnegie.org/filer_public/0a/e1/0ae166c5-
fca3-4adf-82a7-74c0534cd8de/gospel_of_wealth_2017.pdf
Description: A millionaire industrialist addresses his philosophy of philanthropy
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oercommons
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2025-03-18T00:36:47.461874
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Christopher Gilliland
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{
"license": "Creative Commons - Attribution - https://creativecommons.org/licenses/by/4.0/",
"url": "https://oercommons.org/courseware/lesson/89755/overview",
"title": "Andrew Carnegie, “The Gospel of Wealth,” 1889 (Excerpts)",
"author": "Susan Jennings"
}
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https://oercommons.org/courseware/lesson/92703/overview
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ASTR 1020 - Lab 9: Cepheids - Part B
Overview
In Part B, we will use a Python computer coding script to obtain a spectral redshift of a galaxy (M100). From this redshift, we will use the Doppler formula to find a recession speed. From this speed, we will apply Hubble’s Law to obtain the Hubble Constant.
---------------------------------------
Distant Nature: Astronomy Exercises 2016 by Stephen Tuttle under license "Creative Commons Attribution Non-Commercial Share Alike".
ASTR 1020 - Lab 9: Cepheids - Part B
Download the attached zip file and install the zipped file (it contains a website) on a server or in your LMS course section.
To place HTML (website) content in D2L's Brightspace:
- Create an appropriate folder structure in Manage Files. This location is where files will be uploaded and unzipped. Each resource (website) should have a descriptively named independent folder.
- Navigate to the appropriate folder and Upload the zip file.
- Unzip the folder by clicking the pull-down arrow, and clicking Unzip on the submenu. A content folder will appear. It contains two folders and two HTML files.
- Associate the index.html file to your Course Content topic. Perform this task in the Course Content area by clicking New and then clicking Add from Manage Files on the submenu. Next, navigate to the index.html file and Add the file.
- Click the pull-down arrow by the new web page topic (currently named index). Next, click Edit Properties In-place on the submenu and rename the link to be descriptive.
- Delete the extraneous zip file from the Manage Files folder.
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oercommons
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2025-03-18T00:36:47.480076
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05/13/2022
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{
"license": "Creative Commons - Attribution - https://creativecommons.org/licenses/by/4.0/",
"url": "https://oercommons.org/courseware/lesson/92703/overview",
"title": "ASTR 1020 - Lab 9: Cepheids - Part B",
"author": "Hollyanna White"
}
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https://oercommons.org/courseware/lesson/86158/overview
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video_20210823_002327_edit
Air pollution
Overview
This animated video consist of information about air pollution , its sources, its impact and control measures
Air pollution, sources, impact, control measures
Air pollution, sources, impact, control measures
|
oercommons
|
2025-03-18T00:36:47.498591
|
09/26/2021
|
{
"license": "Creative Commons - Attribution - https://creativecommons.org/licenses/by/4.0/",
"url": "https://oercommons.org/courseware/lesson/86158/overview",
"title": "Air pollution",
"author": "Mariyum Ansari"
}
|
https://oercommons.org/courseware/lesson/91048/overview
|
Higher Education Syllabus Sharing. Schimizzi
Overview
Schimizzi 101
Why Schimizzi's Bio 101 Class has an Open Syllabus?
Rationale for openly sharing this syllabus
(Use this space to provide a short background on why there is value in openly sharing your syllabus.)
Aspects of this syllabus that may want specific attention for remixing
(Use this space to orient the professor to which sections of the syllabus might want need special attention for remixing based on student populations. Example - "This course features a high number of adults in a second career and they may not have expertise in __________________. This course features supports to help them slowly build their confidence with ____________.")
Opportunities for collaboration
(Use this space to identify specific parts of your course that you see as in the "continuous improvement" phase. This may be a section where you would appreciate seeing remixes so that you can grow from additional thought partnering. Example "This course is currently using peer feedback on the essay portion of assessment #2. The included peer rubric that is linked seems to have challenges with peers giving thorough feedback. Additional thoughts about including authentic peer feedback would be appreciated.)
Syllabus Content
(Copy and paste your syllabus into this space. You can also "Import from Google Docs" and attach Word Documents or PDFs.)
|
oercommons
|
2025-03-18T00:36:47.512931
|
03/18/2022
|
{
"license": "Creative Commons - Attribution - https://creativecommons.org/licenses/by/4.0/",
"url": "https://oercommons.org/courseware/lesson/91048/overview",
"title": "Higher Education Syllabus Sharing. Schimizzi",
"author": "Joanna Schimizzi"
}
|
https://oercommons.org/courseware/lesson/99505/overview
|
Life…will it prevail? Or will we end it all?
Overview
How can we show the ways our society prioritizes environmental issues? Life on Land, Life below water, Clean Water and Sanitation, and Climate Action .... Do surrounding communities prioritize the solving of environmental issues differently? How do communities unite individuals to be part of the solution to these environmental problems?
SDG 6,13,14,15
https://docs.google.com/presentation/d/166oo8x0exEU0VZUmIjY1pfm_QUlw_9y-aK9mD0l6YAg/edit?usp=sharing
|
oercommons
|
2025-03-18T00:36:47.530339
|
12/17/2022
|
{
"license": "Creative Commons - Attribution - https://creativecommons.org/licenses/by/4.0/",
"url": "https://oercommons.org/courseware/lesson/99505/overview",
"title": "Life…will it prevail? Or will we end it all?",
"author": "ying lin"
}
|
https://oercommons.org/courseware/lesson/62863/overview
|
Fundamentals of Physical Geography (2nd Edition)
Overview
This resource is used for GEOG 120: Physical Geography Earth Systems
http://www.physicalgeography.net/about.html
GEOG 120
This resource is used for GEOG 120.
This resource is used for GEOG 120: Physical Geography Earth Systems
http://www.physicalgeography.net/about.html
This resource is used for GEOG 120.
|
oercommons
|
2025-03-18T00:36:47.546275
|
02/20/2020
|
{
"license": "Creative Commons - Attribution - https://creativecommons.org/licenses/by/4.0/",
"url": "https://oercommons.org/courseware/lesson/62863/overview",
"title": "Fundamentals of Physical Geography (2nd Edition)",
"author": "Barbara Illowsky"
}
|
https://oercommons.org/courseware/lesson/60267/overview
|
Economics of Opioids Video
Glossary and pre/post quiz
How Naloxone Works
NAS Video
Structure and Function Video
Opioid Use and Abuse
Overview
A jigsaw activity where students watch one of five short videos on different aspects on opioid use and abuse.
This resource contains a 50 minute activity to explore some of the science underlying the ongoing opioid epidemic in the US. It asks students to watch one of 5 short videos, then assemble in a "jigsaw" group to discuss some general questions about opioid use and abuse. The activity is appropriate for first year undergraduate students from all majors.
Overview of Activity
Setting up this activity requires access to at least five different internet accessible devices, be they laptops, tablets, iPads, etc. Students will need to listen to their video's audio as well, so the different sections will either need to be physically spaced in such a way that each group can only hear their own video, or give students headphones and ensure that the device can accommodate the number of students in each group. Use of the closed captioning feature is highly recommended to help students process the new information coming in. Each student should also have access to the glossary while watching their videos. Topic groups should be of approximately equal size.
The activity has three phases:
1) Working in topic groups to aquire knowledge,
2) Sharing that knowledge in jigsaw groups to share and apply the knowledge, and
3) Reporting out to the entire class.
Each activity is about 10 minutes. With time to switch between activities, the entire lesson fits nicely into a 50 minute class period. No prior knowledge is required - the videos are geared at first-year college students from any major.
The materials in this activity were developed by students from Westfield State University. The image shown above is a still from the video featured in Section 6 (artwork by Chinanu Onuoha). The attached handout has a glossary on one side and some multiple-choice questions on the back side.
Focus on: Receptor Structure and Function
This topic tends to be the most dense in terms of scientific content. If students are struggling with understanding this video, shift the focus of their discussion away from the molecular minutia and towards more broad questions, along the line of "What does the opioid receptor do for the body?" as opposed to "How does it work?".
The brain's opioid receptor is naturally occuring and is abused by opioid drugs to get a "high".
This is an in-class activity. You will first learn something in a small group, and then you will share your insight in a new group where each member is responsible for a distinct topic relating to the opioid crisis.
Watch the 4-minute video and and take 5 minutes to discuss the following questions:
How does the opioid receptor help us to survive? What is the benefit of having the receptor? What are the dangers associated with the opioid receptor?
Focus on: Abuse of Prescription Drugs
Prescrition opioid deaths in the United States are rising.
This is an in-class activity. You will first learn something in a small group, and then you will share your insight in a new group where each member is responsible for a distinct topic relating to the opioid crisis.
Watch this 4-minute video and and take 5 minutes to discuss the following questions:
What are abuse-deterrent formulations (ADF) of drugs, and how are these drugs abused nevertheless? Should pharmaceutical producers be held liable for the abuse of their drugs, given their misleading marketing? Should the FDA have allowed the ADF opioids to enter the market if the ADF was so easy to circumvent?
Focus on: Neonatal Abstinence Syndrome
Newborn babies experience withdrawal after a couple of days.
Watch the 4-minute video and and take 5 minutes to discuss the following questions:
Why are more and more babies experiencing opioid withdrawal a couple days after birth? What are the possible treatments? Is it correct to say that the newborns are born with an addiction?
Focus on: Restoring Respiration After Overdose
Narcan is a fast acting opioid antagonist.
This is an in-class activity. You will first learn something in a small group, and then you will share your insight in a new group where each member is responsible for a distinct topic relating to the opioid crisis.
Watch this 3-minute video and and take 6 minutes to discuss the following questions:
Why do we use an opioid (Naloxone) to help treat opioid overdose? Some places in America have proposed "3-Strike" policies where, after emergency response has administered naloxone to the same person twice, on the third overdose, the addict will not be allowed to recieve another dose. Is this an appropriate policy to have in place? Should Naloxone be available as an over-the-counter medication, or should it only be able to be administered by EMTs/with a prescription?
Focus on: Price of Opioids
Price and availability on the legal and the black market drives decisions about drug intake.
Watch the 4-minute video and and take 5 minutes to discuss the following questions:
How did Jeremy become dependent on opioids? Why did Jeremy switch from Percocet to heroin? Is there a way to limit crowding out, while maintaining regulations that keep legal opioids safe to use?
Jigsaw Discussions
After watching your assigned video and discussing it within a group, we will form new (jigsaw) groups of five, where each person in the group has watched and discussed a different video. This way, each jigsaw group combines the experience of watching all five videos.
In your jigsaw group, give a brief overview of the video you saw (2 minutes). Then as a group, discuss the following question and write down your conclusion.
Who is to blame for the opioid epidemic? Should we think of addiction as failure of will power of individuals, or as a treatable disease? What are the steps necessary to stop the epidemic and help the people who have a substance abuse disorder?
Be prepared to present your conclusions.
Reporting Out
Each jigsaw group should select a speaker who will summarize the discussion in front of the entire class. First, state which question you found most interesting. Then, tell us your conclusions. We will take about 10 minutes for reporting out.
|
oercommons
|
2025-03-18T00:36:47.577110
|
Holden Nelson
|
{
"license": "Creative Commons - Attribution - https://creativecommons.org/licenses/by/4.0/",
"url": "https://oercommons.org/courseware/lesson/60267/overview",
"title": "Opioid Use and Abuse",
"author": "Karsten Theis"
}
|
https://oercommons.org/courseware/lesson/61931/overview
|
Organizing Research: The Why and the How
Overview
A worksheet and short presentation in PDF format designed to introduce students to different strategies for oganizing research.
Worksheet
Organizing Research: The Why and the How
The Why: What are some reasons you might want to invest time in organizing your research? Have you had any experiences doing research for a paper or project where organization helped or would have helped?
The How: There is no one “right” system for organizing your research! We’ve presented a few today, but you should find what works best for you. Here are the strategies we talked about:
Strategy 1: The Word Document
- For each source you find, export a citation into a Word document.
- Read your source and make notes as you go. Are there:
- Quotes that you might use or that back up something you're saying in your paper?
- Definitions or statistics that might be helpful?
- Something similar to or different than what you've read somewhere else?
- Make a note under your citation. Including page numbers and exact quotes can be helpful
Strategy 2: The Index Card
- Print out your source (article, web site, etc.).
- Highlight and take notes on the source.
- Read the source and take notes on it.
- highlight, take notes in the margins, etc.
- Use an index card. On one side:
- write down the citation for the article (or at least the title and author).
- On the other side:
- write down any quotes, definitions or statistics, information you think will be useful in your paper
Strategy 3: The Citation Management System
There are many citation management systems you can use for free online. Zotero (www.zotero.org) and Mendeley (www.mendeley.com) are two examples. Citation Management Systems let you track the sources you use, take notes on your sources, and (often) export a Works Cited page.
| What strategy (can be one that was mentioned, or something else) will work for you? Why? |
This work, by Emily Campbell, is licensed under a CC BY 4.0 license.
Canva Presentation
See attachment
|
oercommons
|
2025-03-18T00:36:47.600327
|
01/26/2020
|
{
"license": "Creative Commons - Attribution - https://creativecommons.org/licenses/by/4.0/",
"url": "https://oercommons.org/courseware/lesson/61931/overview",
"title": "Organizing Research: The Why and the How",
"author": "Emily Campbell"
}
|
https://oercommons.org/courseware/lesson/93363/overview
|
Nonverbal Communication Observation
Overview
The Nonverbal Communication Observation allows students to apply knowledge about nonverbal communication in the real world by observing others in public while interpreting nonverbal messages.
Nonverbal Channels Observation
Observe a public situation in which a number of people interact, such as the grocery store, Target, Lowes, Walmart, or a restaurant.
Briefly describe the situation you observed.
Next, answer the following questions about the nonverbal communication normally used in this setting.
- How much distance do people keep between themselves and others?
- Does this distance vary as the situation changes? For example, what happens when it becomes more or less crowded?
- Does the distance vary among different people with different relationships?
- What kinds of behaviors occur if the normal distances are violated?
- Explain the use of markers in this setting.
- What kind of eye communication is used in this setting?
- Is there any use of haptics in this setting? Explain how.
|
oercommons
|
2025-03-18T00:36:47.616133
|
Homework/Assignment
|
{
"license": "Creative Commons - Attribution - https://creativecommons.org/licenses/by/4.0/",
"url": "https://oercommons.org/courseware/lesson/93363/overview",
"title": "Nonverbal Communication Observation",
"author": "Assessment"
}
|
https://oercommons.org/courseware/lesson/82920/overview
|
Tables and Figures from Chemistry 2e?
Overview
OpenStax
Figures
How can I obtain this table for import? Powerpoint won't let me import a PDF. I don't want to import a screenshot, but I might just do this.
Appendix K (Formation Constants For Complex Ions) Wanted for Display in PowerPoint
|
oercommons
|
2025-03-18T00:36:47.627844
|
06/29/2021
|
{
"license": "Creative Commons - Attribution - https://creativecommons.org/licenses/by/4.0/",
"url": "https://oercommons.org/courseware/lesson/82920/overview",
"title": "Tables and Figures from Chemistry 2e?",
"author": "MARK WANAMAKER"
}
|
https://oercommons.org/courseware/lesson/77657/overview
| ERROR: type should be string, got "https://covenanthealthcare.com/Uploads/Public/Documents/Workfiles/Foundation/2017_Confidentiality_Training.pdf\nhttps://www.oercommons.org/courseware/lesson/15344/overview\nhttps://www.uncmedicalcenter.org/app/files/public/f06a4b2d-f855-4db7-9409-4dee81a6d675/MedCtr-Volunteer-Services-Tests-Communicating-Patients-Caregivers.pdf\nhttps://www.youtube.com/watch?v=8XZUOEJhYcs\nInfographic\npodcast: Volunteers in Hospice\nVolunteer Position Description\nVolunteer Hospice Training\nOverview\nThe Role of the Volunteer in Hospice Care.\nThe importance of volunteers to the program cannot be overstated. Without volunteers, we could not provide the kinds nor the scope of services that are so urgently needed to enhance the quality of lives of our patients and their families. In this service, volunteers will learn about the specific functions and responsibilities expected of the volunteer, including the importance of working as a member of the multidisciplinary team working with both the patient and the family.\nOrientation to the Volunteer Role in Hospice\nReview what is hospice.\nDiscuss historical evolution and philospy\nReview the video and ask for thoughts.\nReview infographic\nTo Begin your training as a hospice volunteer with Alliant Home Health, a company that provides medical care to patients in their homes throughout the Denver Metro Area, we will discuss the fundamentals of hospice.\nAlliant Home Health provides a variety of health care services in the comfort of the patient's home. Alliant Home Health is dedicated to providing you exceptional medical care allowing you to live longer and safer at home.\nCore Services include:\n- Skilled Nursing\n- Physical Therapy\n- Occupational Therapy\n- Speech Therapy\n- Certified Nursing Assistant\n- Medical Social Services\n- Hospice\nAlliant Home Health is proud to serve communities across the front range with offices in Lakewood and Fort Collins. We are different from other home health agencies in many ways:\n- Our owners have over 45 years of combined health care experience in Colorado\n- We are family owned\n- We are clinician owned\n- We are veteran owned\n- As a local company, we are able to adapt to the needs of the communities we serve\nWhat is Hospice?\nWhile we all have heard of hospice, not many of us have a thorough understanding of how it is implemented to serve those in their last months of life.\n“You matter because of who you are. You matter to the last moment of your life, and we will do all we can, not only to help you die peacefully but also to live until you die.”\n--Dame Cicely Saunders, founder of the first modern hospice\nWhat is Hospice?\nHospice recognizes death as a universal fact of life. Hospice provides support and care for patients in their last phases of a life-limiting illness. Recognizing that dying is a natural part of life, the focus of hospice is on the individual and the involved family rather than on the disease. Hospice is life-affirming and neither hastens or postpones death. Hospice serves the whole person, emotionally, physically, and spiritually. Through supportive, palliative care, and open communication, the patient and family learn to more fully appreciate the activities of daily living. In the last few months of life, to a goal of hospice is to assist with the development of a caring community that can provide comprehensive services to patients and families.\nCare focuses on quality of life, maintaining dignity, and a sense of personal fulfillment to the dying by allowing choices, listening, and caring. To qualify for hospice, a patient must have a life-limiting illness, with a prognosis of 6 months or less if the disease takes its normal course. The patient must consent to accept services, and forgo other medical treatments for the terminal illness.\nVolunteers serve as a part of an interdisciplinary team to care for patients who have entered Hospice Care. These teams include Physicians, Nurses, CNAs, Social Workers, Chaplains, and Volunteers. The volunteers’ role on the team is not optional. Volunteers are considered a vital component of the service. In fact, it is required that 5% of care is provided by a volunteer.\nWhat Kind of Care is Included in Hospice?\n- symptom control and management, also known as palliative care\n- pain management\n- stress management and mental health support\n- spiritual support\n- family support\nSymptom management does not involve treatment of the illness directly, such as the use of chemotherapy to treat cancer. Instead, hospice care helps ease symptoms to ensure the person can live comfortably in their final days.\nHospice caregivers also provide support to the families. Hospice Teams provide 24/7 support.\nObjectives of Hospice:\n- To provide palliative and supportive care services on an inpatient and outpatient basis to the terminally ill patient and family.\n- To promote physical, psychological, social, and spiritual wellbeing for the terminally ill and their families through the integration of all physician and ancillary services.\n- To encourage the patient to be actively involved in decision-making regarding care.\n- To provide the terminally ill and their families with care to allow the patient to remain at home as long as possible up to and including death if that is the patient's desire.\n- To maintain patients as pain-free and alert as possible under the continuing supervision of their personal physician.\n- To provide, on an inpatient basis, temporary or intermittent care to control symptoms or modify treatment and provide short-term care to relieve the family.\n- To reduce the cost of dying for the terminally ill and family.\n- To continue to support the family after the patient's death through visits, phone contacts, mailings and through community bereavement groups.\n- To provide service, support, and education for physicians, staff, volunteers, laypeople and clergy who care for the terminally ill.\nVolunteering in Hospice\nWelcome to your journey to becoming a Hospice Volunteer. Hospice Volunteers are caring, committed, reliable emotionally mature. Supporting someone through the dying process is likely to heighten you own values and help you to focus on what matters most in life.\nSome questions to ask yourself might be:\n- Are you comfortable with the concept of death and dying?\n- Are you okay being alone with someone who is dying?\n- Can you manage the suffering, tears, emotions, and stress of the patients and families without making them your own?\n- Can you set aside you own opinions to support the patient and family?\n- Are you a good team player and able to follow protocol?\n- Can you handle a patient or family being rude or displaying inappropriate behavior?\n- Can you make a weekly 4 hour commitment and be reliable?\nIn this role as a volunteer, you will\n- Serve others\n- Develop your ability to relate well to others, and learn other new skilss\n- Grow personally\n- Give back to your community\n- Meet new people\n- Have a direct, personal impact in the world\n- Participate as a team\nFor the position description of the role of the volunteer and required training, please see the attached document.\nAs a volunteer for Alliant Home Hospice, you will work as part of an interdisciplinary team. Members of the team include physician, nurse, social worker, chaplain, volunteer, therapist, dietician. As a member of the team, it is critical that you communicate often. Because volunteers are so important to the team, it is mandated that 5% of the service provided to the patient and family must be performed by a volunteer. Of all of the team members, the volunteer is considered the most important in terms of all-around benefit to the patient. You will have the opportunity to provide physical, emotional, and spiritual support and save money for your hospice by providing care on a volunteer basis.\nSome of the services that are offered by our agency include:\n- 24 hours consultation with nursing staff, as needed,\n- state of the art pain and symptom management\n- emotional support and counseling\n- spiritual support\n- bereavement support\n- medications needed for pain and symptom management\n- equipment needed for comfort\n- assistance with physical care\n- therapies as needed\n- volunteers as support.\nWhen a person decides to become a Hospice patient, this individual and the family are asked if they would like volunteer services. Some do and some don't. The Volunteer Coordinator will be attending interdisciplinary team meetings and to determine which hospice families would like a volunteer and what their needs may be. For members of the team and their roles, please see the attached Interdisciplinary Team Members and their roles.\nBefore you are assigned a position, you will be provided with a description of the patient and family's situation. You are not required to accept a position. In fact, we want to make sure that the match is a good one for everyone involved. Because we were the entire Denver Metro area, we will ensure to find you a position within a 30 minutes drive from your home.\nThe Role of the Volunteer\nWhat will I be doing?\nConfidentiality\nGive the confidentiality powerpoint. Ask the following questions:\nWhat are some ways to avoiding seeing/hearing confidential information?\nWhat are topics to avoid?\nMaintaining Confidentiality is of upmost importance. In fact it is the law. https://silo.tips/download/hipaa-training-for-hospice-staff-and-volunteers\nCommunication Skills\nxxx" |
oercommons
|
2025-03-18T00:36:47.667896
|
Peter O'Dwyer
|
{
"license": "Creative Commons - Attribution - https://creativecommons.org/licenses/by/4.0/",
"url": "https://oercommons.org/courseware/lesson/77657/overview",
"title": "Volunteer Hospice Training",
"author": "Sally O'Dwyer"
}
|
https://oercommons.org/courseware/lesson/56663/overview
|
Unit 5.2 Cell Plasma Membrane components
Overview
A 13 minute video lecture on the structural components of plasma membrane.
Chapter 5 Plasma Membrane structural components
Video lecture to accompany Openstax Biology 2e Chapter 5 "Structure and Function of Plasma Membrane" (13 minutes)
|
oercommons
|
2025-03-18T00:36:47.681196
|
08/05/2019
|
{
"license": "Creative Commons - Attribution - https://creativecommons.org/licenses/by/4.0/",
"url": "https://oercommons.org/courseware/lesson/56663/overview",
"title": "Unit 5.2 Cell Plasma Membrane components",
"author": "Urbi Ghosh"
}
|
https://oercommons.org/courseware/lesson/66209/overview
|
Role of Nutrition and Major Nutrients for Human beings
Overview
Burtis, C.A., and E.R Ashwood, eds. Tietz Textbook of Clinical Chemistry,
2nd ed. Philadelphia:W. B. Saunders Co., 1994
Role of Nutrition and Major Nutrients for Human Beings
Abstract: Major nutrients, which are carbohydrates, proteins, and lipids (fats), are used as energy sources or as building blocks for larger biochemical compounds. Minor nutrients, which include all vitamins and minerals, assist the chemical reactions that occur with major nutrients. A balanced diet includes all of the necessary major and minor nutrients. If the diet is not balanced, some energy sources or building blocks will be missing and the body will not function properly.Nutrients serve as building blocks for larger chemicals and the energy that fuels all of the body’s processes, from cellular repair to the use of the muscles.
Keywords: Nutrients, carbohydrates, proteins and lipids(Fats), ATP , cholesterol
Introduction
People need to eat because they need energy. Food provides that energy. The body needs energy to make and break chemical bonds that exist in complex biochemical compounds, to hold these compounds together, and to change them. The digestive system and its accessory organs have evolved to supply individuals with the energy they need to work with these chemical bonds. There are three types of chemical bonds. An ionic bond is made between charged atoms where positive and negative charges attract each other. These bonds are fairly strong, but not so strong that energy is needed to alter them. A hydrogen bond is a weak chemical bond that is used to gently hold onto substances during chemical reactions or to fine-tune the structure of strands of proteins so that they can function properly. These bonds also exist between water molecules and anything mixed in water. Hydrogen bonds allow the water molecules to support the compounds that are dissolved in the solution, but are weak enough to allow the compounds to diffuse through the water. Hydrogen bonds are so weak that the chemicals held with them can separate just by drifting off into the surrounding water. The third type of chemical bond, a covalent bond, requires energy to make or break it.
This bond is made when electrons from two or more atoms begin to rotate around all of the atoms, forming a tight bond, almost like a wall around the core of the atoms. Covalent bonds hold biochemical compounds together until the body’s cells force them apart or the bonds wear out from repeated use of the compounds in the body.
Fig(1): ATP is the form of energy that cells use to complete their functions, from replication and division to making proteins and extracting nutrients from food. A molecule of ATP, illustrated here, contains three phosphate groups
Energy that has been extracted from the breakdown of these chemical bonds must be put into a form that cells can use. Cells use a chemical form of energy called adenosine triphosphate (ATP), which is an RNA nucleotide. The three phosphates are attached to the adenosine in series so that the molecule looks like this: A-P~P~P (Figure 1). The phosphates are negatively charged and repel each other. Attaching the second and third phosphate requires energy to force the phosphates onto the molecule. The energy stored in ATP is the energy that holds the repelling phosphates together When the energy is used, the third phosphate is removed, and the energy that was holding the phosphate onto the ATP molecule is usedto make or break a covalent bond. The resulting adenosinediphosphate (ADP) can become ATP by extracting energyfrom a nutrient and using it to attach another phosphate.These energy transport molecules function like rechargeable batteries, with the difference being that the energy is completely discharged each time the ATP is used.
TYPES OF NUTRIENTS
Nutrients are divided into major and minor nutrients. Major nutrients, which are carbohydrates, proteins, and lipids (fats), are used as energy sources or as building blocks for larger biochemical compounds. Minor nutrients, which include all vitamins and minerals, assist the chemical reactions that occur with major nutrients. A balanced diet includes all of the necessary major and minor nutrients. If the diet is not balanced, some energy sources or building blocks will be missing and the body will not function properly.
Carbohydrates
Carbohydrates, a group of molecules that include sugars and starches, provide energy to the body when the molecules are broken down.All carbohydrates contain carbon, hydrogen, and oxygen. They are categorized by size: monosaccharides, disaccharides, and polysaccharides.
Monosaccharides
Monosaccharides, such as glucose, fructose, and galactose, are simple sugars.Usually, the ratio of each of carbon to hydrogen and oxygen is 1:2:1 such that there is one carbon to two hydrogens to one oxygen. Most of the sugars used in the body are six-carbon sugars, so their formula is written as: C6H12O6. The body’s sugar biochemistry is based on the breakdown of glucose. Fructose and galactose feed into the pathway of these chemical reactions.
Disaccharides
Two monosaccharides make a disaccharide. There are three types of disaccharides: sucrose, lactose, and maltose. Each one has glucose as at least one of its sugar units. Sucrose, which is made of glucose and fructose, is common table sugar. Lactose, made of glucose and galactose, is the sugar found in dairy products.Maltose, made of two glucose molecules, is found in anything “malted” and is also the sugar primarily used to make beer. Because disaccharides are too large to pass through the cell membranes, they must be broken down into monosaccharides first.
Polysaccharides
Polysaccharides are several monosaccharides linked in a chain. There are two types of polysaccharides of importance to the body: starches and glycogen. These are made up of only glucose and have slightly different forms, depending on their source and the types of chemical bonds holding them together. Both plants and animals use polysaccharides as a form of short-term energy storage. Starches are the storage carbohydrate form found in plants. There are two types of starch, depending on the complexity of the structure: amylose and amylopectin. Amylose is easily digestible and has a simple structure resembling a bunch of strings made up of glucose molecules linked together in a straight line. Amylopectin has a more complex structure, including a large number of cross-linkages between the strings, and is more difficult for the body to digest. Glycogen is the storage carbohydrate form found in animals. Glycogen is similar to amylopectin, but less complex.
Polysaccharides must be digested to their individual glucose units for the body to be able to use the energy. Monoand disaccharides are found in fruits, sugarcane, sugar beets, honey, molasses, and milk. Starches are found in grains, legumes, and root types of vegetables. Glycogen is present in all animals, although the primary source is beef.
As mentioned earlier, carbohydrates are used for energy. When glucose is broken down, some of the energy released from the chemical bonds is used in ATP molecules. If carbohydrates are not immediately needed, they are converted to glycogen or fat and stored. If not enough glucose is available, the liver breaks down glycogen to release glucose. The liver can convert amino acids into glucose, a process called gluconeogenesis. If sugar is not adequately available in the diet, amino acid supplies will be used to make glucose and not proteins.
Cellulose, another type of polysaccharide, is a major component of wood. It cannot be broken down into smaller units, so it is not digestible. When we ingest cellulose, it is considered roughage or fiber. Although we get no nutritional value from cellulose, it binds cholesterol in the intestine and helps us eliminate this chemical. Fiber also helps to regulate the digestive tract and keep people “regular.”
Proteins
Proteins have many functions in the body. They can be used for energy, structure of different parts of the body, hormones, enzymes, and muscles. Proteins are made of long chains of amino acids, of which there are 20 different types. The structure of proteins starts out simple, and then becomes more complex, depending on the protein. The function of the protein depends on its structure. The chain of amino acids will bend and twist to a three-dimensional form, depending on the sequence of the amino acids. In general, the structure and appearance of proteins can be classified as fibrous or globular.
Fibrous proteins are strand-like in appearance. Fibrous proteins, which are the main building material of the body, are called structural proteins. They include collagen, keratin, and contractile proteins of muscles. Collagen provides strength to the tendons and ligaments that hold bones and muscle together. Keratin is found in skin and “seals” the skin surface, preventing evaporation of water from underlying tissues and keeping invading microorganisms out. Contractile proteins of muscles allow muscles to contract or shorten.
Globular proteins, which are compact, spherical proteins, have a wide variety of functions. Some proteins are found in hormones, such as human growth hormone, which helps regulate growth in the body. Other types of globular proteins are called enzymes and they increase the rate of chemical reactions in the body.
The most complete sources of proteins are found in animal tissues. Plants can also provide amino acids. There are eight amino acids, called essential amino acids, which human beings cannot make. These are tryptophan, methionine, valine, threonine, lysine, leucine, histadine, and isoleucine. Because humans cannot make them, they must be supplied in the diet. If they are not supplied, proteins cannot be made, which results in a protein deficiency. Protein deficiency during childhood can result in developmental problems that restrict both mental and physical development. Deficiencies occurring in adults cause a number of problems, such as premature aging, problems in fighting infections, and bleeding in joints and the digestive tract.
Evaluation of the amount of proteins in the body is used to determine an individual’s nutritional status, called nitrogen balance. If the person is healthy, his production of proteins is equal to the breakdown of proteins, and he is in neutral nitrogen balance. If the person is growing or repairing tissue damage and has adequate amino acid resources for protein production, his production of protein exceeds protein breakdown, and he is in positive nitrogen balance.
If a person’s proteins are being broken down faster than the body can replace them, the person is in negative nitrogen balance, which is not good. Negative nitrogen balance means that the person needs supplementation of proteins and amino acids to achieve a neutral or positive nitrogen balance.
Fats and Lipids
Lipids are insoluble in water, and thus they are difficult to carry in the blood. They are categorized into triglycerides, phospholipids, and steroids. The principal dietary lipids in the body are cholesterol and triglycerides. Phospholipids are mostly tied up in cell membranes and
do not play a significant role in energy metabolism. Triglycerides, which are made in the liver to store excess energy from carbohydrates, make up a major portion of adipose tissue. This tissue provides the body with insulation to keep warm and cushions joints and organs for protection. Triglycerides are composed of three-carbon glycerol molecules with three fatty acids attached, one to each of the three carbons.
Fatty acids are long chains of carbon atoms, 12 to 30 carbons long. Attached to the carbons are hydrogen atoms. If all the possible hydrogen atoms are attached to the chain, the fatty acid is called a saturated fat. If any of the hydrogen atoms are missing, the fatty acid is called an unsaturated fat. These forms of fatty acids behave slightly differently in the body. Saturated fats contribute more to the buildup of plaque in arteries and are considered less healthy than unsaturated fats.Saturated fats are found in all animal tissues, and unsaturated fats are found in nearly all plants. As with proteins, two fatty acids are essential for human beings: linoleic and linolenic, and are called essential fatty acids. About 90% of the body’s dietary fat intake consists of the fatty acids
palmitic acid, stearic acid, oleic acid, and linoleic acid. Linoleic acid is found in vegetable oils, especially corn and safflower oils, and linolenic oil is found in rapeseed oil. Essential fatty acid deficiencies contribute to dermatitis, a depressed immune system, anemia, growth retardation, infertility, and cardiac, liver, and respiratory problems. Steroids are another type of lipid that have hydrocarbon rings. Cholesterol, one of the most important steroids, is made in the liver and ingested with animal tissues. Plants have a counterpart to cholesterol called phytosterol, but this cannot be absorbed by humans and does not contribute to dietary fats. Cholesterol is used as a framework for hormones called steroids. Slight changes are made to the structure of cholesterol to make these hormones. Testosterone and estrogen, which are reproductive hormones, are both steroids. Aldosterone, an adrenal cortex steroid hormone, assists in the renal conservation of sodium. Cholesterol is also incorporated into cell membranes to make them pliable. It is found in the membranes of red blood cells to allow them to enter small capillaries.
Some Facts
Fats are not soluble in water. Thus, for the body to carry lipids such as cholesterol and triglycerides in the blood, which is water-based, the lipids are mixed with proteins that can dissolve in water and act as carriers for the fats. Different proteins give different characteristics to these lipid-protein mixtures. These lipid-protein mixtures are called HDL (high-density lipoprotein) and LDL (low-density lipoprotein) and neither one of them is good or bad. All dietary fats are needed by the body, just not in excess. If the fats separate from their protein carriers, they can no longer travel in the blood or mix well in cells. This is analogous to the water and oil of salad dressing. In the blood, these floating lipids attach to fatty deposits called plaques on the walls of blood vessels (Figure 2.2). If the plaque becomes large enough, it can close off part of the blood vessel. If part of the plaque breaks off from the vessel wall, it can travel to capillaries, where it may get stuck and completely block the smaller vessel. When this blockage occurs in the blood vessels of the heart, a heart attack results. If this blockage occurs in the brain, a stroke results.
LDL is assembled in the liver from proteins, cholesterol, and triglycerides and sent into the blood to deliver these fats to the body’s tissues. The lipids and proteins tend to separate, especially if there is an increase in blood pressure, as in hypertension. Thus, LDL has earned the name “bad” cholesterol. HDL protein is made in the liver and released into the bloodstream
without any lipids. Its job is to scavenge cholesterol from the body’s tissues and blood vessels. When the HDL proteins are full of cholesterol, they are removed from the blood by the liver and the cholesterol is made into bile, a digestive fluid. Because HDL removes cholesterol from tissues and does not significantly contribute to the buildup of plaque, it has earned the name“good” cholesterol.
The result is the number of calories a person should burn in a day to maintain body weight. If the person eats fewer than this, the person will lose weight. If the person eats more calories than this, the person will gain weight. Table shows the number of calories burned through different activities. When people increase their level of this type of basic physical movement, in conjunction with doing at least five hours of purposeful high intensity exercise per week, the magic starts to happen.
APPROXIMATE NUMBER OF CALORIES BURNED PER HOUR BY ACTIVITY
Activity
| 45 kgs | 68 kgs | 90kgs |
Bicycling 6 mph
| 160 | 240 | 312 |
Bicycling 12mph
| 270 | 410 | 534 |
Jogging 5.5 mph
| 440 | 660 | 962 |
Jogging 10 mph
| 850 | 1,280 | 1664 |
Jumping rope
| 500 | 750 | 1,000 |
Swimming 25 yds/min
| 185 | 275 | 358 |
Swimming 50 yds/min
| 325 | 500 | 650 |
Walking 4.5 mph
| 295 | 440 | 572 |
Tennis (Singles)
| 265 | 400 | 535 |
CONCLUSION
Humans need to eat to gain energy for chemical reactions involving a type of chemical bond called a covalent bond. This bond keeps complex biological chemicals together and requires energy to make it or break it for repair, growth, or development. Metabolic pathways for carbohydrates, proteins, and lipids intersect and allow the body to use nutrients to both make and burn proteins and lipids. Carbohydrates exist as monosaccharides, disaccharides, and polysaccharides, depending on the number of sugar units. Monosaccharides include glucose, fructose, and galactose. Disaccharides include sucrose, lactose, and maltose. Biologically
important polysaccharides come either from plants as starch or from animals as glycogen. Proteins are made from a mixture of 20 amino acids and fulfill a variety of functions in the body. Cholesterol and triglycerides are important dietary lipids. Triglycerides are an important form of long-term energy storage and will be made from excess carbohydrates. Both vitamins and minerals are important in metabolizing the major nutrients of carbohydrates, proteins, and lipids. Deficiencies of vitamins or minerals compromise cell metabolism.
The body takes food and breaks it down into the nutrients it can use, both major and minor. The major nutrients include carbohydrates, proteins, and lipids. Vitamins and minerals are types of minor nutrients . Nutrients serve as building blocks for larger chemicals and the energy that fuels all of the body’s processes, from cellular repair to the use of the muscles. Sometimes foods are described as having empty calories. This means that the item is made mostly of sugar, probably sucrose, and not much of anything else. When carbohydrates are ingested along with proteins, lipids, vitamins, and minerals, they form part of a balanced diet that fills our nutritional needs.
What is especially exciting about nutrition is not just the possibility of prevention, but the reversal of diseases. The body has a tremendous ability to heal itself including repair of the damage to our DNA. Certain vitamins, minerals, and special phytonutrients can promote this healing and strengthen our cells so that they are better able to protect themselves against future injury. In fact, recent evidence has shown that a common herb can rescue injured brain cells even when taken hours after the injury occurs!
|
oercommons
|
2025-03-18T00:36:47.739209
|
05/05/2020
|
{
"license": "Creative Commons - Attribution - https://creativecommons.org/licenses/by/4.0/",
"url": "https://oercommons.org/courseware/lesson/66209/overview",
"title": "Role of Nutrition and Major Nutrients for Human beings",
"author": "datta suryawanshi"
}
|
https://oercommons.org/courseware/lesson/61124/overview
|
Chapter 11 Checkpoint Quizzes
Chapter 2 CheckPoint Quizzes
Chapter 3 Checkpoint Quizzes
Chapter 4 Checkpoint Quizzes
Chapter 5 Checkpoint Quizzes
Chapter 6 Checkpoint Quizzes
Chapter 7 Checkpoint Concept Quizzes
Chapter 8 Checkpoint Quizzes
Chapter 9 Checkpoint Quizzes
Checkpoint Quiz 1.1
Checkpoint Quiz 1.2
Checkpoint Quiz 1.3
Checkpoint Quiz 1.4
Checkpoint Quiz 1.5
Checkpoint Quiz 1.6
Checkpoint Quiz 1.7
Checkpoint Quiz 1.8
Pre-Calculus Quizzes
College Algebra: PreCalculus Quizzes
Overview
Pre-calculus problem sets and quizzes.
CC x BY Lauren Brewer
Chapter 1: College Algebra PreCalculus Quizzes
Set of Precalculus Concept Quizzes
Chapter 2
Set of Precalculus Concept Quizzes
Chapter 3
Set of Precalculus Concept Quizzes
Chapter 4
Set of Precalculus Concept Quizzes
Chapter 5
Set of Precalculus Concept Quizzes
Chapter 6
Set of Precalculus Concept Quizzes
Chapter 7
Set of Precalculus Concept Quizzes
Chapter 8
Set of Precalculus Concept Quizzes
Chapter 9
Set of Precalculus Concept Quizzes
Chapter 10
Set of Precalculus Concept Quizzes
Chapter 11
Set of Precalculus Concept Quizzes
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oercommons
|
2025-03-18T00:36:47.779169
|
01/02/2020
|
{
"license": "Creative Commons - Attribution - https://creativecommons.org/licenses/by/4.0/",
"url": "https://oercommons.org/courseware/lesson/61124/overview",
"title": "College Algebra: PreCalculus Quizzes",
"author": "Lauren Brewer"
}
|
https://oercommons.org/courseware/lesson/99265/overview
|
Introduction to Editing 360-Degree Video in Adobe Premiere Pro
Overview
This step-by-step guide walks creators through the process of uploading, editing and exporting 360-degree video content in Adobe Premiere Pro.
Introduction to Editing 360-Degree Video in Adobe Premiere Pro
This step-by-step guide walks creators through the process of uploading, editing and exporting 360-degree video content in Adobe Premiere Pro.
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oercommons
|
2025-03-18T00:36:47.795081
|
Activity/Lab
|
{
"license": "Creative Commons - Attribution - https://creativecommons.org/licenses/by/4.0/",
"url": "https://oercommons.org/courseware/lesson/99265/overview",
"title": "Introduction to Editing 360-Degree Video in Adobe Premiere Pro",
"author": "Higher Education"
}
|
https://oercommons.org/courseware/lesson/103100/overview
|
Syllabus for "Jesus and the Pursuit of Morality"
Overview
This is a sample syllabus for a moral reasoning course that will explore the historical life of Jesus of Nazareth, analyzing his role, influence, and teachings. We will look at examples of his impact on the lives of other famous historical figures and consider how his moral philosophy can apply to our contemporary life.
The course is designed for students of all traditions, backgrounds, and lifestyles. All faith views will be invited and encouraged to share in civil interfaith dialogue.
Sample Syllabus for a Course about the Moral Philosophy of Jesus
This syllabus is an example of a sample course for a Moral Reasoning requirement for a university or high school curriculum. It dives into the life of Jesus, highlighting the importance of objective discussion and open-minded examination of his teachings. Jesus is a significant historical figure, so studying his moral philosophy and having a decent grasp of things he was documented to have said and did is essential for moral education.
Learning Outcomes:
Students will be able to understand the documented life of Jesus and describe his place and significance in history. (Who was Jesus?)
Students will be able to analyze and interpret the teachings of Jesus. (What did he say? What does it mean?)
Students will be able to discuss Jesus’ moral philosophy and formulate questions about how to relate it to contemporary life. (How do his teachings continue to impact life? What did he say about the contemporary issues we face daily, to include anxiety, relational conflicts, and handling money?)
Students will be able to judge which aspects of Jesus’ moral philosophy individual students will choose to accept as they develop their own moral philosophy and consider how to practically apply these precepts. (How can his moral philosophy influence my decisions?)
Themes will include - love/compassion, anxiety/peace, hope, forgiveness, joy, relationships, conflict, morality, money.
I hope this is helpful for you!
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oercommons
|
2025-03-18T00:36:47.814317
|
Teaching/Learning Strategy
|
{
"license": "Creative Commons - Attribution - https://creativecommons.org/licenses/by/4.0/",
"url": "https://oercommons.org/courseware/lesson/103100/overview",
"title": "Syllabus for \"Jesus and the Pursuit of Morality\"",
"author": "Syllabus"
}
|
https://oercommons.org/courseware/lesson/104859/overview
|
Effective Quote Integration Workshop
Overview
The Effective Quote Integration Workshop aims to enhance students' skills in incorporating quotes into their academic writing. The workshop focuses on several learning outcomes; they include understanding the purpose and significance of quote integration, learning effective techniques for integration, developing critical thinking skills through quote analysis, and evaluating the effectiveness of quotes in supporting arguments.
Effective Quote Integration Workshop Outline
- Prewriting
- Reviewing Sample Work
- Peer Review Workshop
- Post-Workshop Reflection
Effective Quote Integration Workshop
The Effective Quote Integration Workshop aims to enhance students' skills in incorporating quotes into their academic writing. The workshop focuses on several learning outcomes; they include understanding the purpose and significance of quote integration, learning effective techniques for integration, developing critical thinking skills through quote analysis, and evaluating the effectiveness of quotes in supporting arguments.
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oercommons
|
2025-03-18T00:36:47.831410
|
06/08/2023
|
{
"license": "Creative Commons - Attribution - https://creativecommons.org/licenses/by/4.0/",
"url": "https://oercommons.org/courseware/lesson/104859/overview",
"title": "Effective Quote Integration Workshop",
"author": "Soyoung Park"
}
|
https://oercommons.org/courseware/lesson/101306/overview
|
Fundamental Pharmacology for Undergraduate Nurses
Overview
Fundamental nursing pharmacology course focusing on pharmacokinetics, pharmacodynamics, medication errors, drugs across the lifespan, Cultural considerations, complimentary and alternative therapies, and drugs affecting the autonomic nervous system.
Fundamental Pharmacology for Undergraduate Nurses
Material Description
Fundamental nursing pharmacology course focusing on pharmacokinetics, pharmacodynamics, medication errors, drugs across the lifespan, complimentary and alternative therapies, and drugs affecting the autonomic nervous system.
Context for sharing:
Complete OER nursing resources and courses are rare and difficult to find; this course is meant to be a useful offering to nursing educators in Arizona and beyond.
Course link
Common Cartridge
This file can be downloaded and used in most LMS platforms.
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oercommons
|
2025-03-18T00:36:47.850916
|
BAMBI PISH-DERR
|
{
"license": "Creative Commons - Attribution - https://creativecommons.org/licenses/by/4.0/",
"url": "https://oercommons.org/courseware/lesson/101306/overview",
"title": "Fundamental Pharmacology for Undergraduate Nurses",
"author": "Lecture"
}
|
https://oercommons.org/courseware/lesson/58571/overview
|
Identifying Primary Sources
Identifying Primary Sources
Primary sources are key in historical research. Primary sources allow the reader to delve into the actual time period (day, year, decade, century, era, etc.) and catch a glimpse into how the people of the specified time and place wrote, understood, and categorized events, people, and places. What did they emphasize? How much importance did they place on a person? What about that person's religion, social status, economics, race? What did THEY (the author) say happened? Were they correct?
Primary sources are tools. Tools that are used to begin and legtimisze research into the history of subjects. When you can identify primary sources, you can begin to read what people of the time period you happen to be studying might have read and immerse yourself in the mind of the author (Maybe Julius Ceasar, Thomas Jefferson, the editor of the New York Times in 1932.)
To help identify primary sources we have to categorize them: Primary sources are sources that were written/authored at the time/place being studied. For example: If you are studying the American continents during the 15th and 16th century, Christopher Columbus's journal would be a primary source. Why? Becuase it was written during the time period you are studying, the subject is primarily what Columbus discovered in the "New World" (American continents), and becuase the author was present at the location and time.
Compared to secondary sources. Secondary sources are sources written after the time period you are studying. If you are researching Thomas Jefferson and come across a biography of Jefferson written in 1981, then that would be considered a secondary source. Why? It was written after the time period, by a person who was not present during the time period nor had ever met Mr. Jefferson.
Identifying Primary Sources Activity
Assessment
For this section:
There will be a topic of study (The British North American Colonies, for example) given, as well as four example sources.
Your task will be to identify the primary sources. You should record your answers on a word document, and submit them in GeorgiaView in the appropiate assignment folder.
Topic of Study: The American Revolution
Choices:
1) Virginia Declaration of Rights (1776)
2)Constitution of the United States of America (1787)
3)EVEREST, ALLAN S. "The American Revolution 1776–1778." In Moses Hazen and the Canadian Refugees in the American Revolution, 46-65. Syracuse, New York: Syracuse University Press, 1976.
4)Winship, A. E. "WASHINGTON THE PRESIDENT.—(I)." The Journal of Education 53, no. 6 (1901): 83-84.
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oercommons
|
2025-03-18T00:36:47.864815
|
10/05/2019
|
{
"license": "Creative Commons - Attribution - https://creativecommons.org/licenses/by/4.0/",
"url": "https://oercommons.org/courseware/lesson/58571/overview",
"title": "Identifying Primary Sources",
"author": "Nicholas Allen"
}
|
https://oercommons.org/courseware/lesson/96286/overview
|
OFAR Module
Overview
Textbooks & Other Resource Links Finnegan, Lisa. 2020. Medical Terminology in a Flash: A Multiple Learning Styles Approach (4 th Edition).
Publisher FA Davis 2020
ISBN 9780803689534
OFAR Module
Module 1- Learning Styles
Visual-Auditory-Verbal-Kinesthetic
Learning style theory suggests that individuals learn information in different ways according to their unique abilities and traits. Therefore, although all humans are similar, the ways in which you best perceive, understand, and remember information may be somewhat different from the ways other people learn.
In truth, all people possess a combination of styles. You may be especially strong in one style and less so in others. You may be strong in two or three areas or may be equally strong in all areas. As you learn about the styles described in this chapter, you may begin to recognize your preferences and will then be able to modify your study activities accordingly. Try using multiple learning styles as you study rather than choosing one in particular. This will help you make the most of your valuable time, enhance your learning, and support you in doing your very best in future classes.
Sensory Learning Styles
Experts have identified numerous learning styles and have given them various names. Some are described in an abstract and complex manner, whereas others are relatively simple and easy to grasp. For ease of understanding, this book uses the learning styles associated with your senses. You use your senses to see and hear information. You use touch and manipulation or your sense of taste or smell. You may find it useful to think aloud as you discuss new information with someone else. Because the senses are so often involved in the acquisition of new information, many learning styles are named accordingly: visual, auditory, verbal, and kinesthetic (hands-on or tactile).
In this chapter you will learn about the different learning styles and will also be able to determine what learning style or combination of styles are you.
Mrs. Bravo
Action Plan
The OFAR Action Plan consists of the following interventions.
- Review different nursing OER Resources for Medical Terminology
- Evaluate the content of OER Resources is appropriated and aligns to curriculum, SLO’s and Course Objectives.
- Present to Faculty for better feedback.
- Propose OER resources to curriculum committee and nursing faculty
- Integrate an antiracism classroom Module 1 section providing a survey to students to help identify high risk students and to better serve student population.
- Ensure class content delivers in different learning styles.
- Integrate action plan to syllabus and curriculum.
- Review all material and OER resources for appropriateness
- Test the course environment with other faculty and possibly student volunteers for feedback and constructive critique.
- Implement Action Plan and Anti-Racism Classroom into canvas.
Course Description
Course of study is designed to develop competency in the accurate use of medical vocabulary to include anatomy, physiology, diseases, and descriptive terms to prepare students for entry-level positions as medical transcribers, clinical editors, health insurance processors, patient administration specialists
OFAR Module
1. Identify Anti-racism in the classroom
2. Complete The VARK Questionnaire
The assessment consists of 16 questions related to your learning strengths and weaknesses.
The following is the direct link to go to the VARK ASSESSMENT (Links to an external site.)
Objectives
After completing the questionnaire you will be able to identify your learning styles and preferences.
The results will provide you with tools and suggestions to facilitate your learning.
Assignment
Submit a your results to the assignment tab.
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oercommons
|
2025-03-18T00:36:47.884698
|
08/09/2022
|
{
"license": "Creative Commons - Attribution - https://creativecommons.org/licenses/by/4.0/",
"url": "https://oercommons.org/courseware/lesson/96286/overview",
"title": "OFAR Module",
"author": "Carmen Bravo"
}
|
https://oercommons.org/courseware/lesson/108071/overview
|
OER Resources for College-level Music Appreciation Courses
Overview
This collection of OER was curated as part of an OER Background Research mini-grant to locate and evaluate resources for a college-level music appreciation course.
OER Resources for a College-level Music Appreciation Course
OER Resources for a College-Level Music Appreciation Course
There is a wide range of perspectives on and approaches to what ‘Music Appreciation’ is considered to be: the resources below aptly demonstrate this premise. The materials listed are by no means comprehensive. They are taken from the websites listed above and the ‘rabbit hole’ if you will that we experience as researchers. Meaning, by clicking on one link, we are often taken to others and this is what happened as the digging into materials took place.
Arguably, some resources you may come across are not necessarily relevant or appropriate for a college level traditional Music Appreciation class based on the Western Art music Tradition. With that being said, an instructor may choose to extrapolate materials deemed appropriate for the class being taught at the college level.
This researcher was excited to see how materials were linked. For example, you may look for Music Appreciation materials and then come across materials for Jazz, Theatre, Film and Media, World Music and Music Theory among others. Since many college music instructors also teach other courses, this would prove useful. Perhaps click on some of the links provided and explore!
Licensing at the bottom of each page; material presented chronologically; it is a Full Music Appreciation textbook and contains all materials needed for a ‘traditional’ music appreciation course.
2. Course Hero: Music Appreciation Study Guide Site also has classes that may be taken at different schools.
- Early time periods not a part of the materials: begins with the Baroque era.
- Overview of times periods presented and then works (musical examples) pertaining to period or specifics of a period, eg.: Comic Opera/Composer/Russian Five, etc.
- Works/pieces are standard and thorough.
3. Resonance: Engaging Music in its Cultural Context. UNG Press, PDF Available, may also purchase for $43.95.
- This book does not come across as a complete music appreciation course.
- Resources have additional materials that may be beneficial for a course that is already established. In other words, use in conjunction with another text.
4. Music Appreciation (Georgia Gwinnett College), Summer 2017, Multiple authors/contributors. Galileo-open learning materials.
Does need additional materials, will not stand on its own as a text. Into material is not broken down into time periods, and is presented more like an introductory guide to music theory. Could use links to pieces.
- What is Music-has references
- Musical Instruments
- Rhythm-examples of meters-too complicated? Non-western
- Melody, harmony, and texture
- Form
- Multiple modules /reference lists
5. Music Appreciation: Its Language, History, and Culture.
Could not access through OER Commons-said verboten!!
6. Music Appreciation-Open ALG Textbooks-ALG Textbook Grant. Multiple contributors. Created January 2021, Modified March 2021.
- Lower division, website, English
- OER Licensing: CC EY-NC
- TOC set by modules/reference lists-Into materials does not go through time periods. Would not consider this an undergraduate music appreciation textbook. More introductory materials to fundamentals, terminology, etc.
7. Merlot.org-Merlot collection materials
- Predominantly for younger non-college level students; there is a great deal of material out there like this; quite a bit on OER Commons.
- Interactive materials-some of the material may be used in a college level course, but instructor must parse through to make decisions.
- If you follow links, one may access BBC materials and there are good quality musical examples. The website or link might be incorporated in to a course. Would use similarly to YouTube examples. This indicates that the instructor would need to be aware if the link is removed and replace accordingly.
- There is also a link to America’s Jazz Heritage-Smithsonian Link to concerts and recordings.
8. Understanding Music: Past and Present
- Multiple authors and universities across Georgia
- Fundamentals of music, physics of sound, explore Middle Ages (MA) to present and chapter on Music in the U.S.
- ISBN: 978-1-940771-335
- OER Licensing: CC-BY-SA
- Links to YouTube listening; picture and explanations; charts/graphs; listening guides with attributions; Glossary and TOC; some information on World Music in the Appendix
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oercommons
|
2025-03-18T00:36:47.932362
|
Textbook
|
{
"license": "Creative Commons - Attribution - https://creativecommons.org/licenses/by/4.0/",
"url": "https://oercommons.org/courseware/lesson/108071/overview",
"title": "OER Resources for College-level Music Appreciation Courses",
"author": "Student Guide"
}
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https://oercommons.org/courseware/lesson/110249/overview
|
HE 250: Personal Health, Portland Community College
Overview
The Portland Community College Health Studies Subject Area Committee redeveloped the Personal Health course with OERs as a basis for course material, which meets the Health Studies graduation requirement. The project team developed the course into 17 topic modules that cover a broad range of Personal and Public Health health topics. Each topic has a Google Slides Presentation, Instructor Resources, Student Resources, Topic Study Guides, an In-Class Activity, Discussion Questions, and any other additional OER resources available.
This course was created by Valerie Limbrunner-Bartlett, Alissa Leavitt, Shari Rochelle, Rachelle Katter, Michael Meagher, Sasha Grenier, Toni Veeman, Glenn Johnson, and Eldon Lampson, Portland Community College, with grant support from Open Oregon Educational Resources. Click on the links below to access open content for each topic.
Health Disparities & Social Determinants of Health
Healthy Relationships & Social Connections
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oercommons
|
2025-03-18T00:36:47.946804
|
Textbook
|
{
"license": "Creative Commons - Attribution - https://creativecommons.org/licenses/by/4.0/",
"url": "https://oercommons.org/courseware/lesson/110249/overview",
"title": "HE 250: Personal Health, Portland Community College",
"author": "Social Science"
}
|
https://oercommons.org/courseware/lesson/100244/overview
|
Welcome Letter
Overview
This is a welcome letter that I use for my English 101 class at Modesto Junior College but could be used for any course.
ENGL 101 (F2F)
I usually include a picture of myself (and my animals), along with my contact information. It is also helpful to add the link to any welcome quizzes, syllabus, or "getting to know you" surveys from Canvas.
I try to send this note out a week before the start of classes. I find it really does help start making connections with students.
Have a great semester!
Dear Students,
Welcome to our English 101 class. I am so excited to be working with you this semester. Below are some details about our class.
When and how will we meet? (add details)
On the first day of class, please bring a computer or other device where you can easily complete in-class assignments and a writing journal/notebook. If you do not have your own computer, you can borrow one for the semester at the Library and Learning Center just a few buildings down from Founders Hall.
How will I know what to do and where to turn my work in? All class assignments and information will be posted on Canvas. We will go through some of the features of Canvas our first day of class. However, please take some time to poke around if you have some time. The more you feel comfortable with this learning system the easier it will be for you when classes start.
I encourage you to play around with these tools that we will be using throughout the semester. Please complete the following as soon as you are able:
Please go to your Canvas account and complete the “Getting to Know You Survey." Starting from our dashboard, click on modules. You will find the survey under “Course Introduction (Start Here!)” in the top portion. This is an opportunity for me to get to know you better and assess any needs you may have while you explore Canvas.
Sign up for Remind (insert link) - This will be how we communicate with each other. I will also post announcements here.
Keys for success: Please take the time now to think about your schedule and establish a realistic routine. Be kind to yourself along the way!
Sincerely,
|
oercommons
|
2025-03-18T00:36:47.961551
|
01/26/2023
|
{
"license": "Creative Commons - Attribution - https://creativecommons.org/licenses/by/4.0/",
"url": "https://oercommons.org/courseware/lesson/100244/overview",
"title": "Welcome Letter",
"author": "Christine Knight"
}
|
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