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HIST363 Study Guide

Site: Saylor Academy
Course: HIST363: Global Perspectives on Industrialization
Book: HIST363 Study Guide
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Date: Friday, February 4, 2022, 12:06 PM

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Study Guide Structure

In this study guide, the sections in each unit (1a., 1b., etc.) are the learning outcomes of that unit. 

Beneath each learning outcome are:

  • questions for you to answer independently;
  • a brief summary of the learning outcome topic;
  • and resources related to the learning outcome. 

At the end of each unit, there is also a list of suggested vocabulary words.

 

How to Use this Study Guide

  1. Review the entire course by reading the learning outcome summaries and suggested resources.
  2. Test your understanding of the course information by answering questions related to each unit learning outcome and defining and memorizing the vocabulary words at the end of each unit.

By clicking on the gear button on the top right of the screen, you can print the study guide. Then you can make notes, highlight, and underline as you work.

Through reviewing and completing the study guide, you should gain a deeper understanding of each learning outcome in the course and be better prepared for the final exam!

Unit 1: Industrialization and Theories of Economic Change

1a. Name key economic theorists and summarize their main ideas about economic growth

  • Explain the basic economic and political principles behind mercantilism and how Europeans practiced it from 1600–1800.
  • What did Adam Smith mean by the invisible hand? Did he believe in the absolute freedom of the marketplace? Why or why not?
  • Describe the main principles of the Wealth of Nations. Define laissez faire capitalism.
  • What did Max Weber mean by the Protestant ethic? How does it relate to his argument about the development of modern capitalism?
  • What were Karl Marx and Friedrich Engels' basic criticisms of the industrial capitalism of their day? How did this relate to their concept of class struggle?
  • Define the bourgeoisie and the proletariat.

After you have completed the readings in Unit 1, make sure you are familiar with the concept of mercantilism which was the accepted economic theory prior to Adam Smith's seminal work, the Wealth of Nations. The mercantile system was based on the premise that national wealth and power are best served when countries increase exports and collect precious metals, goods and raw materials in return.

Adam Smith, Max Weber, Karl Marx, and Friedrich Engels were four key theorists and philosophers who discussed industrialization and economic change.

Adam Smith (1723–1790), the Scottish economist who many consider the "father" of modern economics, coined the idea of the invisible hand, in which he described how changes in supply and demand for an item typically return to a state of economic equilibrium. When a shortage of a product occurs, businesses usually raise their prices to take advantage of the increased demand. The profit margin they receive encourages other businesses to enter the market, increase production, and cure the shortage. When too many producers flood the market with increased supply, manufacturers are forced to lower the price of their products to get rid of their excess inventory and stay in business. Eventually, the competition among manufacturers achieves a market equilibrium or "natural price".

Max Weber (1864–1920), the German sociologist, believed that traditional hierarchical societies, based on honor, prestige, and religion, tended to dominate and discourage ownership of capital and modern industrial and commercial enterprises. The rise of Protestantism, particularly Calvinist theology (a major branch of Protestantism), influenced the rise of modern capitalism by reducing the importance of these societal hierarchies in favor of individual freedoms and the entrepreneurial spirit. He wrote, "the Protestants of Germany are today absorbed in worldly economic life, and their upper ranks are most indifferent to religion". He describes "materialistic joy" and an "intimate relationship" with "capitalistic acquisition".

While Adam Smith made the case for what would be known as laissez faire capitalism, Karl Marx (1818–1883) and Friedrich Engels (1820–1895) were highly critical of the exploitative nature of industrial capitalism, a social byproduct that Smith tended to ignore and was still in its infancy when he wrote his Wealth of Nations. Known for their views on social and class conflict within society, Marx and Engles witnessed and protested against the extreme poverty and abhorrent living conditions that capitalist practices created in many newly-industrialized cities. They predicted a class struggle would occur between the lower and upper classes over control of the means of production. Marx and Engels advocated the proletariat (the working class) should rise up in revolt against the bourgeoisie (the upper classes and wealthy elite) to support better working conditions. They predicted society would become more stable and equal once capitalism fails.

Review the following resources to find definitions and responses to these questions.


1b. Describe what the Industrial Revolution was and explain why England was one of the first nations to industrialize

  • In what ways was the Industrial Revolution in England based on improvements in agricultural production, what many call the Agricultural Revolution?
  • What natural advantages did England have that helped make the Industrial Revolution possible?
  • How did England's vast colonial empire contribute to it's early industrialization?
  • How did the Industrial Revolution disrupt traditional conventions in social life and psychology, and change prevalent economic patterns?

After you have completed the readings in Unit 1, you should be able to explain how and why the Industrial Revolution developed first in England, a country that possessed many of the right preconditions.

England had experienced an agricultural revolution where mechanized farming equipment was replacing farm labor, had requisite waterpower, had large reserves of iron and coal, and had a vast empire from which to draw the raw materials for industrial production, such as cotton from India and new colonial markets to sell its finished products.

Review the following resources to find definitions and responses to these questions.


1c. Compare classical and contemporary theories of industrialization

  • Define Walt Rostow's five stages of economic development: traditional society, preconditions for take-off, take-off, drive to maturity, and age of high mass consumption.
  • Compare Georg Frederich List's views on tariffs and a national economy with those of Adam Smith. What argument did each use to support their beliefs regarding the question of tariffs?
  • What did Joseph Schumpeter mean by social value? Why do capitalists try to establish monopolies and how can they stifle capitalism in the long run? 
  • Using Walt Rostow's stages of economic development, how would you characterize the modern American economy as compared to that of a developing country?

Make sure you are familiar with Walt Whitman Rostow's five stages of economic development, Georg Frederich List's ideas about tariffs and the creation of a national economy, and Joseph Schumpeter's explanation of entrepreneurship and business cycles. These three economists focused on different aspects of economic development. Their theories have impacted different economies and parts of the world in distinct ways.

Walt Rostow (1916–2003), an American economist, identified five stages of economic development: 1. the traditional society, 2. the preconditions for take-off, 3. the take-off, 4. the drive to maturity, and 5. the age of high mass-consumption.

Georg Frederich List (1789–1846), a German-American economist, described a similar series of stages, but goes a step further by explaining that countries may need to temporarily protect its infant industries (such as through tariffs or quotas) from foreign competition until these industries mature because "these transitions cannot take place automatically through the 'natural course of things,' i.e. through market forces".

Joseph Schumpeter (1883–1950), an Austrian political economist, coined the concept of creative destruction to describe how the new constantly replaces the old. He compared the economy to a living organism, which is constantly growing and changing to maintain its health. Entrepreneurs periodically disrupt existing industries, including the workers, businesses, and entire sectors that go along with it. This is part of the normal business cycle, which supports and promotes innovation and productivity. Many of today's economists look to Schumpeter's work to explain how technology and automation processes have disrupted the manufacturing industry in the current economy.

By social value, Schumpeter refers to the value society places on certain goods, depending on the wants or needs of the entire community. Social value influences that of the individual and the exchange value. For example, I may not like to eat avocados, but I may come to value them and even become an avocado farmer, because the rest of society values them and will buy them from me. I receive something in exchange for the avocados I sell, i.e. money.

Although Schumpeter promoted the benefits of a free market, capitalist innovation, and entrepreneurial growth, he also believed that elements of socialism would eventually replace capitalism due to capitalism's tendency to promote human greed, monopoly, and social inequalities.

Review the following resources to find definitions and responses to these questions.


Unit 1 Vocabulary

  • Adam Smith
  • Age of high mass consumption
  • Agricultural revolution
  • Bourgeoisie
  • Capitalism
  • Class struggle
  • Drive to maturity
  • Enclosure movement
  • Friedrich Engels
  • Georg Friedrich List
  • Industrial revolution
  • Invisible hand
  • Karl Marx
  • Laissez faire capitalism
  • Mercantilism
  • Monopoly
  • Marxism
  • National economy
  • Preconditions for take-off
  • Proletariat
  • Protestant Ethic
  • Take-off
  • Tariff
  • Traditional society
  • Social value
  • Walt Rostow
  • Wealth of Nations

Unit 2: Ancient and Early Modern Industry

2a. Identify and describe important industries in China, India, and the Roman Empire

  • What were some of the negative byproducts of Roman deep vein mining?
  • What were some Roman glass making methods? How did the Romans use the glass it manufactured?
  • What materials did the Romans use for building construction?
  • How did Rome obtain the grain it needed?
  • What role did water play in Roman society and how did the Romans engineer its use?
  • Name four great industrial inventions of ancient China.
  • In what ways did ancient China's workshop system of production foreshadow the modern assembly line?
  • In what ways was copper and bronze metallurgy in China different from metallurgy in the West?
  • Describe the economy of Germania Inferior and how it related to Roman governance of the area.
  • India has a long history of cotton manufacturing that predates that in Europe and was the impetus to England's Industrial Revolution. Discuss cotton production and processing before British colonization in India.

While modern industrial production methods and practices may not have been fully developed in pre-Modern China, India, and the Roman Empire, this does not mean that some form of industrial production did not exist. Roman mining and glassware were highly-developed industries that required technological applications to be successful. Roman glass making was highly developed, highly prized, and has been found as far away as China and Japan.

China perfected bronze metallurgy and bronze production for domestic and military use, and had a highly-advanced industrial process with an early version of the assembly line. In India, cotton production was in existence long before the British arrived and exploited Indian cotton for their own purposes and textile production. Cotton fabric provided an impetus to the Industrial Revolution in Britain.

Review the definitions and responses to the questions above in:


2b. Describe different forms of industry in Early Modern Europe

  • What role did the spice trade play in the development of the early modern European economy?
  • What role did the Dutch East India Company play in global trade from its founding in 1602 until its bankruptcy in 1799?

During the Renaissance (1300–1600), Florence and several Italian cities benefited from their extensive wool processing industry. Business leaders encouraged the creation of a growing banking industry to finance it. For example, wealthy families, such as the Medici, provided major financial support which promoted new industrial operations.

Early forms of capitalism developed in Europe as trade, commerce, and urbanization revived. Beginning in the 12th century, European cities and towns grew as merchants began opening trade routes with the Middle East and East to meet the ever-increasing demand for foreign goods, such as silk, porcelain, and spices, in addition to the industries we detail in Unit 3.

Middle Eastern merchants and traders dominated these lucrative trade routes and marked up the cost to buy these products significantly. European merchants eventually learned how to bypass these middlemen: they created their own trade routes to sail directly to the source and buy the valuable commodities sold in the East Indies. Their efforts stimulated improvements in naval technology, cartography, and created new forms of business organizations, banking arrangements, and insurance providers.

For example, the British East India and Dutch East India companies, which we explore in the next section, became two of the largest and most successful joint stock companies in the international marketplace. Their global reach made them the most profitable trading companies in the world prior to the modern period.

Review this material in:


2c. Explain how early forms of capitalism developed in Europe

  • Define merchant capitalism.
  • How was religious tolerance key to trade in late medieval and early modern Europe?
  • Describe how usury and the Calvinist idea of predestination impacted the rise of early capitalism in the Netherlands?
  • What role did the Hanseatic League play in the development of European capitalism?
  • What role did chartered and joint stock companies play in the development of early modern capitalism?

Trade and commerce resumed during the latter Middle Ages (476 AD–1492), after the collapse of Rome, the revival of European towns and cities, and a return of stability. However, the Roman Catholic Church was an omnipresent force and became an impediment to industrial growth. For example, the church limited excessive profit-making by forbidding usury (money lending at high interest rates) and demanded businesses charge their customers a just and fair price.

During the Reformation (1517–1648) a decline in the power of the Catholic Church and rise of Calvinism eroded the religious dominance that had slowed the rise of the merchant class. Businesses gained the ability to lend money at a market-based interest rate, and would charge prices based on supply and demand with less interference from the church. Calvinism supported the idea of predestination – that monetary and business success indicated God's favor – a belief that would encourage entrepreneurism, investment, and personal wealth.

Capitalism and national forms of industry we discuss in more detail in Unit 3 became widespread in Europe. Merchants found new business and trade routes in addition to their local partners. For example, merchant traders from cities along the Baltic coast – northern Germany, Scandinavia, Russia – created the Hanseatic League (1157–1600), a trans-national commercial network, to facilitate trade and common interests.

Merchants in Amsterdam, Antwerp, London, and Venice also created new business organizations comprised of wealthy investors, called joint stock companies (similar to today's publicly-traded corporations) to finance more expensive trading ventures, such as the long, perilous voyages to India, Indonesia, and the New World which would prove extremely profitable when successful.

Review this material in:


Unit 2 Vocabulary

  • Assembly line
  • British East India Company
  • Calvinism
  • Chartered company
  • Copper and bronze metallurgy
  • Cotton manufacturing
  • Deep vein mining
  • Domus 
  • Dutch East India Company
  • Germania inferior
  • Glassmaking
  • Grain
  • Hanseatic League
  • Joint Stock Company
  • Merchant capitalism
  • Predestination
  • Spice trade
  • Tolerance/toleration
  • Usury
  • Water

Unit 3: Capitalism, Agriculture, and Industry

3a. Assess the effects of the Agricultural Revolution on European societies

  • What accounted for agricultural improvements in England from 1500–1850?
  • Define cottage industry and proto-industry.
  • How was the factory system fundamentally different from the commercial production methods that preceded it?
  • What were the inventions of Jethro Tull, Joseph Fojambe, Andrew Meikle, and John Fowler?
  • How did industrialization contribute to urbanization in England and Europe during the Industrial Revolution?
  • What was the Columbian Exchange and what impacts did it have on the New World and the Old World (Eurasia)?

Several factors prompted the Industrial Revolution in England and Europe. As we discussed in Unit 1, in England, the ready availability of waterpower, sources of iron ore, an abundant coal supply, and raw materials from colonies such as India created a foundation for an industrial revolution.

An agricultural revolution of sorts had preceded these changes: new farming tools and mechanization methods made it easier for farmers to produce more food with less labor.

For example, in 1701 Jethro Tull invented the seed drill which would plant seeds efficiently in neat rows and later developed a horse-drawn hoe. In 1730 Joseph Foljambe produced the first commercially-successful iron plough to replace its wooden predecessor. In 1786 Andrew Meikle developed a threshing machine to remove the outer husks from grains of wheat. In the mid 1800s John Fowler produced a steam-driven engine that could plough farmland and dig drainage ditches more quickly and more economically than horse-drawn ploughs.

While domestic and cottage industries helped European workers transition from an agricultural to an industrialized society, factory production came to dominate the economic landscape.

Proto-industry describes this type of domestic manufacturing and other types of commercial activity that preceded industrialization. Later these newly-unemployed agricultural workers would flock to the urban centers where they would form Britain's new industrial workforce.

Meanwhile, the Columbian Exchange provided a new basis for new agricultural production, as new types of crops from the New World came to supplement the European diet, such as potatoes, corn, tobacco, beans, squash, peppers and cacao. For example, potatoes became a vital means of sustenance for the lower classes across Europe.

Review this material in:


3b. Explain the development of manufacturing in Europe and its effects on Asian industries

  • Discuss the relationship between a cottage industry or domestic system and the factory system in England. In what ways were they complementary and in what ways were they incompatible?
  • How did the industrialization of the textile industry in England impact the Indian textile industry and Indian industrialization? What impact did it have on British and French domestic weavers and their families?

The industrialization of textile manufacturing supplanted artisanal production, a process characterized by minimal automation, little division of labor, and a small number of highly-skilled craftsmen, domestic weaving and cottage industry, particularly in the textile industry. These processes coexisted and complemented each other until full-scale industrialization rendered domestic weavers and cottage industry obsolete. English textile manufacturing, in addition to laws that restricted the importation of Indian cotton, helped impede the Indian textile industry. Indian weavers, textile production, and industrialization in India suffered and forced the country to rely on its agricultural economy until recently.

Traditional cottage industries, which had endured for centuries in England, France and India, were soon replaced by the mass production of cheap and affordable cotton fabric. Industrialization fueled a revolution that changed social and economic patterns that had long existed in all three countries.

Review this material in Cottage Industry and the Factory System by Duncan Blythel and Connections by Louise Tilly.


3c. Describe how slave labor from Africa and natural resources from the Americas assisted industrial development in England

  • What role did slavery play in England's industrial revolution?
  • How did the industrial capitalism of England during the Industrial Revolution rely on natural resources and human capital, in the form of African slaves, for its development and growth?

While England's industrial revolution was based on agricultural consolidation, mechanization, a large supply of coal and iron ore, and water power, we cannot ignore the fact that slave labor from Africa provided the back-breaking labor that harvested the necessary natural resources and raw materials in its colonies.

For example, the sugar industry, which required intensive labor which its slaves provided, reaped huge profits for its owners and investors back in England. This capital provided the basis for the money needed to invest in factories and industrial production for the newly-developing mass consumer market.

Review this material in The Atlantic World Slave Economy by Joseph Inikori and Enslavement and Industrialization by Robin Blackburn.


Unit 3 Vocabulary

  • Agrarian revolution
  • Andrew Meikle
  • Atlantic world
  • Domestic system
  • Columbian Exchange
  • Commercial capitalism
  • Cottage industry
  • Dutch East India Company
  • Factory system
  • Industrial capitalism
  • John Fowler
  • Jethro Tull
  • Joseph Foljambe
  • New World
  • Old World
  • Proto-industry
  • Slavery

Unit 4: The Industrial Revolution in England

4a. Describe how new technology increased industrialization

  • How did technology transform the production of cotton fabric during the Industrial Revolution in England?
  • What were some of the machines used in the cloth manufacturing process?
  • Explain John Merriman's suggestion that the Industrial Revolution was more of a process than an event – that it did not change the way things were manufactured overnight.
  • How did coal and the steam engine contribute to the mechanization of production in early industrial factories?

As we explored in Unit 3, new technology was at the heart of the Industrial Revolution, coupled with access to natural resources such as coal, iron ore, and water power. However, while technology dramatically improved the production of goods such as cotton fabric, it did not fully replace the domestic system or artisan handcrafting overnight. For a period of time they coexisted and complemented each other.

Review this material in Industrial Revolutions by John Merriman and General State of Industry: Coal Mines and Iron Works by John Lord.


4b. Interpret primary source documents to understand why some workers opposed industrialization

  • Who were the Luddites and what did they want?
  • Discuss the transition from domestic textile production to the mechanized factory production of cotton and wool fabric.
  • Do you agree with Andrew Ure's positive assessment of the mechanization of labor in his article, "The Philosophy of the Manufacturers"? Why or why not?

The industrialization process increased the production of goods, made materials cheaper, and helped create a mass consumer market such as the one we have today. However, it also dramatically changed the way we make products and disrupted the lives of the people who made them.

Since the Middle Ages, prior to industrialization, the European economy was built around a local community of craftsmen who made products in local workshops or from home. Industrialization and the factory system moved production from the home and workshop to the factory floor, to a building designed to house the machines that mechanized the production process.

Factory workers lost control of their time and how their day was structured. For example, they often completed one step of a process and never saw the final end product of whatever they were working on. In 1811, this process prompted a group of workers, called the Luddites, to engage in a series of riots that lasted for five years to destroy the machinery that threatened to eradicate their way of life and their community.

Review Luddites from the UK National Archives, Leeds Woollen Workers Petition, 1786, Letter from Leeds Cloth Merchants, 1791, and The Philosophy of the Manufacturers by Andrew Ure. 


4c. Identify major developments in transportation technology

  • What role did the improved production of steel have as the basic foundation of the transportation revolution based on the steam engine?
  • What impacts did the invention of the steam locomotive have on European society during the Industrial Revolution?
  • What impacts did the steam ship have on travel and transport during the Industrial Revolution?

The introduction of the steam locomotive and the steamship revolutionized the transportation systems in England, the United States, and elsewhere. But, steam power and the technology behind these inventions were based on the improved production of steel, in terms of the quantity and quality of the steel produced. So, the transportation revolution was predicated on improved steel production in combination with the invention of the steam boiler.

Review A Brief History of Iron and Steel Production by Joseph Spoerl, Railroads and Their Impact (c.1825-1900) by Chris Butler, The Iron-Hulled Ocean-Going Steamship, 1870–1914 by Brad DeLong.


4d. Explain how knowledge about industrialization spread within and beyond Europe

  • How did British textile manufacturing secrets get to the United States?
  • What role, if any, did patents play in early manufacturing in England and the United States?
  • How did Eli Whitney's cotton gin revolutionize the production of cotton and cotton textiles, as well as the course of American history?

As the Industrial Revolution in England developed, its technology spread. Despite efforts to keep the construction and processes of its machinery secret, such valuable knowledge could not be held under wraps for long. Enterprising individuals brought copies of the English fabric processing machinery to the United States and created similar machines and factories in places such as Lowell, Massachusetts.

While patents may protect your invention and make you wealthy, these legal agreements often failed in the long-term. Inventors simply produced a similar machine or were able to profit in other ways. The invention of spinning jennies, water frames, and power looms initiated the Industrial Revolution in England. However, the single most important and influential invention in the United States was Eli Whitney's cotton gin. This machine made cotton production profitable, helped kick start the Industrial Revolution in the United States, and changed the course of American history by reinvigorating slavery and causing it to spread throughout the southern states.

Review Intellectual Property Rights, the Industrial Revolution, and the Beginnings of Modern Economic Growth by Joel Mokyr, Eli Whitney's Patent for the Cotton Gin by Joan Brodsky Schur, A Manufactured City: Lowell's Grand Experiment by Katharine Dunn, and Immigration and Emigration: Industrial Espionage.


Unit 4 Vocabulary

  • Cotton Gin
  • Intellectual Property Rights
  • Luddites
  • Patent
  • Spinning Jenny
  • Water Frame

Unit 5: The Social and Political Impact of Industrialization

5a. Describe how the growth of industry led to increased urbanization in Europe

  • John Merriman discusses how European cities differ from American cities in the way that social classes inhabit those cities. What does he say about this? How did industrialization change the way European cities were structured?
  • In what ways did industrialization and urbanization go hand-in-hand in 19th century Europe.
  • What role did the labor of women and children play in the Industrial Revolution?

Industrialization in Europe helped intensify the urbanization of European society, as more factories and industrial production moved from the countryside and city periphery into the urban centers. Factory owners preferred this centralization since it promoted a sort of social control of the working classes, who may have had more independence if they had lived further from their workplace.

During this time, successful working class entrepreneurs and small businessmen began to emerge as an expanding urban middle class. These individuals were not part of the traditional aristocracy or the peasant or working classes, but created their own new middle class culture.

Industrialization also meant many families had to supplement their meager wages through the employment of women and children. Women were still responsible for running the household: those who were employed outside the home primarily worked as domestic servants, but some worked in factories, especially if they were unmarried. In addition, children were often needed to supplement the family income as factory workers.

Review Nineteenth Century Cities by John Merriman, Women's Work in the Industrial Revolution (at 16:29), and Childhood and Child Labour in the British Industrial Revolution by Jane Humphries.


5b. Analyze the effects of the Industrial Revolution on the politics and ideologies of the middle and working class

  • What characteristics distinguished the Victorian middle class from the working class and aristocracy in England?
  • Describe the socioeconomic values the expanding English middle class held in the 19th century.
  • How did the passage of the Reform Acts expand political participation and enfranchisement of the English middle class during the 19th century? 
  • Describe some of the ideas of the Utopian Socialists. In what way were they a reaction to the industrialization of European society in the 19th century?
  • Define Chartism. What reforms did the Chartists seek to enact? Why did Chartism decline?

Industrialization in England created a new and expanding middle class that created a unique social identity based on the concept of merit, rather than privilege and inheritance. Many began to encourage a new belief in personal and social progress. The emerging middle-class valued principles of competition, thrift, prudence, self-reliance, and personal achievement. They also emphasized personal responsibility, freedom of action, and individual self reliance as avenues to success. These values were distinct from the social norms of the aristocracy, which were based on privilege, hierarchy, and social class status.

In the early 1800's, utopian socialists were a group of philosophers who envisioned creating a futuristic utopian society built on principles of community, socialism, and classlessness.

For example, Robert Owen (1771–1858), a wealthy Welsh textile manufacturer, championed the working class, led the development of cooperatives, and supported trade unions, child labor laws, and free co-educational schools. Charles Fourier (1772–1837), a French utopian socialist, advocated for a society based on natural passions to foster social harmony. He supported the emancipation of women and coined the word féminisme in 1837.

The Reform Act of 1832 gave English middle class men the right to vote, but disenfranchised members of the working class. Chartism was the English political movement 1836–1848 that advocated for the rights of the working class. The Second Reform Act of 1867, the 1884 bill, and the 1885 Redistribution Act expanded the right to vote to even more men, so that voting became a right rather than the property of the privileged. English women did not obtain the right to vote until 1918.

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5c. Discuss the causes, spread, and events of the Revolutions of 1848

  • While a single cause or event did not trigger the Revolutions of 1848, the countries where they occurred did share some similarities. Discuss the motivations for revolution in France, the area that is now Germany, Italy, and the Austrian Empire.
  • What was the Congress of Vienna? What role did economic issues, the French Revolution, and the Industrial Revolution play in the Revolutions of 1848?
  • Why were there no revolutions in England and Russia during this time period?

The Revolutions of 1848 were a complex series of events, unique to each European country that experienced them. At their core, the protesters were inspired by the political ideals of the French Revolution. They protested various issues, such as the price of grain, economic hardship, harsh working conditions, and petitioned for the right to vote.

These revolutionaries opposed the repressive conservatism that pervaded France after the final defeat of Napoleon and the terms of the Congress of Vienna. Their leaders also protested the industrialization of labor and were influenced by the rise of various socialist movements. But, many of the participants – the working classes and newly developed bourgeoisie – had different goals and they rarely united in their opposition to conservatism and monarchism. Consequently, the revolutions failed.

England avoided revolution – largely due a greater sense of political legitimacy among the public. The Reform Act of 1832 had given middle class men the right to vote, the Chartist movement provided a way for ordinary people to petition their grievances, and trade unions had formed to protect the health and welfare of the working classes. Meanwhile, the Russian monarchy and state were able to suppress the peasant and working classes who tried to organize against them.

Review Nineteenth Century Cities by John Merriman, Chartism by James Chastain and French Economic Situation 1847-1852 by Yvonne Crewbow.


5d. Compare primary source documents to explain the ideals and goals of the Revolutions of 1848

  • Using primary source documents, discuss the ideals, goals and achievements of the Revolutions of 1848. What did the revolutionaries hope to achieve? Why did they fail?

It is difficult to define one particular reason for the Revolutions of 1848, because the outbreak of rebellion was different in each country and motivations were unique to each. The revolts primarily resulted from a food crisis and famine that began in 1846, coupled with various political aspirations. While some members of the working class participated, the bourgeois or middle classes led the rebellions to protest the privileges of monarchy.

The leaders aimed to create republican or constitutional governments with universal male suffrage and limited government. Many of these revolts were liberal rebellions against monarchical governments which the Congress of Vienna and Klemens von Metternich (1773–1859), the Austrian diplomat, had reimposed following the defeat of Napoleon. Nationalism played a major role, particularly by the German and Italian liberals who sought German and Italian unification.

Review this material in the Documents of the Revolution of 1848 in France, A Look Back at 1848 by Carl Schurz, and Conservative Resistance to Revolution in France by Steven Kale.


Unit 5 Vocabulary

  • Charles Fourier
  • Chartism
  • Congress of Vienna
  • Napoleon Bonaparte
  • Reform Acts
  • Revolutions of 1848
  • Robert Owens
  • Utopian Socialism

Unit 6: Imperialism and Industrialization in Asia

6a. Explain the different outcomes of industrialization in China and Japan

  • Western imperialism affected China and Japan during the 19th century in different ways. Explain the differences between how each responded to Western economic imperialism.
  • Describe Kenneth Pomeranz's views on the economic divergence of China and East Asia in the 19th century.
  • What obstacles to economic development affected China in the 19th century that did not impact England or Japan?

Many believed that China and East Asia failed to industrialize in the 19th century because they were socioeconomically inferior to the West, and to England in particular. However, new research indicates that China had the resources to undergo an industrial revolution, but failed to modernize due to Western imperialism and colonialism, not economics. Japan, on the other hand, responded to the threat of Western imperialism by undergoing its own industrial revolution. By 1900, Japan had met or exceeded the West in this regard.

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6b. Describe European colonial expansion under the New Imperialism

  • What was the purpose of the Berlin Conference of 1884-85? What resulted from this meeting?
  • Japan first opened its doors to European missionaries and trade, but closed them again for a 200 year period. What prompted the Japanese to emerge from isolationism in 1853 and what resulted?
  • How did the Meiji Restoration and its new government change the course of Japanese history, particularly in terms of economic development and imperialism?
  • What was the New Imperialism and how was this exemplified by the Scramble for Africa? How did it contribute to the outbreak of World War I?

The so-called period of New Imperialism during the late 1800s and early 1900s represented a second wave of European expansion and colonialism, joined by the United States and the newly industrialized country of Japan. This period began with the Berlin Conference of 1884-85 where the European powers defined their spheres of influence by carving up Africa and parts of Asia. It reflected a new rivalry among the European powers who sought new supplies of natural resources, commercial markets, and military outposts. It also reflected a belief in the "civilizing ethos" which Rudyard Kipling expressed in his poem, "The White Man's Burden".

The United States effort to gain colonies prompted its involvement in the Spanish-American War in 1898 and resulted in its takeover of the Philippines, Guam, and Puerto Rico. The United States also annexed the state of Hawaii in 1898. Japan quickly industrialized, began its takeover of Korea, put pressure on China and Russia, and eventually initiated the Russo-Japanese War of 1904–1905, which it won after its surprise attack on the Russia fleet at Port Arthur.

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Unit 6 Vocabulary

  • Berlin Conference
  • Commodore Perry
  • Meiji Restoration
  • New Imperialism
  • Scramble for Africa
  • Sphere of influence

Unit 7: Mass Production, the Labor Movement, and the Consumer Society

7a. Identify major changes to the way companies organized and managed themselves

  • What did Henry Ford contribute to the manufacturing process? Describe some criticisms of his production system.
  • Describe Frederick Taylor's ideas on time management and how these principles were applied to the manufacturing process in the early 1900s?
  • Define social Darwinism and scientific management.
  • Define trust, cartel, and monopoly.
  • Discuss how corporations reorganized and restructured their manufacturing processes during the Second Industrial Revolution, including the formation of monopolies and cartels.
  • Define the beliefs Andrew Carnegie held about wealth in his book, The Gospel of Wealth.

A second Industrial Revolution occurred during the late 1800s to early 1900s with the rise of the modern corporation. Powerful business leaders created large companies that focused on manufacturing products such as automobiles, steel production, oil, railroads, and telegraph (later telephone) communications. Electrification of factories allowed manufacturers to introduce new machinery to the production process to improve productivity.

In 1901, Henry Ford, the American industrialist and business magnate, founded what would become the Ford Motor Company, and further developed the assembly line technique of mass production. The company introduced the Model T in 1908, a car that was affordable, easy-to-drive, and easy-to-repair. Ford elicited a huge marketing and publicity machine that ensured every newspaper carried stories and ads about the car and a network of local dealers made it ubiquitous in almost every city in North America.

The concept of social Darwinism referred to the belief that the most productive and efficient industries would survive and prosper, while those that were less competitive would fail. Some industrial manufacturers studied principles of scientific management in which managers aimed to eliminate unnecessary motions by workers which slowed the production process. While some admired this examination of workplace efficiencies, others complained they reduced workers to mere robots.

Large corporations frequently created trusts, cartels, and monopolies to increase their profits by driving their competitors out of business. This led to new government legislation that attempted to curtail these unfair practices. Meanwhile, workers were reduced to working on endless assembly and production lines, where they repeated the same monotonous tasks all day long.

Andrew Carnegie (1835–1919), the Scottish-born American businessman, argued in his book, The Gospel of Wealth, that the life of a wealthy industrialist should include two parts: first gathering and accumulating great wealth and then distributing it to benevolent causes. Carnegie wrote that a "man who dies rich dies disgraced". True to his word, Carnegie built libraries, provided pensions for university professors, and funded music halls, outdoor swimming pools, and church organs. He also created endowments to promote teaching and world peace.

Review The Rise of Big Business, The Lords of Industry by Henry Demarest Lloyd, and Fordism, Post-Fordism and the Flexible System of Production by Fred Thompson.


7b. Explain the development of organized labor and its conflicts with capitalists in the United States, Europe, and Asia

  • Discuss the formation of the following unions in American labor history: the Knights of Labor, the American Federation of Labor (AFL), and the International Workers of the World.
  • In what ways were they similar? How did they differ? Which was most successful in the long run?
  • What were the main sources of worker unrest during the Second Industrial Revolution?
  • What are some examples of major strikes in American, European, and Asian labor history?

As the leaders of modern corporations and industrial capitalists were reshaping the world, workers were at a great disadvantage because they were unable to improve their pay and working conditions. Leaders of the unionization movement began fighting for the rights of workers, but the struggle continued for decades until they succeeded in forcing government intervention to prevent abuses. Workers frequently used violence to achieve basic rights that included reduced work hours, increased pay, and enforced safety regulations to protect their health and livelihood.

In the United States, Eugene Debs (1855–1926), an American labor and political leader, helped found the International Labor Union and the Industrial Workers of the World (IWW). He was influenced by Karl Marx and supported the struggle for fair pay and better working conditions. He believed basic rights were often linked to social class, an unpopular belief in the United States where many claimed class did not exist. Samuel Gompers (1850–1924), who held similar views, founded the American Federation of Labor (AFL), which he led for all but one year from 1886 until his death in 1924.

Review the beliefs of political activists such as Karl Marx from Unit 1 who criticized the exploitative nature of industrial capitalism. Marx encouraged the proletariat to rise up in revolt against the bourgeoisie to promote better living and working conditions. This sentiment provided the philosophical basis that fueled worker and peasant rebellions, and the communist revolutions in Russia in 2017 and China in 1949.

Review Mass Politics and the Political Challenge from the Left by John Merriman, The Formation of Japanese Labor Movement, 1868-1914 by Kazuo Nimura, and Chinese Tailors' Strike in Shanghai by Fusataro Takano.


7c. Identify changes in agriculture caused by industrialization

  • How were industrial techniques and processes applied to agriculture from the late 1800s to mid 1900s?
  • Define the green revolution. How did the application of chemical fertilizers and pesticides impact food production in the United States and globally? What were and are some of the negative impacts of industrial farming on the environment?

Industrialization not only changed the way we work, but it also changed the way we produce food, and what and how we eat. The introduction of large-scale mechanized farming and the use of chemical fertilizers, improved seed strains, and pesticides has produced an abundance of food during the past century. These new farming methods were recently termed the green revolution.

Starvation has been eradicated in many parts of the world, but many argue we are paying for this progress in terms of environmental degradation, public health, and sustainability.

Review A Brief History of Agriculture and Food Production: The Rise of Industrial Agriculture by Shawn Mackenzie.


7d. Describe methods of mass communication and advertising in the late 19th and early 20th century United States

  • What techniques did newspapers and the advertising industry use to appeal to the newly developed mass consumer culture of the late 19th and early 20th Centuries?

Beginning in the late 1800s, a mass media culture developed in the United States with a new middle class and growing working class. As with the production of Henry Ford's Model T, this new mass media culture appealed to the new consumerism that accompanied these mass marketing appeals. The sensationalism of news events and compelling product endorsements, which meant to solve a problem or address a concern, also increased sales within the newspaper industry.

Review The Rise of Mass Communication and Understanding Advertising by Michael O'Malley.


Unit 7 Vocabulary

  • Andrew Carnegie
  • Cartel
  • Eugene Debs
  • Gospel of Wealth
  • Green revolution
  • Henry Ford
  • Model T
  • Monopoly
  • Samuel Gompers
  • Scientific management
  • Social Darwinism
  • Trusts

Unit 8: Economic Crisis and War in the 20th Century

8a. Interpret the effect of industrialization on warfare using a variety of primary and secondary sources to contextualize World War I as an industrial war

  • Lenin argued that imperialism was the final outcome of capitalism. Was he right? Why or why not? In what ways can we apply his theory to World War I?
  • What new military weapons were introduced in World War I?
  • How did the participants in World War I apply industrial technology and production to warfare? Why did these new applications result in horrific mass casualties?
  • In what ways did military leaders fail to understand how new military technologies had made their strategies and tactics obsolete?

Several factors helped catapult Europe into World War I, although Gavrillo Princip's assassination of Archdulke Franz Ferdinand in 1914 provided the initial spark. Competition among the European powers for colonies was a primary cause, such as disagreements that erupted over Morocco and the Congo among German, France and Britain.

Russia's Vladimir Lenin had described imperialism as the last stage of capitalist development. The colonies had become a valuable source of natural resources and a market to sell finished consumer products. Combined with militarism, ethnic discontent, and a complex web of military alliances, the European leaders had created a tense atmosphere that resulted in the outbreak of war in 1914. 

Military leaders at the time tragically failed to realize the technological changes that had occurred during the Industrial Revolution. The mechanization of warfare and mass production of new weaponry created a military stalemate where millions of soldiers and civilians were killed and maimed. The industrialization of warfare had rendered traditional military strategies and tactics obsolete and useless. The generals refused to understand this and led what was supposed to be a quick and relatively bloodless conflict into one of the bloodiest events in human history.

Review Division of the World among Capitalist Associations by Vladimir Ilyich Lenin, Age of the Mass, 1914–1939: World War One, and America and World War I by Henry J. Sage.


8b. Identify the main events of the Great Depression and identify ways in which governments tried to recover from the Depression

  • What were some of the main causes of the Great Depression?
  • How did the Great Depression shake confidence in unfettered laissez faire capitalism?
  • What were the basic premises of Keynesian economics? How did President Roosevelt apply its principles to the U.S. economy after his election in 1932?
  • What measures did Roosevelt take to stabilize the U.S. economy and stimulate a recovery?

In the United States the Great Depression (1929–1933) was an unintended consequence of the booming economy that followed World War I, the so-called Roaring 20's. The postwar prosperity, and social changes that came with it, made Americans believe the economy would continue to grow and expand forever: the laissez faire capitalism and government of Adam Smith were the new norm. Speculation in the stock market, buying and selling stocks on margin, the proliferation of debt, and a lack of government regulation created the perfect conditions for an economic collapse.

When the stock market crashed in 1929, the Hoover administration relied on outdated economic ideas that suggested it should keep government involvement to a minimum. As the economy spiraled downward, Hoover was unable to restore confidence in the economy or the government's ability to stabilize it.

Following his election in 1932, President Franklin D. Roosevelt took an active role in restoring economic confidence. Roosevelt increased government spending in accordance with his belief in Keynesian economics. John Maynard Keynes (1883–1946), the British economist, believed the government should pump money into the economy to stimulate activity, promote business growth, and pay off the deficit once prosperity returned. Between 1933 and 1939 Roosevelt and Congress worked to jump start the economy by enacting the New Deal, a series of programs, public work projects, financial reforms, and regulations.

Roosevelt created new agencies and programs to bring about recovery, and imposed new regulations on the stock market, banks, and businesses. These policies were beginning to have a positive impact, but the outbreak of World War II, and mobilization for war, created the most dramatic economic improvement. U.S. industries profited enormously from increased sales to Britain, other Allied forces, and the U.S. government when it entered the war in 1941. As a result, the United States emerged from World War II in 1945 as an economic and military superpower.

Review Great Depression by Gene Smiley, Economic Recovery in the Great Depression by Frank G. Steindl, and The Old Order Falls, A Capitalist Collapse, and Global Depression.


8c. Explain the economic causes and effects of World War II

  • What were some of the economic factors, particularly in Germany, that led to the outbreak of World War II? What other factors contributed to the outbreak of the war?
  • How did the U.S. government and economy mobilize for war?
  • What impact did the war have on the U.S. economy and American society as a whole?

While multiple factors led to World War II, economic realities in Europe played a huge role. Germany was reeling from the impact of military defeat in World War I. The excessive war reparations the Treaty of Versailles imposed caused great economic hardship and resentment among the German people. Rampant inflation devalued Germany's currency and led to social strife and political conflict. These conditions set the stage for the rise of Adolf Hitler and the Nazis who promised to redress the grievances, fix the economy, and make Germany politically and militarily great again.

The eventual outbreak of war in Europe, and U.S. involvement after Japan attacked Pearl Harbor, led to rapid mobilization and the increased industrialization of the U.S. economy. The United States not only sold munitions to its allies, but was able to meet the challenge of fighting a war on two fronts against Germany and Japan.

Review Causes of World War II, The American Economy during World War II by Christopher J. Tassava, and Worldwide War, Planning the Peace, and Pilgrim's Monument.


8d. Explain the importance of the Bretton Woods Conference and the Marshall Plan to the restructuring of the world economy on U.S. terms

  • What was the purpose and outcomes of the Bretton Woods Conference? What organization did the conference create to assist with postwar economic recovery.
  • What were the main aims of the Marshall Plan? How was it developed and what were its outcomes?

At the end of World War II in 1945, the allied powers resolved to avoid repeating the mistakes they had made after World War I. Participants at the Bretton Woods Conference (1944) began establishing a new global financial system that would create a new system of foreign exchange, prevent competitive devaluations of currencies, and promote international economic growth. They created the International Bank for Reconstruction and Development (IBRD) and the International Monetary Fund (IMF) to help countries rebuild and develop local economies which had been decimated during the war.

In 1948, the U.S. Congress enacted the Marshall Plan which would provide more than $15 billion in funds to countries in Europe that needed help to rebuild. The fund provided food relief and aid for the physical reconstruction of war-torn Europe. The Russians and Soviet Bloc countries refused to participate.

Review The Conference at Bretton Woods and The Marshall Plan.


Unit 8 Vocabulary

  • Bretton Woods Conference
  • Herbert Hoover
  • Imperialism
  • International Bank for Reconstruction and Development (IBRD)
  • International Monetary Fund (IMF)
  • John Maynard Keynes
  • Keynesian economics
  • Laissez faire capitalism
  • Marshall Plan
  • The New Deal
  • United Nations

Unit 9: Alternative Models of Industrialization

9a. Compare Soviet and Maoist industrialization with each other and with capitalist industrialization

  • Define war communism. Why did Lenin replace it with his New Economic Policy, NEP?
  • What did Lenin mean by the Commanding Heights of the Soviet economy?
  • Why did Stalin end the NEP and what did he replace it with?
  • What were the objectives of the Great Leap Forward? Why was it a failure? What were its results?
  • How did Soviet and Chinese Communist industrialization differ from industrial development in capitalist countries, such as Britain and the United States?

The Russian Revolution of 1917 and Chinese Revolution offer examples of alternative forms of industrialization. After he had helped create the Soviet state in Russia, Vladimir Lenin (1870–1924) introduced a state-controlled economy that was characterized by the expropriation of private businesses, the nationalization of industry, and the forced state requisition of surplus grain and other food products.

These policies led to food shortages, a decline in agricultural and industrial production, and civil unrest, which convinced Lenin to introduce his New Economic Policy, NEP, in 1921. The NEP meant a temporary retreat from the doctrinaire centralization of the economy and the reintroduction of capitalism to the economy. While the government retained control of the "Commanding Heights" of the economy (banking, foreign trade, and large industries), it fostered a mixed economy that allowed private ownership of small businesses and enterprises. The NEP continued until 1928, following Lenin's death in 1924.

Following his rise to power, Joseph Stalin (1878–1953) abandoned the NEP in 1928 when he introduced his first Five Year Plan to dramatically increase Soviet industrial production and force the collectivization of agriculture. While his industrial goals were unrealistic, Stalin managed to dramatically increase the industrialization in the new Soviet Union. However, when he forced the collectivization of agriculture, millions of farmers and agricultural workers starved to death when they were left with too little of their crop to live. Agricultural collectivization was a failure for the Soviet state.

The Chinese Revolution of 1949 introduced a second alternative form of industrialization and a state-controlled economy. After the Communist takeover, its new leader Mao Zedong nationalized most, but not all, of China's industries. The government embarked on an extensive land reform program which redistributed land from more prosperous farmers and landlords to peasants who had little or no land.

From 1953 to 1957, China embarked upon its own five year plan which was quite successful. However, in 1958 Mao Zedong decided to change course and speed up economic and industrial development through his Second Five Year Plan, the so-called "The Great Leap Forward". Forced collectivization and industrialization, and attempts such as backyard iron furnaces, led to a dramatic agricultural failure and the deaths of an estimated 45 million people.

Review the Soviet Union in Communism in the Heights, 1917: Economic Apparatus, 1921: The New Economic Policy, 1924: Industrialization Debate, 1929: Shock Workers, and 1929: Year of Great Change by Lewis Siegelbaum.

Review China in China in the 20th Century, China: The Great Leap Forward, 1958–60, and Great Leap Forward. 


9b. Assess the effects of British rule on India and identify major economic developments since India gained independence

  • What major impact did British colonial rule have on India from a political, economic, and social standpoint? Did life change significantly for the average Indian? What about the elites?
  • How did British rule in India help or hinder Indian economic and political development? In what ways might it have provided a foundation for Indian national unity in the Post-Colonial period?
  • How did India's mixed economy exemplify positive and negative aspects of central economic planning? Why did central planning ultimately hinder economic development?
  • Define import substitution industrialization. How was it applied in Latin America and Africa? What were its successes and failures?

While, post-revolutionary Russia and China fostered economic development and created a state-controlled economy based on central planning and five year plans, India pursued an economic "Third Way" which favored a mixed economy. When it gained political independence from Britain in 1945, the state controlled major industries, but encouraged small businesses and enterprises to operate within a typical capitalist framework. The Indian government also retained the foundation of parliamentary democracy which it had inherited from British colonial rule.

Many developing countries in Africa and around the world copied India's mixed economic model. While some argue that their centralized planning helped develop basic industries and foster economic development, others believe it may have delayed greater growth and the bureaucratization of the economy.

For example, India and Latin America promoted import substitution industrialization to promote domestic production with mixed results. Domestic industries were established, but production levels and product quality suffered due to a lack of foreign competition. Nevertheless, the state-sponsored support system provided an economic foundation that allowed businesses to eventually integrate into the global economy. This support likely helped cultivate the robust economic growth many of these countries are experiencing today.

Review The Economic and Social Impact of Colonial Rule in India, India's Way and India's Permit Raj, and Import Substitution Industrialization.


Unit 9 Vocabulary

  • Commanding heights
  • Five year plan
  • Great Leap Forward
  • Import substitution industrialization
  • Joseph Stalin
  • Kulaks
  • Mao Zedong
  • Mixed economy 
  • New Economic Policy, NEP
  • Vladimir Lenin
  • War communism

Unit 10: Globalization and the Industrialization in the Late 20th Century

10a. Summarize the main developments in the global economy since 1945

  • What characterized German economic development and prosperity in the postwar period? Why was the German postwar economy dubbed an economic miracle?
  • What is meant by soziale Marktwirtschaft or a social market economy?
  • What accounts for the economic prosperity of the United States in the post World War II era? What social and economic changes characterized the 1950's and early 1960's.
  • Why did the economic growth of the postwar period result in economic stagnation and inflation in the late 1960's and 1970's and what remedies did governments attempt to kick start it again?
  • What was the impetus behind the creation of the Europe Economic Community or European Union? Has it been successful at creating an integrated European economy and society since its inception?

With the end of World War II, the United States experienced a huge, continuous economic boom and period of prosperity that lasted nearly 30 years. This resulted from the return of millions of servicemen and women from the war and the transition back to a consumer economy, along with the pent up demand for housing and goods and services after years of government rationing for the war effort. The demand for housing led to the growth of suburbs, the first shopping malls, and the creation of a thousands of miles of new roads and highways, which created the U.S. interstate highway system.

In Europe, economic growth and development resulted from the massive need to rebuild after the physical destruction of the war as well as the economic consequences of it. In countries like Germany, the Marshall Plan provided funds for rebuilding the country and similar funds were provided for Japan and other countries devastated by the war.

After difficulties in the early years, both Germany and Japan rebuilt their countries and economies and by the 1960's they were well on their way to economic recovery and prosperity. In Europe, the creation of the European Union helped pave the way for economic growth and development and in Asia, by the 1970's, Japan had become the major economic power, and a major exporter to the United States. By the 1980's and 90's more Asian countries began to experience dramatic economic growth as they shook off protectionist ideas and began to embrace free market solutions to their economic development and prosperity, contributing to the growth of a new global economy through the process of globalization.

Review Germany: The Social Market Economy, Germany: The Economic Miracle and Beyond, United States: The Postwar Economy: 1945–1960, Chicago against the Tide, The Specter of Stagflation, and A Mixed Economy Flounders.


10b. Connect the Western decline in manufacturing with the rise of new industrialization in Asia

  • How did the industrialization of Asia negatively impact manufacturing in the United States from the late 1960s and 1970s onward?
  • Why did import substitution industrialization in countries like India and, in Latin America and Africa, give way to free market capitalism and how has this contributed to the globalization of the world economy?
  • How did countries like Japan, Korea, and Taiwan transform their economies after societies and economies after World War II to become major industrial powers?
  • How did India's switch from protectionism and state regulated capitalism to free market capitalism propel its economic growth in the last several decades?

With the rise of industrialization and dramatic annual economic growth rates, Asia made inroads into American manufacturing beginning in the late 1960s and early 1970s – Japan led the way, followed by Hong Kong, Korea and China during the 1980s and 1990s, and India and Southeast Asia more recently.

Since the cost of labor is so significantly cheaper in Asia, especially China, many U.S. companies began to outsource their manufacturing and production lines in the 1990s. The United States saw the decline of entire industries, including the manufacture of automobiles, clothing, children's toys, and electronics.

In post-industrial America, manufacturing has declined as a percentage of its economic system, while the information processing and service sectors have grown. This shift has disrupted several industries and urban economies, such as Chicago, Detroit, Milwaukee and Pittsburgh for example, but created new ones such as the tech sector in places like Silicon Valley in California.

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10c. Explain the effect of the fall of the Soviet Union on the global economy

  • How did the collapse of the Soviet Union and its failed socialist economic model change the economic development policies of countries like India, as well as those in Latin America and Africa? 

The collapse of the Soviet Union is probably the most important dramatic event in recent world history. Until its dissolution in 1991, the Soviet Union seemed to offer an alternative model for economic organization and development with a state controlled economy and state capitalism. In the early years of the Soviet Union, especially with Stalin's Five Year Plans during the 1930's, the government seemed to demonstrate that central planning could allow a backward economy to catch up and surpass capitalist economies such as those of the United States.

During its final decades, the rigidly-controlled economy of the Soviet Union began to show its cracks with increased stagnation, a lack of consumer production, and a growing desire for political reform and political participation. With the fall of the Soviet Union, and its failed economy, the old model of central government planning and protectionism gave way to a general movement toward free markets and political, social, and economic changes, such as the free market capitalism China, India, and countries in Latin America adopted.

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10d. Identify the key features of the current global economy

  • Discuss the transition from protectionist state-controlled economies in the developing world, to the current model of free trade and free market globalization? What contributed to this dramatic change in economic policy, particularly in developing countries.
  • How did the General Agreement on Tariffs and Trade (GATT) evolve into the World Trade Organization (WTO) and what role does it play in the global economy?
  • What are some of the criticisms of how the WTO operates? Are they justified? Why or why not?
  • How has globalization changed the world? What are its benefits and its failures? Is a positive or negative development in the final analysis?

Since the early 1990's we have seen the emergence of a new era of globalization and the growth of what we call the global economy. While we saw similar examples in the past, such as the Silk Road trade system and Indian Ocean trade network, today's phenomenon is truly a global system. It is considerably more extensive and most, if not all, economies on the planet are connected in some way.

Economic interdependence is a key feature of this system. While many countries and economic sectors have benefited, others have been adversely impacted. However, in the broader sense, the global economy has improved the standard of living for people in countries around the globe. International trade organizations such as the WTO have helped expand the global economy, but its growth and development have been propelled by communications technologies, such as the Internet and cell phone technology. The global economy shows no sign of declining. It is helping create a new global consumer and social culture that most of us are able to participate in and share.

Review Profile: World Trade Organization and Timeline: World Trade Organization.


Unit 10 Vocabulary

  • GATT
  • Protectionism
  • Social Market Economy
  • European Union
  • Globalization
  • Marshall Plan
  • Keynesian Economics
  • WTO