Politics and American Capitalism
Political Science 340
Spring 2007
Mon – Fri:
Room 257
Class Overview: The appropriate role of
government in the American economy has long been a subject of academic and
political debate. For the past half century, the American, as well as the
world’s economies, has progressively turned away from state management of the
economy in favor of markets. In this course we will explore this historical
trend as well as examine the connections between
economics and domestic politics, paying close attention to the role of fiscal
and monetary policy. This course will also explore the major thinkers in
political economy (Adam Smith, John Keynes, F.A Hayek) as well as the major
“schools of thought” such as Keynesianism, Public Choice, Corporatism, and
Monetarism. Whereas economics is the
study of individual choice, political economy is the study of collective
choice; specifically, how does a society decide who gets what, and how much.
Therefore, the study of political economy examines the ways in which
public policies and institutions shape economic performance and the
distribution of income and economic power.
Required Texts:
The Road to Serfdom (F.A. Hayek)
New Ideas from Dead Economists (Buchholz)
Politics and the American Economy (Gosling)
Class Reader
Graded Assignments:
(2) Quizzes (50 pts each) 100 pts
(5) Two page book/article reviews (20 pts each) 100 pts
Final Exam 75 pts (Or Service Learning Project—Not an option in 2007)
Attendance/participation 50 pts
Total Points 325 pts
90% or higher = A, 89%-80% = B, 79%-70% = C, 69%-60% = D, 59% and lower = F
Extra Credit: You may do up to three
additional Book/Article reviews for 10 points each.
Weekly Syllabus (Subject to change):
Week Material
1. What is political economy? Buchholz: The Second Coming of Adam Smith (Review Required)
Different economic systems
What is the role of government? Gosling: Chapter 1
What is a market?
Supply and Demand games Reader: Growth and Welfare
Price Floors and Ceilings game
2. The rise of Keynesianism Buchholz: Keynes: Bon Vivant as Savior
Aggregate Supply and Demand models
Macroeconomic models Buchholz: The Monetarists Battle with Keynes (Review Required)
Productivity: The neo-luddites (Myrdal).
Political Business Cycle
The Supply Sider Revolt (Laffer curve) Gosling: Chapter 2
Non-political Monetary policy
3. F.Y. Hayek and The Road to Serfdom The Road to Serfdom
Info costs projects (The marriage project)
Handouts
QUIZ # 1
4. The Public Choice School Buchholz: The
Prisoner’s Dilemma
Diffused Costs and Concentrated Benefits Gosling: Chapter 3 (Review Required)
Rent Seeking (Stossel #3)
Property Rights (Stossel #1) Reader: Beyond Politics
The Rise and Decline of Nations
5. “Messing with the Market”: The Regulatory State
Taxation policies/Laffer Curve/German Disease
Social Security Reform Gosling: Chapter 5
How Subsidies Distort Markets (Stossel #5)
Cartel Game
Feedback loops: mortgage deductions, lawsuits. Reader: Samuelson Essays
Creative Destruction (Schumpater): Regulation
Soc.Sec Privatization
6. Corporatism Reader: Germany’s Disease
Wagner
Act
The Decline of
Unions and Taft Hartly
PATCO firing by Reagan
7. Flexibility Week
QUIZ # 2
8. Commanding Heights (video) Reader: Commanding Heights (Review Required)
9. Commanding Heights (lecture)
Monopolies, Incentives, and Info Costs
10. International Trade and Globalization Buchholz: David Ricardo and the Cry for Free Trade
Concentrated pains, diffused benefits
Outsourcing Bogyman (Stossel #4) Gosling: Chapter 4
Tariffs, Quotas, and Ricardo
Consumption = Production Reader: Outsourcing essays (Review Required)
FINAL EXAM: Take home
exam due Wed, June 6th,