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Smith: Three functions of the Gov’t |
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Definition
1. Providing law and order 2. Defense (is much more important then opulence) - Does not oppose the navigation acts- thinks they have a role in the navy 3. Construction of essential public works. There’s insufficient incentive |
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| Tariff and Tax Impact on the Colonies |
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Definition
-Increased demand for colonial ships - Limits on shipping of enumerated goods led to higher expenses of longer voyages, port fees, warehousing costs. (burdon on british colonies) - Colonists as consumers paid more for colonial imports from Europe (about 20% of total colonial imports) As producers they received less Benefits to British middlemen. -Lower prices for tobacco received by coloists.- colonists wouldn’t sell as much to the Europeans (burdon) - Higher prices paid by Europeans. - Independence would mean ability to export directly to European markets. - Stamp Act, Tea Act- would have to pay a tax to the british empire on stamps and tea |
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| Only way to increase wages fund is to ... |
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Definition
| ...to increase profits.
Accumulated capital (savings) makes it possible to advance wages, materials to workers.
High wages will accompany economic growth |
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| Low wages are symptomatic of.... |
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Definition
a stationary or contracting economy |
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- Court physician for louis the 14 and his mistress
- Believed that Artisans, manufacturers, traders- do not generate a produit net. Steril Class.
Physiocracy
- Industries are productive if they produce more then they consume.
- Manufacturers do not do this.- they just rearrange the form of goods. Gov’t should not intervene.- Agriculture alone creates net product.- Proprietors- the landlords. The farmers lease or rent land from them. Proprietors are not productive either |
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TURGOT and the ENTRERENEUR |
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Definition
- Moving away from agricultureal feudalism - Key role of the entrepreneur in movement to capitalism- The farmer becomes an innovator/ capitalist. - Finance Minister who ordered freedom of internal grain trade. - Abolished guilds - Aroused opposition of tax farmers - Taxes on the landlord- a single tax on the net product |
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Says that East india trade is a blessing for England. Foreign trade is profitable for England. What are the benefits?- There is a benefit even from running a trade deficit from India (not a deficit for all trade.) Believed that it helped find new markets
As wages rise higher, workers take more leisure time. The Mercantilist want a hard working labor force, so lower wages were good. |
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finance minister for Louis the 14th
Colbert always under pressure to raise money - Raises taxes Ansian Regime (sp?) - Roman Catholic church very important and characterizes Ansian Regime. Wealth passed down by inheritance, Vernality is the sale of office (the right to be a tax farmer) - King farms out the right to college taxes. Tax farmer pays up front then gouges people for money. - Corvee tax- Tax of forced labor for the gov’t. - Taille- tax on farm produce (Colbert would raise the taille putting a heavier burden on French farmers- make exceptions for the nobility and clerics) Tax put on farmers, craftsmen. o This slowed the growth of the French capital stock. o Slowed capital formation in france o Had much less to reinvest |
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- Magistrate who rejected mercantilist views on wealth. o Emphasized the primacy of agriculture
- Looking at the decline of the French economy. - Advocates higher grain prices - Attacking mercanitilism - Attacked the French tax system. - Lassai Faire- let the natural order go- it will run itself
- It was a regressive tax |
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