Stern School of Business
New York University
| B30.2390.10 | |
| Spring 2000 |
KMC 8-65, 998-0869 |
| T & Th, 5:30-6:50 |
Office Hrs: Tu 3-5 & by appt. |
| Tisch 201 |
email: rsylla@stern.nyu.edu |
Economic History of the U.S.
NOTE: THIS COURSE IS SIMILAR IN CONTENT TO B30.2336 "BUSINESS HISTORY OF THE
U.S." THEREFORE, A STUDENT MAY TAKE ONLY ONE OF THE TWO COURSES FOR CREDIT.
This course examines the historical development of the American economy from its small beginnings to the present. The focus is on long-term trends of the economy, including the growth of institutions and markets, industrialization, and the impact of governmental economic policies. The format is lecture (informal) with class discussions. Topics are arranged in rough chronological framework from colonial times to the present. See the course outline below.
Why would an MBA candidate consider taking such a course? She might say to herself, as an economist colleague once said to me, "Sylla, shouldn't we just let bygones be bygones?" One reason often given is that those who fail to learn from the mistakes of the past are condemned to repeat them. That has validity, but emphasizes too much the negative aspects of history. It fails to account, in the present context, for the economic optimism of Americans over the generations.
A better "MBA" reason is that economic history deals with how and why economic, business, and financial systems change over time, often abruptly, for economic and non-economic reasons. An appreciation of past change can, I think, aid in anticipating--or at least expecting--the changes that lie ahead, as well as how they might affect individuals, firms, industries, and the economy. That could be of some use during a several-decade career.
Also, an incredible range of economic experience characterizes American history: from hunting/gathering to agriculture to industry to the first post-industrial society; from unfree labor systems to a free labor market; a co-existence of backward regions and "cutting edge" regions; from disgruntled farmers and striking workers to "robber barons" conspicuously consuming wealth; from the depths of depression to the heights of prosperity. There are lessons for everyone, not just Americans. Indeed, it can be argued that American economic history is a microcosm of where the whole world has been and is going (examples: Europeans and others in our time are attempting to fashion the sort of larger, integrated political and economic entity that Americans created more than two centuries ago, and "globalization" in our time is perhaps an extension of how the US historically integrated its economy internally and with the rest of the world).
Finally, the history of the American economy on the whole is a "success" story: a country whose people two centuries ago numbered less than the current population of Brooklyn and Queens now, with but 4+% of world population, produces about a quarter of the world's output of goods and services. People from everywhere in the world came to participate in America's growth and development. How did all that happen? What were the ingredients of US economic success?
Course Readings are drawn mainly from two volumes, purchase of which is recommended. The first is Sidney Ratner, et al., Evolution of the American Economy, 2nd edition (Macmillan, 1993, now Prentice-Hall). This is a standard textbook with topical chapters organized within each of five chronological eras of U.S. economic history. For breadth, we shall read essentially all of it. For more depth, we turn to:
Alfred D. Chandler, Jr., Thomas McCraw, and Richard S. Tedlow, Management Past and Present: A Casebook on the History of American Business (South-Western College Publishing, 1996). It is a compilation of cases and case materials that the authors, leading business historians, have used in a highly popular course at the Harvard Business School. The cases are intensive studies of key issues, turning points, institutions, and individuals in American economic, business, and financial history. Plus a few supplementary articles; see syllabus.
Expectations. You are expected to do the assigned readings and to participate in class discussions. There will be (1) a Midterm Essay assignment due early March, and (2) a Final Essay assignment due at the start of the Spring semester exam period, May 1. The exams will be graded. A 12-page (3000 wds) paper on a mutually agreed topic in economic history (due May 1) can substitute for the final essay if one prefers to write a paper on a topic of special interest. Short (max. of 1 page) weekly writing assignments will also be given; these will not be graded, but each one not submitted adjusts one's final grade downward a mark, i.e., a B+ becomes a B if one is missed, etc. The assignments will be emailed to the class roster.
Course grades will be determined by the following weights: 50% on the midterm, 50% on the final essay or one's paper.
With twice weekly meetings, my plan is discuss with you the broad historical dimensions of a topic or era at the first class of the week, and then focus more in the second class on the related case or cases. I'll furnish you with a question or question to think about and respond to in each week's writing assignment. But you should also have your own questions, etc., about history and the historical materials. Raise them in class, for answers or opinions as the case may be.
Economic History of the U.S.
Outline and Readings
Economic history. The record of American economic growth. Colonial
economic development, 1607-1776. Ratner, Chs. 1, 2: America and the Developing World Economy; Regional
Patterns of Colonial Development. Economics of empire, revolution, confederation, and the Constitution. Ratner, Chs. 3, 4: Growth and Welfare in the Colonies; Foundations
of Economic Independence Public and private finance to 1860. Readings:
Ratner, Ch. 7: Critical changes in the financial system Transportation developments and land policies to 1860. Ratner, Chs. 5, 6 (133-141),: Revolutions in Transportation and
Communications; Land Policy.... Unfree labor: the economics of slavery; Economic progress to 1860. Ratner, Ch. 6 (141-55), 10: ...Agricultural Expansion and the
Political Economy of Slavery; Economic Growth and Social Welfare Railroads, management, and the rise of regulation after 1865. Ratner, Ch. 14: Building Nationwide Railroad and Communication
Networks The rise of big business. Ratner, Chs. 12, 13: Mass Production and the Advent of Big Business;
Labor in the Industrializing Society. The financial system in the "robber baron" era. Ratner, Chs. 15, 16: The Financial System Under Stress; National
and World Markets for Mass Production "The Progressive Era," World War I, and the 1920s. Ratner, Chs. 17, 18: The Economic Impact of World War I; The 1920s:
A Taste of Affluence. The Great Depression and the New Deal. Ratner, Chs. 19: The Great Depression and the Expanding Role of
Government World War II, postwar institutions and economic trends Ratner, Chs. 20, 21: The Planned Economy of World War II; The
Good Years, 1945-65. The economy and economic policy since the 1960s. Ratner, Chs. 22, 23: The Great Inflation, 1965-1982; Debts, Deficits,
and Defaults, 1980-1992
1/18,20
Readings:
Chandler, Case 1:Ben Franklin and the Definition of American Values.
1/25,27
Readings:
Chandler, Case 2: The Strategic Vision of Alexander Hamilton.
2/1,3
Chandler, Case 5: The Second Bank of the United States.
Sylla, "US Securities Markets and the Banking System, 1790-1840," Fed of St. Louis Review (May-June 1998). Handout.
2/8,10
Readings:
Chandler, Case 4: The Rise Of New York Port.
Case 7: The Coming of the Railroads.
2/15,17
Industrialization and commerce to 1860.
Readings:
Ratner, Chs. 8, 9: Beginnings of the Industrial Revolution in America; Growth and Change in Domestic and Foreign
Markets
Chandler, Case 6: Samuel Slater, Francis Cabot Lowell, and the Beginnings of the Factory System in the United States.
Case 19: Work:...Factory in 19th C. America, Document #s 2-7, pp. 4-40 to 4-51.
2/22,24
Readings:
Chandler, Case 18: Slavery.
2/29,3/2
Readings:
Chandler, Case 9: Jay Gould and the Coming of Railroad Consolidation.
Case 11: The Railroad Problem and the Solution.
3/7,9
Readings:
Chandler, Case 14: The Integration of Mass Production and Mass Distribution.
Case 15: The Standard Oil Company: Combination, Consolidation, and Integration.
Gavin Wright, "The origins of American industrial success, 1879-1940," American
Economic Review (Sept 1990), 651-68. [Accessible online:
Bobst, Bobcat, E-Journals and texts, JSTOR basic search, type in author, title, date, click on search, article.]
Spring Break
3/21,23
Readings:
Chandler, Case 10: J.P. Morgan, 1837-1913.
Richard Sylla, "Federal policy, banking market structure, and capital mobilization in the United States, 1863-1913,"
Journal of Economic History
(Dec. 1969), 657-86. [JSTOR]
Hugh Rockoff, "The `Wizard of Oz' as a monetary allegory," Journal
of Political Economy (Aug. 1990), 739-60. [JSTOR]
3/28,30
Readings:
Chandler, Case 23: Antitrust: Perceptions and Reality in Coping with Big Business
Case 26: Henry Ford and Alfred P. Sloan
4/4,6
Readings:
Chandler, Case 24: The New Deal and the Mixed Economy.
4/11,13
Readings:
Chandler, Case 25: The Federal Government and Employment.
4/18,20
Readings:
Chandler, Case 27: Michael Milken.
Case 30: The Communications Revolution [Dated after 5 years?!]
4/25,27
The 1990s expansion in historical perspective. Summary of course:
looking back, now, and ahead--a third "American century?"