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A Comparative Study
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Economic Systems
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IMPERIALISM
A
FINE
ART
OF
CONQUERING
THE
WORLD

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Late 19
th
century expansion is where
Imperialism begins
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Introduction to Imperialism
A national policy of conquest of other regions or people
for the purpose of extending political and economic
control and exploiting the resources of other regions or
people.
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Background
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As other Empires weakened, European
states expanded.
Industrialization gave them the tools to
expand.
Trade connections gave them
information about the rest of the world.
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Effects of Imperialism
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Trade encouraged between dominant
states and their colonies.
Migrations of people based on labor
needs and opportunities.
Modern racism developed.
Development of nationalism in colonial
lands.
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Main Motives of Imperialism
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Colonies served as a supplier of raw
materials.

A market for manufactured goods.

An outlet for surplus population.
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Political Motives
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Colonies Provided
Strategic sites on trade routes.
Harbors to supply naval ships.
To gain advantages and withhold from
rivals.
Domestic pride in imperialist success.
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The Tools of Imperialism
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Based on European technical
advantages such as:
Transportation: railroads, steam ships.
Military technology: rifled gun barrels,
breech-loading machine guns.
Communications: telegraph.
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European Imperialism
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The British in India
Decline of Mughal state in India allowed
the British East India Company to
expand its influence.
By the 1750s, it won the right to rule
from local authorities and Mughal
emperors.
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The Transformation of India
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Encouraged export crops of tea, coffee,
and opium
Constructed transportation and
communications infrastructure.
English schools taught British culture.
Suppressed Indian customs that
conflicted with western values,
especially the sati.
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In India
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Raw cotton went for export rather
than local use.
Railroads aided this process.
Indian textile producers lost out.
New crops also introduced to meet
European demand, tea, lumber, rubber,
etc. Opium was planted in India to
export to China.
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The Scramble for Africa
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Before 1878, Africa was mostly free of
European domination.
Missionaries and adventurers explored
the interior of Africa.
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European Claims in Africa
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The Legacies of Imperialism
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Empire and Economy
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Colonies were built up as suppliers
of natural resources.
Mines and agriculture built up.
Most of the benefits went to the
colonial powers.
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New Imperialism: The political and economic control of
one country by another.
A type of foreign
policy practiced
by
European nations
and Japan
throughout the
1800s and early
1900s.
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PLACE TO INVEST PROFITS.
NEW WEAPONS.
SPIRIT FOR NATIONALISM.
NEED FOR NEW MARKETS.
BASES FOR TRADE AND NAVY SHIPS.
POWER AND SECURITY OF GOBAL
EMPIRE.
IMPROVED SHIPS AND RAILROADS.
NEED FOR NATURAL RESOURCES.
WISH TO SPREAD CHRISTIANITY.

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POSITIVE
NEGATIVE
New roads & railroads link
parts of India
Telegraph & postal systems
unite people
Irrigation systems improve
farming
New laws mean justice for all
classes
British schools offer education
Customs that threaten human
rights are ended
Indian resources go to
Britain
British made goods
replace local goods
Farms grow cash crops
rather than food crops;
Indians go hungry
Top jobs go to British
Indians are treated as
inferiors
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POSITIVE NEGATIVE
European medicine & improved
nutrition increased life span of
Africans. This caused an increase
in population.
Modern transportation &
communications; telegraphs,
railroads, steamships, and
telephones
A small minority received
improved education and
economic opportunities.
European domination led
to an erosion of traditional
African values and
destroyed many existing
social relationships
African peoples were
treated a s inferior.
Forced to work long
hours for low pay.
Europeans divided up Africa
ignoring tribal, ethnic, and
cultural boundaries.
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Conclusion on Imperialism
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European influence came from wealth
and economic power.
Imperialism had large influence on
colonies.
Shaped economies and societies.
Created multicultural societies.
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Socialism and Communism
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Socialism defined
Text: An ideology arguing that citizens are best
served by policies focused on meeting the basic
needs of the entire society rather than on serving
the needs of individuals as individuals.
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1800 1 ton of coal 50, 000 miners
1850 30 tons 200, 000 miners
1880 300 million tons 500, 000 miners
1914 250 million tons 1.2 million miners
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1813 2400 looms 150, 000 workers
1833 85, 000 looms 200, 000 workers
1850 224, 000 looms >1 million workers
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Socialism Emergence

Modern socialism originated in the late 19
th
century, as
a working class political movement as well as a
movement that criticized the effects of industrialization
on society.

Liberal political parties in 19
th
century Europe failed to
address the desperate needs of working people.

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Socialisms emergence

Term socialism coined in 1827 by British
socialist Robert Owen, also viewed socialism as a
matter of ethics, though he used it with a slightly
more specific meaning, to refer that human
society can and should be improved for the
benefit of all.


Socialism provides a different conception of
individual responsibility & of government.
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A brief View On the Various types of
Socialism
Marxism and Communism
Libertarian socialism and Social anarchism
Democratic socialism and social democracy
Religious socialism
Regional or ethnic socialism
Eco-socialism

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A map of countries (using present-day borders) that have
constitutionally declared themselves to be "socialist", under any
definition of the term, at some point in their history. They are
color-coded for the duration of their claims to be socialist
Socialist Countries
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Social democracy
A variation on socialism that argues that socialism
and democracy can work together.

Change comes through peaceful democratic
processes like elections.

Democratic governments should promote
economic - as well as political - freedom &
equality.
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Social democracy
Socialist political parties compete and win
office in every western democracy except the
United States.
Why might this be so? Whats different about
the U.S.?
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Democratic Socialists of America speak:
Democratic Socialists believe that both the
economy and society should be run
democraticallyto meet public needs, not just
to make profits for a few. Many structures of
our government and economy must be
radically transformed. So that ordinary
Americans can participate in the many
decisions that affect our lives.
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Social democracys similarities
with Marxism
These economic conditions have adverse effects
on ordinary working people in terms of physical
health, psychological well-being, housing,
education, etc.

Both ask the question:
Why should those who provide the money
(capital) receive all the profits, and those who
provide the labor receive none of the profits?
:It is labor, after all, that turns raw materials
(including cash) into something with greater
value.

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Communism

Communism is based on the concept of shared effort and
shared resources. No existent nation practices pure
communism, and no self-sustaining country that uses
communism as a basis for their economy.
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The main communist theories include:

MARXISM

LENINISM

TROTSKISM

STALINISM

MAOISM
Marxist School Of Communism
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Properties of Communism

All members of the economy share both work and
benefits.
Those that do not provide their share of effort and
resources to the system are culled.
Successful communistic systems tend to be small
and homogeneous.
A healthy communistic system results in a
cooperative society.

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Communist Revolution Inevitable


Capitalism creates huge factories. Workers
become concentrated and begin to organize for
legal reforms (higher wages/better working
conditions). Their effort fails.

Fierce competition between capitalists leads to
new technologies, which leads to lower costs.

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Communist Revolution Inevitable
In the competition, some capitalists go bankrupt &
have to become workers, and many workers lose
their jobs as new technology replaces them.
Greater numbers of people permanently
unemployed. Misery widespread.
Fewer people can afford the products of
capitalists, so fewer companies survive.

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Communist Countries
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Advantages of Communism
Communism is an internally stable economic system,
in that those that participate benefit and those that
don't are culled - creating an incentive to participate.

Communism requires common goals and agreed
upon rules/laws to allocate responsibilities and
resources. If successful, this leads to a spirit of
sharing - which builds stronger social communities,
creating a more stable economy.

Due to their sense of cooperation, healthy
communistic systems are very efficient at distributing
resources within their localized areas - particularly in
times of need.
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Disadvantages of Communism
Large or geographically broad populations tend to be
diverse, making it difficult to maintain a common goal or
set of rules for shared effort and resources.

Large, diversified societies tend to gravitate towards
systems of hierarchy, reducing the perception of fair
distribution of work and resources - which can destabilize
a communistic society.

Allowing an influx external culture increases the
likelihood of destabilizing the homogeneity of the society.
As such, communistic systems tend to block out external
cultures and exclude outside competition, weakening the
system's ability to learn from, or compete with, external
economies.
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Capitalism: Ideology & Assessment
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Capitalism:
Capitalism is based on the Darwinian concept of
survival of the
fittest.

While being aware that no nation that practices a pure
form of
this economic system, several Western countries use a
form of
capitalism at the core of their economies.

A Capitalist economy is an economic system in which
the production and distribution of commodities take
place by private organizations.

It is also called as market economy or free trade
economy.
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What capitalism looks into:

Right to Private Property
Profit-Motive
Freedom of Choice
Market Forces
Minimal role of Government

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Capitalist Ideology

Limited Role for Government
Self-Interest
Free Trade
Competition
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Self-Interest
All about ones gains, ones own way to bring in profits.
Greed, theft, criminality have given self-interest a bad name. Our
home country comes to mind, unfortunately.
Key ingredient is the notion that people can be trusted to pursue
their self-interest better than committees, governments


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Limited Role for Government
National Defense
Police, Justice
System
Legal Framework to
Economic Activity
Newer Spheres:
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Capitalist Institutions


Markets
Private Property
Private Enterprise
Rule of Law
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Capitalism Reconsidered
Criticisms of Capitalism
Greed a problem
Poverty up under capitalism
Criticisms of Free Trade
Big countries exploit smaller ones
Small countries invaded by
ruthless multinational

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Advantages of Private Ownership
Cost efficiency and quality
Entrepreneurship/ Innovation/Progress
Productivity/Productivity Growth
Employment and Wages
Consumer orientation / Competition
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Advantages of Govt. Ownership

Improved industrial climate
Employment is higher
Redistribution of wealth
People understand that life is not fair - there's no
"free lunch".
Natural monopoly (e.g. utilities)
Restructuring and Privatisation in the Public
Utilities
Public Interest
i.e. public companies do not focus on profit
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Disadvantages of Private Ownership
Inefficient Performance

Corporate Governance

Monopoly/Oligopoly
Those in power tend to construct rules that limit diversity and
competition, thereby weakening the flexibility and strength of
the system as a whole.

Institutional Investors

Poor Work Ethic

Financial Security

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Disadvantages of Govt.
Ownership

Cost Inefficiency
Poor Quality
Lack of Innovation
Consumer Choice
Employee Incentives
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Disadvantages of Govt.
Ownership contd.

Reduced Productivity
Reduced Economic Growth rates (banks)
Agency problem
By the people, for the bureaucrats
Diversion of Resources
For political gain
Corruption and bribes
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Comparisons: Capitalism vs.
Communism vs. Socialism
Socialism provides everyone & brings into a
creative exploration.
However, since external forces and internal
disasters exist, socialism is unsuitable as the
principal basis for a long-term economy.
A common goal and belief system which
communism provides to all participants with a
fair share of the workload and resources.
This works well for small communities,
particularly for non-diversified societies.
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Diversity makes communism unsuitable as a
core economy for most modern nations.

Capitalism considered a more inherently
stable economic system

Capitalism benefits from diversity and external
competition.
A healthy capitalistic economy also provides
built-in incentives to it's members to increase
their economic participation in the system.


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Diversity of cultures and methods.

Open competition and free trade.

Bringing A Change: A system that describes
an economy based principally on capitalism,
but with added aspects of socialism when
resources are plentiful, and aspects of
communism when the need arises.

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Summary
Choice of economic
systems matters
None are pure but
incorporate from
others
Countries where
most people are
happy enough with
results are few!!!
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