Commerce Inventions

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Complete list of all inventions linked to commerce technologies (Victoria:Revolutions v2.01) Prerequisite inventions are shown in green.


Contents

Multitude of Financial Instruments

The introduction of a multitude of financial instruments, meant not only a smoother flow of capital, but also that the middle class got better return on their private investments.

  • ID: 300
  • Prerequisite Techs/ Inventions: Stock Exchange
  • Years: 1850 - 1920
  • Effects:
    Tax efficiency: +1%
    Education costs: +0.5%
    Crime fighting costs: +0.5%

Insurance Companies

The creation of companies selling insurances made business simpler and safer. Also families took advantage of new intellectual products as home insurances etc.

  • ID: 301
  • Prerequisite Techs/ Inventions: Stock Exchange
  • Years: 1850 - 1920
  • Effects:
    Tax efficiency: +1%
    Education costs: +0.5%
    Crime fighting costs: +0.5%

Regulated Buying and Selling of Stocks

This made it not only safer, but also cheaper in the long run to by stocks as the routine for buying and selling was now institutionalized into time and place.

  • ID: 302
  • Prerequisite Techs/ Inventions: Stock Exchange
  • Years: 1850 - 1920
  • Effects:
    Tax efficiency: +1%
    Education costs: +0.5%
    Crime fighting costs: +0.5%

Liquidation of Assets

This meant that a bankupted firm got its assets sold to pay of the moneylenders. This was a complex but important set of laws that was the first step to a stable juristiction for bankruptcies.

  • ID: 303
  • Prerequisite Techs/ Inventions: Business Banks
  • Years: 1860 - 1920
  • Effects:
    +25% Chance for event "Private Initiative" (#23071; gain random factory)

Capital for Investors

At this point market behaviour had been directed and demand for capital had been focused so that a market for capital had been created.

  • ID: 304
  • Prerequisite Techs/ Inventions: Business Banks
  • Years: 1860 - 1920
  • Effects:
    +25% Chance for event "Private Initiative" (#23071; gain random factory)

Distribution Channels

As the line for resource to finished value-added product became longer from specialization channels of distribution opened as some companies specialized in distribution to shops. This made the supply side more effective.

  • ID: 305
  • Prerequisite Techs/ Inventions: Business Banks
  • Years: 1860 - 1920
  • Effects:
    +25% Chance for event "Private Initiative" (#23071; gain random factory)

Industrial R&D Investments

At this point business starts to make long range production more efficient by investing in the research of new tools and products.

  • ID: 306
  • Prerequisite Techs/ Inventions: Investment Banks
  • Years: 1880 - 1920
  • Effects:
    +25% Chance for event "Private Initiative" (#23071; gain random factory)

Industrial Production Investments

At this point business starts to make long range production more efficient by investing in new plants and buying low echelon suppliers of parts.

  • ID: 307
  • Prerequisite Techs/ Inventions: Investment Banks
  • Years: 1880 - 1920
  • Effects:
    +25% Chance for event "Private Initiative" (#23071; gain random factory)

Industrial Distribution Investments

At this point business starts to make long range production more efficient by buying their way into the distribution channel.

  • ID: 308
  • Prerequisite Techs/ Inventions: Investment Banks
  • Years: 1880 - 1920
  • Effects:
    +25% Chance for event "Private Initiative" (#23071; gain random factory)

Private Bank Monitoring

By instituting a seperate agency for monitoring the behaviour of private banks the government had a chance to stop bank crashes and also to refrain banks from fraud.

  • ID: 309
  • Prerequisite Techs/ Inventions: Bank Inspection Board
  • Years: 1895 - 1920
  • Effects:
    Tax efficiency: +1%
    Education costs: +0.5%
    Crime fighting costs: +0.5%
    -51% Chance for event "Bank Sector Crash" (#23001, 5% of aristocrats and capitalists convert to clerks; -2 CON for ar./cap.)


Market Behaviour Monitoring

By instituting a seperate agency for monitoring the behaviour of actors on the market the government had a chance to stop firms from crashing and also to refrain them from fraud.

  • ID: 310
  • Prerequisite Techs/ Inventions: Bank Inspection Board
  • Years: 1895 - 1920
  • Effects:
    Tax efficiency: +1%
    Education costs: +0.5%
    Crime fighting costs: +0.5%
    -51% Chance for event "Bank Sector Crash" (#23001, 5% of aristocrats and capitalists convert to clerks; -2 CON for ar./cap.)

Silver Standard

This meant a currency system based on silver. Money was cheaper to produce by the government which meant that it was rarely any lack of money in the country. The problem was though that the silver prices had a tendency to be dominated by gold prices which meant that foreign trade was often suffering.

  • ID: 311
  • Prerequisite Techs/ Inventions: Ad-Hoc Money Bill Printing
  • Years: 1850 - 1920
  • Effects:
    Tax efficiency: +3%
    Tariff efficiency: +2%
    Education costs: +2.5%
    Crime fighting costs: +2.5%

Decimal Monetary System

By abolishing non standardized and strange divisions of the currency, like guineas and shillings etc and only having a decimal system like for example the system in the United States (1 US Dollar = 100 cent). The everyday usage of money was simplified.

  • ID: 312
  • Prerequisite Techs/ Inventions: Ad-Hoc Money Bill Printing
  • Years: 1850 - 1920
  • Effects:
    Tax efficiency: +3%
    Tariff efficiency: +2%
    Education costs: +2.5%
    Crime fighting costs: +2.5%

Double Standard

This meant a currency system where both gold and silver ran as parallel monetary units. It ensured the state always to be able to produce cheap money, but the difference in price changes between the currencies could have grave effect for the individual citizen.

Fixed Intramonetary Exchange Rates

This meant a system of comparing prices of different currencies, and a simplified syste of buying and selling them. This improved the efficiency of foreign trade enormously.

  • ID: 314
  • Prerequisite Techs/ Inventions: Private Bank Money Bill Printing
  • Years: 1860 - 1920
  • Effects:
    Tax efficiency: +1%
    Tariff efficiency: +2%
    Education costs: +1.5%
    Crime fighting costs: +1.5%
    Loan repayment efficiency: +5%

Gold Standard

This meant a currency system based on gold. Money was rather expensive to produce by the government and this could sometimes result in a low of money stock. However, the good thing was that the gold prices was rather stable and the trust in gold was high and made the currency stable.

International Monetary Exchange Rates

This meant a system of comparing prices of different currencies, and a simplified syste of buying and selling them. This improved the efficiency of foreign trade enormously.

State Bond Monetary Mechanism

By a regulating a sound state bond system the government could lend money internally and get control of currency flows. This was one important measure to get a stable monetary system.

  • ID: 317
  • Prerequisite Techs/ Inventions: Modern Central Bank System
  • Years: 1895 - 1920
  • Effects:
    Tax efficiency: +1%
    Tariff efficiency: +2%
    Education costs: +1.5%
    Crime fighting costs: +1.5%
    Loan interest rate: -2%

Interest-Inflation Weapon

By letting the National Bank changing the interest rate the government could, at least to an extent, balance inflation against unemployment.

John Elliot Cairnes

John Elliot Cairnes was a follower of John Stuart Mill. His Slave Power (1862), a defense of the North in the American Civil War, made a great impression in England. He has written about noncompeting groups in the labor market and is known for his distrust of mathematical economics. Among his works are The Character and Logical Method of Political Economy (1857) and Some Leading Principles of Political Economy Newly Expounded (1874).

  • ID: 319
  • Prerequisite Techs/ Inventions: Late Classical Theory
  • Years: 1850 - 1920
  • Effects:
    Prestige: +1
    Events enabled: "Labor Competition" (#23013-18)

Robert Torrens

Robert Torrens was a British army officer and owner of the influential Globe newspaper. Torrens was an independent discoverer of the Ricardo's principle of 'comparative advantage' in international trade (albeit a promoter of 'reciprocal tariffs', rather than unilateral free trade). Torrens was also a co-discoverer of the Ricardian theory of 'differential rent', although, in later editions, recanted the Malthusian population doctrine on which it was partly based. Torrens remained a consistent critic of the 'labor theory of value'.

  • ID: 320
  • Prerequisite Techs/ Inventions: Late Classical Theory
  • Years: 1850 - 1920
  • Effects:
    Prestige: +1
    Events enabled: "Market Efficiency" (#23019), "Market Imperfections" (#23020)

John Ramsay McCulloch

A prolific Scottish journalist, John Ramsay McCulloch was one of the most ardent and doctrinaire expositors of the Classical Ricardian School. McCulloch began his career as the editor of The Scotsman, eventually moving on to the whiggish Edinburgh Review, where he served as economics editor until the late 1830s. McCulloch used his position at the Review to popularize the Classical theories and promote his favorite economic policies, such as the repeal of the Corn Laws, the retention of the Poor Laws and the legalization of trade unions. McCulloch also lectured on political economy at University College London from 1828 to 1832. In 1838, he was appointed the Comptroller of HM Stationary Office. McCulloch's main work, Principles (1825), was perhaps the first successful 'serious' textbook in economics (and a rather loyal reading of Ricardo's theory). However, McCulloch is often considered a 'lightweight' in terms of the development of economic theory. His main contribution was the ill-fated 'wages fund' doctrine (1824, 1825, 1826). McCulloch was also the editor of the 1828 edition of Adam Smith's Wealth of Nations and the 1846 edition of David Ricardo's Works. He also composed some of the earliest accounts of the history of economic thought (naturally, flattering to the Ricardians). His monumental 1837 treatise provides a statistical account of the failure of the Malthusian population doctrine.

  • ID: 321
  • Prerequisite Techs/ Inventions: Late Classical Theory
  • Years: 1850 - 1920
  • Effects:
    Prestige: +1
    Events enabled: "Popularization of Economics" (#23021-23)

Nassau William Sr.

The works of this economist has been printed and distributed in your country. When the academics have debated and refined their dialogue its merits will soon be known by large segments of your population. At this point it will produce changed economic behaviour and procedures in your country.

  • ID: 322
  • Prerequisite Techs/ Inventions: Late Classical Theory
  • Years: 1850 - 1920
  • Effects:
    Prestige: +1
    Events enabled: "Production-based Supply Scheme is (not) present" (#23024-25)

James Mill

James Mill was a radical thinker that worked in the shadows of the brilliant, Jeremy Bentham. Together this two men can be described as the inventors of Utilitarianism, and much of its general applicability was explained in Mills works, Elements of Political Economy (1821) and Analysis of the Phenomenon of the Human Mind (1829).

  • ID: 323
  • Prerequisite Techs/ Inventions: Late Classical Theory
  • Years: 1850 - 1920
  • Effects:
    Prestige: +1
    Events enabled: "Commerce Defended" (#23026), "Agribusiness Defended" (#23027)

John Stuart Mill

John Stuart Mill was the son of James Mill, the famous utilitarian, he quickly became known as one of the more brilliant minds of the United Kingdom, and also one of the more radical. He published several book among them, A System of Logic (1843), Principles of Political Economy (1848), On Liberty (1859), Considerations on Representative Government (1861) and Utilitarianism (1861), all of which made him the centre-figure of socialliberalism and a more humane view of society.

  • ID: 324
  • Prerequisite Techs/ Inventions: Late Classical Theory
  • Years: 1850 - 1920
  • Effects:
    Prestige: +1
    Events enabled: "Stationary State" (#23028), "Humane Economy" (#23029)

Pierre Joseph Proudhon

Proudhon was apprenticed as a printer and became interested in politics after he was involved in the printing of The New Industrial and Cooperative World by Charles Fourier. Proudhon now turned to writing and in 1843 published What is Property? In the book Proudhon attacks the injustices of inequality and coined the phrase, 'property is theft'. Proudhon published his most important work, System of Economic Contradictions, was published in 1846. Karl Marx responded to Proudhon's book by writing The Poverty of Philosophy (1847). This was the beginning of the long-term struggle of ideas between the two men. Proudhon was opposed to Marx's authoritarianism and his main influence was on the libertarian socialist movement.

  • ID: 325
  • Prerequisite Techs/ Inventions: Collectivist Theory
  • Years: 1860 - 1920
  • Effects:
    Prestige: +1
    Events enabled: "Urban Worker Organization" (#23030), "Landless Peasant Organization" (#23031)

Karl Marx

Karl Marx was originally disciple of Hegel, but evolved his idealistic philosophy. Later in Paris he began mixing with members of the working class for the first time. Marx was shocked by their poverty but impressed by their sense of comradeship. In an article that he wrote for the Franco-German Annals, Marx applied Hegel's dialectic theory to what he had observed in Paris. Marx, who now described himself as a communist, argued that the working class (the proletariat), would eventually be the emancipators of society. Marx' most influential works were: The German Ideology, The Communist Manifesto, Principles of Communism, and "Das Kapital". For most of his life he lived in England where he published his works and from where he bacame the most influential socialist of all time.

  • ID: 326
  • Prerequisite Techs/ Inventions: Collectivist Theory
  • Years: 1860 - 1920
  • Effects:
    Prestige: +1
    Events enabled: "The Incumbent Self-destruction of Capitalism" (#23032), "Marxist Financial Doctrine" (#23033-34)

Friedrich Engels

As a young man Engels went to Manchester to help his father manage his cotton-factory. Engels was shocked by the poverty in the city and began writing an account that was published as Condition of the Working Classes in England (1844). Here Engels met Marx with whom he would write and try to organize the international worker organizations for the rest of his life. Engels lived in the shadows of Marx' intellectually, but economically he financed Marx so that he could write. Basically there wouldn't have been a Marx without a Engls and vice versa.

  • ID: 327
  • Prerequisite Techs/ Inventions: Collectivist Theory, Karl Marx
  • Years: 1860 - 1920
  • Effects:
    Prestige: +1
    Events enabled: "Dogmatic Worker Self-appraisal" (#23035), "Marxist Industrial Revolution" (#23036-37)

Eduard Bernstein

Eduard Bernstein was originally a staunch disciple of Marx and started his life in the German Socialdemocratic Party, but during his later exile in London Bernstein gradually became convinced that the best way to obtain socialism in an industrialized country was through trade union activity and parliamentary politics. He published a series of articles where he argued that the predictions made by Karl Marx about the development of capitalism had not come true. He pointed out that the real wages of workers had risen and the polarization of classes between an oppressed proletariat and capitalist, had not materialized. Nor had capital become concentrated in fewer hands. Bernstein's revisionist views appeared in his extremely influential book Evolutionary Socialism (1899).

  • ID: 328
  • Prerequisite Techs/ Inventions: Collectivist Theory, Friedrich Engels
  • Years: 1892 - 1920
  • Effects:
    Prestige: +1
    Events enabled: "Pragmatic Socialist Economics" (#23038), "Economy" (#23029)

Sidney Webb

Webb developed socialist ideas while at university and in 1885 he joined the Fabian Society. The society believed that capitalism had created an unjust and inefficient society. The members agreed that the ultimate aim of the group should be to reconstruct 'society in accordance with the highest moral possibilities'. The Fabian Society was a 'fact-finding and fact-dispensing body' and it produced a series of pamphlets on a wide variety of different social issues. Many of these were written by Sidney Webb including Facts for Socialists (1887), Facts for Londoners (1888) and The Eight Hour Day (1891). Webb also wrote A Plan on Campaign for Labour with George Bernard Shaw. Webb later became an important socialdemocratic figure with influence in the international worker organizations.

Karl Kautsky

Karl Kautsky joined the Social Democrat Party (SDP) and was responsible for drafting the Erfurt Program which committed the SDP to an evolutionary form of Marxism. He also wrote and published The Economic Doctrines of Karl Marx (1887) and Thomas Moore and His Utopia (1888). After a while he broke with Bernstein, whom he viewed to lenient and instead stayed true to his more revolutionary view of socialism.

  • ID: 330
  • Prerequisite Techs/ Inventions: Collectivist Theory, Friedrich Engels
  • Years: 1897 - 1920
  • Effects:
    Prestige: +1
    Events enabled: "Popularization of Socialist Economics" (#23040), "Marxist Dogmatic Income Policy" (#23041-42)

Jean Jaurès

Jaurés was elected to the Chamber of Deputies in 1885. Defeated in the 1889 elections he returned to the University of Toulouse. He became increasingly radical in his political views and after reading Karl Marx he began advocating socialism. He was not a revolutionary and supported the Independent Socialists. While out of parliament Jaurés completed his mammoth Socialist History of the French Revolution. He also joined with Aristide Briand and Rene Viviani in 1904 to establish the left-wing newspaper, L'Humanité in 1904. A new Socialist Party under Jaurés grew rapidly at the beginning of the century but split over the correct response to German militarism. Jaurés advocated a policy of international arbitration whereas others supported the Triple Entente.

  • ID: 331
  • Prerequisite Techs/ Inventions: Collectivist Theory
  • Years: 1895 - 1920
  • Effects:
    Prestige: +1
    Events enabled: "Alternative Socialist Economics" (#23043)

Friedrich List

Friedrich List was a nationalist and romantic critic of economic theory and one of the forefathers of the German Historical School. His best-known work, The National System of Political Economy (1841) was written as against the free-trade doctrines that permeated Classical economics. However, his was not a polemical defense of protectionism. He argued it on the basis of his analysis of economics, which stressed political factors - notably, the 'nation' - in economics. List argued that it was the government's responsibility to foster the 'productive powers' of a nation and, once these were in place, then free trade could ensue, but not before. This is akin to the modern 'infant industry' argument for protection. More relevantly, he devloped a theory of economic 'stages' which was to serve as a blueprint for the German Historical School.

  • ID: 332
  • Prerequisite Techs/ Inventions: The Historical Theory
  • Years: 1885 - 1920
  • Effects:
    Prestige: +1
    Events enabled: "Infant Development Policy" (#23044)

Wilhelm Roscher

A professor at the University of Leipzig (1848-94), he was a founder of the German historical school of economics, which rejected the classical laissez-faire view. Roscher's work emphasized the developmental character of capitalism through detailed historical analyses of the cultures of ancient nations. His "System der Volkswirtschaft" (5 vol., 1854-94, tr. of 13th ed., Principles of Political Economy, 1878) was an influential textbook in the second half of the 19th century. His most significant work is "Geschichte der National-Ökonomik in Deutschland" (1874).

  • ID: 333
  • Prerequisite Techs/ Inventions: The Historical Theory
  • Years: 1885 - 1920
  • Effects:
    Prestige: +1
    Events enabled: "Business Cycle - Depression" (#23045), "Business Cycle - Expression" (#23046)

Bruno Hildebrand

Highly critical of Classical theory, Hildebrand spent much of his time attacking Ricardo relentlessly for being materialistic, universalistic and cosmopolitan. Only later in his life did he put his own idea down - in particular, developing a linear 'stages' theory of economic history. His empirical and statistical work, however, did not make much use of these insights.

  • ID: 334
  • Prerequisite Techs/ Inventions: The Historical Theory
  • Years: 1885 - 1920
  • Effects:
    Prestige: +1
    Events enabled: "Linear Evolution" (#23047)

Karl Knies

Knies's linear stages argument spoke of 'moral progress' which would render most theories obsolete. His 1873 work, however, contained little of the historical method in it. His political involvements earned him temporary exile in 1848. He wrote Political Economy from the Standpoint of the Historical Method (1853), and Money and Credit (1873).

  • ID: 335
  • Prerequisite Techs/ Inventions: The Historical Theory
  • Years: 1885 - 1920
  • Effects:
    Prestige: +1
    Events enabled: "Moral Progress" (#23048)

Gustav von Schmoller

Schmoller's opposition to Neoclassical economics entered him into a famous methodological debate (Methodenstreit) with Carl Menger. Although many argue that he lost the debate by the simple fact of non-engagement (it is reported that upon receiving Menger's Investigations, he returned it unread to its author and published a 'semi-review' of it claiming that, indeed, it had not even been worth reading), Schmoller nonetheless retained his grip on the German university appointment system and kept Classical and Neoclassical economic theory largely out of German teaching - earning him the eternal emnity of the only potential challenger at the time, Menger's Austrian School. Gustav Schmoller's political involvements were also important, in 1872, he formed the "Verein für Sozialpolitik", ('Society for Social Policy'), a group of largely conservative economists which supported a kind of corporatist state-industry-labor nexus. Liberals deplored their advocacy for state interventionism and came to label Schmoller and the Historicists as "Kathedersozialisten" (or 'Socialists of the Chair') - a jest they never entirely lived down.

  • ID: 336
  • Prerequisite Techs/ Inventions: The Historical Theory
  • Years: 1885 - 1920
  • Effects:
    Prestige: +1
    Events enabled: "Society for Social Policy" (#23049)

Adolph Wagner

Although one of the more active members of Schmoller's Verein, Wagner actually supported Menger in the Methodenstreit. His work on public finance is what he is best known for in economics. Outside economics, he was a companion of Lassalle and Rodbertus - although not sharing wholly in their socialist ideals and of more conservative instincts in political matters, Wagner was a severe critic of unfettered capitalism and recommended state alleviation of the burden upon labor. He wrote Science of Finance Vol 1-4 (1877-1901), and Foundations of Political Economy (1876).

  • ID: 337
  • Prerequisite Techs/ Inventions: The Historical Theory
  • Years: 1885 - 1920
  • Effects:
    Prestige: +1
    Events enabled: "Fiscal Policy" (#23050)

William Cunningham

Cunningham was a vocal opponent of the nascent Neoclassical economics, particularly as propounded by his colleague, Alfred Marshall and the Cambridge School. In economics, he sought to promote the historical method, making him one of the most leading advocates of the English Historical School. Despite the sustained attacks levied by Cunningham, Marshall was sufficiently influenced by his pleas to try to include some more historical content in his work and operate more 'inductively' in the derivation of his economic principles. However, he refused to accept Cunningham's main charge -- that the validity of economic laws is conditional on historical, social and cultural context. Cunningham's opposition to Neoclassicism was not only one of method, but also of politics. Cunningham was deeply opposed to utilitarian philosophy and laissez-faire politics, and penned several tracts defending labor unions and protectionism. He also resurrected much interest in old Mercantilist thought.

  • ID: 338
  • Prerequisite Techs/ Inventions: The Historical Theory
  • Years: 1885 - 1920
  • Effects:
    Prestige: +1
    Events enabled: "Contextual Economics" (#23051)

Johann Heinrich von Thünen

Johann Heinrich von Thünen was a North German landowner from the Mecklenberg area. Although educated at Göttingen, he spent most of his life managing his rural estate, Tellow. In the first volume of his treatise, The Isolated State (1826), he laid down the first serious treatment of spatial economics, connecting with the theory of rent. His second volume (1850) developed the essence of the marginal productivity theory of distribution in a mathematically precise way, thereby making one of the most important Proto-Marginalists of the era. Nearing his death, he asked that his famous equation for the marginal product of labor, or natural wage, be carved into his tombstone.

  • ID: 339
  • Prerequisite Techs/ Inventions: Neoclassical Theory
  • Years: 1885 - 1920
  • Effects:
    Prestige: +1
    Events enabled: "Land Use Model Implemented" (#23052)

Léon Walras

The French economist Léon Walras (pronounced 'Valrasse') has been hailed by Joseph Schumpeter as 'the greatest of all economists'. Walras was one of the three leaders of the Marginalist Revolution, even though his greatest work, Elements of Pure Economics, was published in 1874, three years after those of William Stanley Jevons and Carl Menger. Nonetheless, alone among the three revolutionaries, Léon Walras set forth the new 'marginalist' or 'Neoclassical' theory in a formal general equilibrium setting. Thus, he endowed it with the multi-market considerations Jevons had largely avoided and the mathematical precision Menger had eschewed. Léon Walras is widely and rightfully regarded as the father of general equilibrium theory.

  • ID: 340
  • Prerequisite Techs/ Inventions: Neoclassical Theory
  • Years: 1885 - 1920
  • Effects:
    Prestige: +1
    Events enabled: "Walrasian Auctioneer" (#23053)

Stanley Jevons

The impact of Jevons on economics can hardly be exaggerated. As the father of Neoclassical economics, his legacy is secure. However, in some ways, he stopped short of the mark. Jevons could have gone further by connecting his insights in pure exchange into a wider theory incorporating production, capital, money and the business cycle in a more systematic and consistent manner that would have knocked the Ricardian School completely out of the picture. Had he not died so young, Jevons might yet have done so, but the next economics treatise he was working on (published posthumously in 1905), did not really seem to go in that ambitious direction. As such, by the time of his death, the Marginalist Revolution was still in its insurrectionist phase. It was still a tentative proposition rather than a firmly-set and integrated system, a scientific hypothesis but not quite yet a science. It should be noted that Jevons made maybe as much for the subject of Logics as for economics, which is quiet a feat.

  • ID: 341
  • Prerequisite Techs/ Inventions: Neoclassical Theory
  • Years: 1885 - 1920
  • Effects:
    Prestige: +1
    Events enabled: "Production Efficiency" (#23054), "Resource Depletion" (#23055)

Carl Menger

Carl Menger has been hailed as one of the three leaders of the 'Marginalist Revolution' of the 1870s, along with William Stanley Jevons and Léon Walras. However, Menger's "Grundsätze" (Principles), published in 1871, eschewed all the mathematical scaffolding that characterized the works of the other two revolutionaries. As such, many economists have insisted that Menger should be placed apart. In one sense, he can be considered different. Unlike Jevons or Walras, Carl Menger founded a proper 'school of thought' which has more-or-less retained its distinctive character since - namely, the Austrian School. His two disciples at Vienna, Eugen von Böhm-Bawerk and Friedrich von Wieser did much to advance and forge that school.

  • ID: 342
  • Prerequisite Techs/ Inventions: Neoclassical Theory
  • Years: 1885 - 1920
  • Effects:
    Prestige: +1
    Events enabled: "Law of Diminishing Marginal Utility" (#23056-57)

Thorstein Veblen

"Thorstein Veblen is to economics what Jonathan Swift is to English literature: a master of the art of satire. Is is essential to effective satire that its message be ambiguous: the reader should never be sure whether the author is absolutely serious or just pulling his or her leg That quality is certainly present in Swift's Gulliver's Travels and it is also present in Veblen's Theory of the Leisure Class (1899), The Instinct of Workmanship (1914), Imperial Germany and the Industrial Revolution (1915), The Higher Learning in America (1918), Absentee Ownership (1923), and his many essays. In fact, it is there in everything he wrote except The Theory of Business Enterprise (1904), which is as near as he ever came to writing a conventional academic book. No matter which of these books we open, we find the idea that life in a modern industrial community is the result of a polar conflict between 'pecuniary employments' and 'industrial employments', between 'business enterprise' and 'the machine process', between 'vendibility' and 'serviceability'-in short, between making money and making goods. There is a class struggle under capitalism, not between the bourgeoisie and the proletariat, but between businessmen and engineers. Pecuniary habits of thought unite bankers, brokers, lawyers and managers in a defence of private acquisition; in contrast, the discipline of the machine unites workers in industry and more especially the technicians and engineers who supervise them."

  • ID: 343
  • Prerequisite Techs/ Inventions: Neoclassical Theory
  • Years: 1885 - 1920
  • Effects:
    Prestige: +1
    Events enabled: "Conspicuous Consumption" (#23058), "Utilized Consumption" (#23059)

Alfred Marshall

"He was, first and foremost, a brilliant and original theorist; but he also passionately believed that economics should contribute to human well-being and that economics students should know as much about the economic and social facts of the real world as of the theoretical approaches through which they could be organised and understood. Many of the tools we use today originated with Marshall - partial equilibrium analysis, supply and demand curves, the concepts of elasticity, consumers' and producers' surplus, the device of splitting time into market, short and long periods - all of these and much else come to us from Marshall, mainly through his famous Principles. The book was first published in 1890 and it went through eight editions in his life time."

  • ID: 344
  • Prerequisite Techs/ Inventions: Neoclassical Theory
  • Years: 1885 - 1920
  • Effects:
    Prestige: +1
    Events enabled: "Price Elasticity" (#23060)

Augustin Cournot

French philosopher, mathematician and economist, Augustin Cournot has been rightly hailed as one of the greatest of the Proto-Marginalists. The unique insights of his major economics work, Researches into the Mathematical Principles of Wealth (1838) were without parallel. Although neglected in his time, the impact of Cournot work on modern economics can hardly be overstated.

  • ID: 345
  • Prerequisite Techs/ Inventions: Neoclassical Theory
  • Years: 1885 - 1920
  • Effects:
    Prestige: +1
    Events enabled: "Market Equilibria" (#23061-62)

Jules Dupuit

Jules Dupuit was perhaps the most illustrious of the French engineer-economists. Trained at the École des Ponts et Chaussées in Paris, Dupuit had a distinguished career as a civil engineer. From his work with infrastructure he was inspired to develop economic theory deeper.

  • ID: 346
  • Prerequisite Techs/ Inventions: Neoclassical Theory
  • Years: 1885 - 1920
  • Effects:
    Prestige: +1
    Events enabled: "Economic Engineering" (#23063)

Vilfredo Pareto

The Italian economist Vilfredo Pareto was one of the leaders of the Lausanne School and an illustrious member of the 'second generation' of the Neoclassical revolution. Although only mildly influential during his lifetime, his 'tastes-and-obstacles' approach to general equilibrium theory were resurrected during the great 'Paretian Revival' of the 1930s and have guided much of economics since.

  • ID: 347
  • Prerequisite Techs/ Inventions: Neoclassical Theory
  • Years: 1885 - 1920
  • Effects:
    Prestige: +1
    Events enabled: "Pareto Efficiency on the Market" (#23064)

Knut Wicksell

He was a Swedish economist whose work led to the widespread use of the word 'natural' to explain the long-run equilibrium rate of interest. Wicksell had a tremendous influe nce on economist James M. Buchanan. According to Buchanan, his theory of public choice 'was an almost natural consequence of my absorption of the Wicksellian message,' which stated that economists must cease acting as if government were a benevolent despot. Wicksell was a Malthusian and a strong advocate of birth control. He spoke out on moral issues quite often. He is best known for his work in 'Interest and Prices', in which he laid out his version of the quantity theory of money. His version wa s different from the standard view at that time in that he looked at the indirect effect that the money supply has on prices. Wicksell also elaborated on the theory of marginal productivity, which states that the payment to each factor of production equals that factors marginal productivity. He also stated that an efficient allocation of resources does not guarantee equitable distribution, because the preexisting distribution of income determines what form this allocation will take, and the preexisting distributionof income is not always just. The Stockholm School developed its own version of macroeconomics, which was based on Wicksell's work on quantity and price theory.

  • ID: 348
  • Prerequisite Techs/ Inventions: Neoclassical Theory
  • Years: 1900 - 1920
  • Effects:
    Prestige: +1
    Events enabled: "Money Stock in Balance" (#23065), "Money Stock Surplus" (#23066), "Money Stock Deficit" (#23067)

Irving Fischer

Irving Fisher was one of the earliest American Neoclassicals of unusual mathematical sophistication. He made numerous important contributions to the Neoclassical Marginalist Revolution. This Yale economist was an eccentric and colorful figure. When Irving Fisher wrote his 1892 dissertation, he constructed a remarkable machine equipped with pumps, wheels, levers and pipes in order to illustrate his price theory - see here for pictures of his draft and his first and second prototypes. Socially, he was an avid advocate of eugenics and health food diets. He made a fortune with his visible index card system - known today as the rolodex - and advocated the establishment of an 100 percent reserve requirement banking system. His fortune was lost and his reputation was severely marred by the 1929 Wall Street Crash, when just days before the crash, he was reassuring investors that stock prices were not overinflated but, rather, had achieved a new, permanent plateau.

  • ID: 349
  • Prerequisite Techs/ Inventions: Neoclassical Theory
  • Years: 1903 - 1920
  • Effects:
    Prestige: +1
    Events enabled: "Fischer Equation" (#23068)

Joseph Schumpeter

After a quick doctorate at Vienna, Schumpeter roamed about as something of a footloose lawyer until he rejoined academia in 1909. It was while he was teaching at Czernowitz (now in the Ukraine) that he wrote his Theory of Economic Development (1911), where he first outlined his famous theory of entrepreneurship. He argued those daring spirits, entrepreneurs, created technical and financial innovations in the face of competition and falling profits - and that it was these spurts of activity which generated (irregular) economic growth. In 1919, Schumpeter became the Austrian Minister of Finance - unfortuantely, presiding over the hyperinflation of the period, and thus was dismissed later that year. Although excelling as a teacher above everything, Joseph Schumpeter nonetheless completed three more books while at Harvard: his didactic Business Cycles (1939), his popular Capitalism, Socialism and Democracy(1942) - in which he famously predicted the downfall of capitalism in the hands of intellectuals.

  • ID: 350
  • Prerequisite Techs/ Inventions: Neoclassical Theory
  • Years: 1907 - 1920
  • Effects:
    Prestige: +1
    Events enabled: "Creative Destruction" (#23069)

Eugen von Böhm-Bawerk

Böhm-Bawerk's career as a scholar was an intermittent one. The most significant span of scholarly activity was his years at the University of Innsbruck (1881-1889). It was during the 1880s that he first published two of the three volumes of his magnum opus, Capital and Interest. His later years were dominated by his duties as the Austrian Minister of Finance, a position he held, though not continuously, throughout the 1890s and beyond-and for which he is fittingly honored by having his likeness on Austria's one-hundred schilling note. After serving in this capacity and assuming other governmental duties, he returned to teaching in 1904. With a chair at the University of Vienna, he became a colleague of Wieser, successor to the retired Menger. Students who passed through the university during the last decade of Böhm-Bawerk's career (and life: he died in 1914) included Joseph Schumpeter and Ludwig von Mises.

  • ID: 351
  • Prerequisite Techs/ Inventions: Neoclassical Theory
  • Years: 1886 - 1920
  • Effects:
    Prestige: +1
    Events enabled: "The Future of Savings" (#23070)

Polypoly Structure

This mean that the legislation of your country has structured the market in such way that each line of business compromise of numerous firms most of which is of the same size.

Oligopoly Structure

This mean that the legislation of your country has structured the market in such way that each line of business compromise of a few firms all of which is of large size.

Monopoly Structure

The legislation of your country has structured the market in such a way that each line of business is dominated by one very large company.

Limited Partnership Company

This was the first legislation enacting the possiblities for ownership in a firm without direct responibility. This was the first step to ensure infusion of capital form private citizens.

  • ID: 355
  • Prerequisite Techs/ Inventions: Business Regulations
  • Years: 1840 - 1920
  • Effects:
    Tax efficiency: +1%
    Education costs: +0.5%
    Crime fighting costs: +0.5%
    Capitalist income bonus: +3%

Joint-Stock Company

This legislation increased the possibilities for firms to get infusions of capital in an effective way. It also gave private investors the highest possible return on investment at a certain risk.

Patent

This legislation ensured the time-set ownership of the intellectual property of inventions vastly encouraging inventors to produce their ideas and sell it to firms that could manufacture them.

  • ID: 357
  • Prerequisite Techs/ Inventions: Business Regulations
  • Years: 1860 - 1920
  • Effects:
    Factory cost modifier: -3%

Trademark

This legislation meant security for a firm with a special product. The product often had a strong market position because of certain psychological attribute as it was associated with security, quality etc.

  • ID: 358
  • Prerequisite Techs/ Inventions: Business Regulations
  • Years: 1860 - 1920
  • Effects:
    Factory cost modifier: -2%

Anti-Trust Laws

This legislation stopped concentration of power on the market. Sometimes an actor became too big and competition diminished on the market which meant that prices was raised unproportionally.

  • ID: 359
  • Prerequisite Techs/ Inventions: Market Regulations
  • Years: 1880 - 1920
  • Effects:
    Tax efficiency: +1%
    Education costs: +0.5%
    Crime fighting costs: +0.5%
    Crime fighting efficiency: +1%

Financial Regulations

At this point regulations where introduced to check the activity of individual firms on the financial market.

  • ID: 360
  • Prerequisite Techs/ Inventions: Market Regulations
  • Years: 1880 - 1920
  • Effects:
    Tax efficiency: +1%
    Education costs: +0.5%
    Crime fighting costs: +0.5%
    Crime fighting efficiency: +1%

Banking Regulations

At this point regulations where introduced to check the activity of individual banks.

  • ID: 361
  • Prerequisite Techs/ Inventions: Market Regulations
  • Years: 1880 - 1920
  • Effects:
    Tax efficiency: +1%
    Education costs: +0.5%
    Crime fighting costs: +0.5%
    Crime fighting efficiency: +1%

Working Board of Directors

The business culture of having a working board of directors meant that those who made the long-run strategic decisions for the company also worked with its daily practises, which paved the way for good decisions.

  • ID: 362
  • Prerequisite Techs/ Inventions: Economic Responsibility
  • Years: 1895 - 1920
  • Effects:
    Tax efficiency: +1%
    Education costs: +0.5%
    Crime fighting costs: +0.5%
    Crime fighting efficiency: +1%

Bankruptcy Proceedings

By instituting rules for the proceeding of bankrupcies these not only became simpler and faster, but uncertainty of creditors also decreased.

  • ID: 363
  • Prerequisite Techs/ Inventions: Economic Responsibility
  • Years: 1895 - 1920
  • Effects:
    Tax efficiency: +1%
    Education costs: +0.5%
    Crime fighting costs: +0.5%
    Crime fighting efficiency: +1%

Annual Report Proceedings

By instituting rules for the proceeding of annual reports for the firm the transparency of the market increased to the joy of both investors and owners. It was also easier to monitor firms that had problems.

  • ID: 364
  • Prerequisite Techs/ Inventions: Economic Responsibility
  • Years: 1895 - 1920
  • Effects:
    Tax efficiency: +1%
    Education costs: +0.5%
    Crime fighting costs: +0.5%
    Crime fighting efficiency: +1%

Work Classification

By classifying work tasks the organization of production was increased and made more efficient.

  • ID: 365
  • Prerequisite Techs/ Inventions: Organized Factories
  • Years: 1850 - 1920
  • Effects:
    Artillery-, Luxury Furniture-, Luxury Clothes-, Tank-, Aeroplane Factory: Production modifier +0.5%
    Explosives-, Regular Clothes-, Furniture-, Small Arms-, Steel-, Automobile Factory, Clipper-, Steamer Shipyard: Production modifier +1%
    Winery, Liquor Distillery, Dye-, Ammunition-, Electric Gear-, Telephone Factory, Fuel Refinery: Production modifier +2%
    Fertilizer-, Glass-, Cement-, Fabric-, Canned Food Factory: Production modifier +3%

Work Specialization

By specializing workers and given certain tasks to certain workers tasks was done faster and with higher competence.

  • ID: 366
  • Prerequisite Techs/ Inventions: Organized Factories, Work Classification
  • Years: 1850 - 1920
  • Effects:
    Artillery-, Luxury Furniture-, Luxury Clothes-, Tank-, Aeroplane Factory: Production modifier +0.5%
    Explosives-, Regular Clothes-, Furniture-, Small Arms-, Steel-, Automobile Factory, Clipper-, Steamer Shipyard: Production modifier +1%
    Winery, Liquor Distillery, Dye-, Ammunition-, Electric Gear-, Telephone Factory, Fuel Refinery: Production modifier +2%
    Fertilizer-, Glass-, Cement-, Fabric-, Canned Food Factory: Production modifier +3%

Work Control and Hierarchy

By introducing work control and hierarchy each workers tasks where supervised in a professional way and decisions on the production floor was decided quick and efficient.

  • ID: 367
  • Prerequisite Techs/ Inventions: Organized Factories, Work Specialization
  • Years: 1850 - 1920
  • Effects:
    Artillery-, Luxury Furniture-, Luxury Clothes-, Tank-, Aeroplane Factory: Production modifier +0.5%
    Explosives-, Regular Clothes-, Furniture-, Small Arms-, Steel-, Automobile Factory, Clipper-, Steamer Shipyard: Production modifier +1%
    Winery, Liquor Distillery, Dye-, Ammunition-, Electric Gear-, Telephone Factory, Fuel Refinery: Production modifier +2%
    Fertilizer-, Glass-, Cement-, Fabric-, Canned Food Factory, Lumber Mill: Production modifier +3%

Sequence Planning

This meant going through every sequence in the production from buying resources to the selling of the finished goods and to measure them in time and money to make the chain of sequences as efficient as possible.

  • ID: 368
  • Prerequisite Techs/ Inventions: Scientific Management
  • Years: 1860 - 1920
  • Effects:
    Artillery-, Luxury Furniture-, Luxury Clothes-, Tank-, Aeroplane Factory: Production modifier +0.5%
    Explosives-, Regular Clothes-, Furniture-, Small Arms-, Steel-, Automobile Factory, Clipper-, Steamer Shipyard: Production modifier +1%
    Winery, Liquor Distillery, Dye-, Ammunition-, Electric Gear-, Telephone Factory, Fuel Refinery: Production modifier +2%
    Fertilizer-, Glass-, Cement-, Fabric-, Canned Food Factory, Lumber Mill: Production modifier +3%

Inventory Planning

This meant planning ahead for inventories, tools and machines and having secured funds for new purchases to retain the level of production.

  • ID: 369
  • Prerequisite Techs/ Inventions: Scientific Management
  • Years: 1860 - 1920
  • Effects:
    Artillery-, Luxury Furniture-, Luxury Clothes-, Tank-, Aeroplane Factory: Production modifier +0.5%
    Explosives-, Regular Clothes-, Furniture-, Small Arms-, Steel-, Automobile Factory, Clipper-, Steamer Shipyard: Production modifier +1%
    Winery, Liquor Distillery, Dye-, Ammunition-, Electric Gear-, Telephone Factory, Fuel Refinery: Production modifier +2%
    Fertilizer-, Glass-, Cement-, Fabric-, Canned Food Factory, Lumber Mill: Production modifier +3%

Quality Assurance Procedure

This meant introducing a procedure to check that all products had the same and authorized level of quality.

  • ID: 370
  • Prerequisite Techs/ Inventions: Scientific Management
  • Years: 1860 - 1920
  • Effects:
    Artillery-, Luxury Furniture-, Luxury Clothes-, Tank-, Aeroplane Factory: Production modifier +0.5%
    Explosives-, Regular Clothes-, Furniture-, Small Arms-, Steel-, Automobile Factory, Clipper-, Steamer Shipyard: Production modifier +1%
    Winery, Liquor Distillery, Dye-, Ammunition-, Electric Gear-, Telephone Factory, Fuel Refinery: Production modifier +2%
    Fertilizer-, Glass-, Cement-, Fabric-, Canned Food Factory, Lumber Mill: Production modifier +3%

Time Studies

This meant checking how much time each task too for different workers and then analysing how work could be speed up, either by changing the way a specific taks was done or by moving tasks around in the sequence.

  • ID: 371
  • Prerequisite Techs/ Inventions: Time-saving Measures
  • Years: 1880 - 1920
  • Effects:
    Artillery-, Luxury Furniture-, Luxury Clothes-, Tank-, Aeroplane Factory: Production modifier +0.5%
    Explosives-, Regular Clothes-, Furniture-, Small Arms-, Steel-, Automobile Factory, Clipper-, Steamer Shipyard: Production modifier +1%
    Winery, Liquor Distillery, Dye-, Ammunition-, Electric Gear-, Telephone Factory, Fuel Refinery: Production modifier +2%
    Fertilizer-, Glass-, Cement-, Fabric-, Canned Food Factory, Lumber Mill: Production modifier +3%

Time Clock

By setting up regulated workhours the efficiency of the production increased. Workers could now work in shifts which further increased it. Though with the new regulation of workhours labourers left the old lifecycle of the farmers being awake from sunrise to sunset and it effected social life and increased tempo and stress.

  • ID: 372
  • Prerequisite Techs/ Inventions: Time-saving Measures
  • Years: 1880 - 1920
  • Effects:
    Artillery-, Luxury Furniture-, Luxury Clothes-, Tank-, Aeroplane Factory: Production modifier +0.5%
    Explosives-, Regular Clothes-, Furniture-, Small Arms-, Steel-, Automobile Factory, Clipper-, Steamer Shipyard: Production modifier +1%
    Winery, Liquor Distillery, Dye-, Ammunition-, Electric Gear-, Telephone Factory, Fuel Refinery: Production modifier +2%
    Fertilizer-, Glass-, Cement-, Fabric-, Canned Food Factory, Lumber Mill: Production modifier +3%

Lighting

By setting up lighting in the factory building the efficiency of the production increased. Workers could now work in nightshifts which further increased it.

  • ID: 373
  • Prerequisite Techs/ Inventions: Time-saving Measures
  • Years: 1880 - 1920
  • Effects:
    Explosives-, Artillery-, Luxury Furniture-, Luxury Clothes-, Tank-, Aeroplane Factory, Clipper Shipyard: Production modifier +1%
    Regular Clothes-, Furniture-, Small Arms-, Automobile Factory: Production modifier +2%
    Winery, Liquor Distillery, Dye-, Ammunition-, Steel-, Telephone Factory, Steamer Shipyard, Fuel Refinery: Production modifier +3%
    Fertilizer-, Glass-, Cement-, Fabric-, Canned Food-, Electric Gear Factory, Lumber Mill: Production modifier +5%

Old Style Family Business

This style of business culture meant that the owners treated the business as a family shop or restaurant. The border between private and business was very unclear. The practise became very emotional and the owners would take much large risk for their business, but at the cost of professionalism.

Anynomous Investor Business

This style of business culture meant that the owners treated the business as an investment. Ownership was not about producing and selling things. Instead the only reason for being the owner was to see the business ratios to raise. This practise was professional, but lacked commitment and was intensely risk-aversive.

Marketized Smallholder Business

This style of business culture meant that the owners where either foundations or household investors. This often meant a conservative but sound regime.

Buying on Margin

As more individuals became involved in investing in securities markets in the early twentieth century, the practice of buying on margin developed to increase the amount of shares that could be bought with minimal initial overhead. The principal of buying on margin is that if the investment makes a profit, the profit would cover the cost of the commission charged for allowing the purchase of large amouts of securities with only a minimal initial investment. The risk involved in this type of investment is that if the investment shows a loss, the difference between the initial investment and the commission charged for the purchase must be made up by the investor. How low an initial margin was prudent for the securities industy to accept would be the subject of intense debate, as lower margins both allowed investors with limited capital to invest in markets, but raised the risk of default by these limited-capital investors should the investments fail to produce profits.

  • ID: 377
  • Prerequisite Techs/ Inventions: Mutual Funds
  • Years: 1919 - 1935
  • Effects:
    Education costs: +0.5%
    Crime fighting costs: +0.5%
    +25% Chance for event "Stock Market Crash" (#23000; Income bonus for Rich: -10%)
    +25% Chance for event "Stock Market Hausse" (#23004, Income bonus for Rich: +10%, Income bonus for Poor: -5%)

Hyperinflation

For many nations, the socioeconomic strains caused by involvement in wars with other industrial nations resulted in huge deficits that made it impossible to return immediately to the gold standard. Some nations, facing new demands upon their incomes as a result of new social obligations to those involved in recent wars or obligations for being on the losing side of wars, found the demands too great, and sought to resolve their problems by expanding the amount of currency of circulation. With nothing to guarantee the value of the currency, the result would be to rapidly depreciate the value of the currency relative to other currencies or materials such as gold. The social impact of such government policies were traumatic, especially for those who lived on limited or fixed incomes or those who had investments denominated in the rapidly depreciating currency. To many, the willingness of the State to engage in such activity, and the market reaction to such activities, would lead to a search for alternative ideologies to restore order and stability in society.

  • ID: 378
  • Prerequisite Techs/ Inventions: Market-Determined Exchange Rates
  • Years: 1919 - 1935
  • Effects:
    Ideology for 5% of POPs: Communist
    Ideology for 5% of POPs: Fascist

John Maynard Keynes

An English economist who challenged the orthodox view of the role of the State in the management of economic forces in society and the relationship between supply and demand in times of economic crisis. Drawing upon the abilities of states to mobilize their economies during wars with other industrial nations, Keynes maintained that the State could use its influence to promote more efficient economic development. But his most radical theory involved the role of aggregate demand in the economy, arguing that it was demand, not supply, that was the final determinant in the levels of output and growth that an economy could produce, and that in times of economic slowdown or crisis, the solution to the crisis involved revival of demand to absorb excess supply and create the conditions for a revival of production to meet further increases in demand. While his theories had many critics, they became highly influential as the twentieth century progressed.

  • ID: 379
  • Prerequisite Techs/ Inventions: Keynesian Economics
  • Years: 1919 - 1935
  • Effects:
    Prestige: +1

Richard Kahn

An English economist who first developed the concept of the multiplier effect of spending in an economy in the early 1930s. At its base, this is the concept that spending in the economy for goods and services produced new potentials for demand by the providers of those initial goods and services, creating an expansion of demand beyond the initial value of the original spending. Adopted by John Maynard Keynes in his concept of the role of aggregate demand in the functioning of the economy, the concept of the multiplier effect would be increasingly adopted by States facing economic slowdowns by encouraging the State itself to increase its spending in the economy as a way to revive weakened demand and restore economic growth.

  • ID: 380
  • Prerequisite Techs/ Inventions: Keynesian Economics
  • Years: 1919 - 1935
  • Effects:
    Prestige: +1

Ludwig von Mises

An Austrian economist who would challenge the growing influence of Keynesian economics upon the actions of the State in the 1930s. Von Mises argued that the attempt by the State to use its resources to revive demand in the economy created dangerous potentials for inflation of the economy and severe imbalances in the ability of the marketplace to find the balance between supply and demand that would ensure stable economic growth. Von Mises was also a sharp critic of socialist economic models, arguing that such models removed the ability of the market to determine price levels that would ensure adequate supply based on the demands of consumers for goods.

  • ID: 381
  • Prerequisite Techs/ Inventions: Keynesian Economics
  • Years: 1919 - 1935
  • Effects:
    Prestige: +1

Friedrich Hayek

An Austrian economist who would challenge the influence of Keynesian economics upon the actions of the State in the 1930s and attach the planned economic models inherent in both socialist and fascist political models increasingly in vogue in the era. Much like his teacher Ludwig von Mises, Hayek attacked Keynesian economic prescriptions for dealting with economic downturns as causing more potential problems than solutions by creating conditions for inflation by raising demand more rapidly than supply could meet. Hayek rejected the idea of central planning in the marketplace as highly inefficient in its ability to produce the supply and quality of goods that would be generated by consumer demand.

  • ID: 382
  • Prerequisite Techs/ Inventions: Keynesian Economics
  • Years: 1919 - 1935
  • Effects:
    Prestige: +1

Priming The Pump

In wake of a series of economic shocks that shook the world in the first part of the twentieth century some politicians would become influenced by new economic theories regarding supply and demand and their interplay in times of economic crisis. Based upon the concept that money spent in the economy has a multiplier effect that increases economic activity by generating income that can contribute to new demand, some politicians made appeals in wake of economic declines for ‘priming the pump” to reinflate demand and thus resume economic growth. Not all politicians and economist accepted this argument, and to some such state intervention appeared as an introduction of socialist principles into the economy, but the polticial impact of having the State appear to be actively trying to improve economic conditions made such poltical promises very appealing to those negatively impacted by economic downturns.

Mixed Economy

As the twentieth century developed and the influence of alternative models of economic development outside the capitalist framework began to be implemented in certain societies, some politicians began to consider the possibility that merging what were considered the best elements from both capitalism and command economies could produce benefits for their society as a whole. As a result in some nations moves were made by the State to introduce elements of state direction into certain areas of economic activity while preserving the basic capitalist elements at the root of the economic system. While many more ideologically-driven critics of such policies argued the policies either went too far or not far enough in their transformations of the economy, the results of creating a mixed economic system in terms of both restoring economic production and reducing social tensions were often quite impressive.

Centralized Economic Planning

As more radical ideological alternatives to liberal democracy gained power in the early twentieth century, the opportunity to reconstruct economic organization based on State direction of economic activity that could be compared to the relative success or failure of traditional market-based economic structures arose. Such programs of centralized economic planning, employed by both communist and fascist regimes, often achieved dramatic initial results in reducing unemployment, increasing output of industrial goods, and removing the problem of conflict between laborer and employer in society, which the regimes would trumpet as proof of the superiority of their systems over free market systems. The social and economic costs to these societies, however, were often very high, and the resistance to State control created the potential for brutal repression. However, to the outside world that new little of the negative consequences of these plans, they seemed to suggest a viable alternative to the free-market systems that had been the hallmark of nineteenth century economic theory.

Autarky

Derived from the Ancient Greek for self-sufficiency, in the early twentieth century autarky was the goal for many States that felt further dependence upon the global economy was a threat to their national independence or the ideological basis of their regimes. In order to achieve autarky, such states would impose huge tariff barriers to imports from overseas, encourage the development of local industries to produce goods previously imported, strictly regulate foreign trade to preserve national income, and investigate the development of alternative substitutes to critical raw materials that were not available to the nation except from the world market. As an economic policy autarky could be called a twentieth-century revision of mercantilism, and while most often used by Communist and Fascist regimes that rejected all or part the capitalist model of economic production, even capitalist nations would resort to elements of autarky in times of economic instability, especially if they controlled large overseas empires that could provide key raw materials.

Import-Substitution Industrialization

The growth of the global economy in the nineteenth and early twentieth century resulted in increased demand for industrial goods by non-Western societies. However, the realities of war in the industrial age and increasing economic instability of periods of expansion and contraction resulted in non-Western societies at times being unable to meet their needs for industrial goods from the traditional producers of such goods in the West. As a result, an opening for producers in non-Western societies to meet the demand for those industrial goods that could not be acquired easily from the West arose, and industrialization in the non-Western world began to grow. Eventually pressure to protect these new industries from competition from overseas would lead some nations which had maintained political independence to adopt policies of import substitiution industrialization to encourage their societies to break their dependence upon the West for industrial goods and, by extension, strengthen their own societies in the global economic system. Import substitution industrialization would gain in influence during the course of the twentieth century as the resources of the West were dedicated more towards resolving problems in the West.

Scientific Management

A theory of production management developed by Frederick William Taylor in 1911 that asserted that worker productivity could be maximized by optimizing different tasks to those workers who are best able to perform those tasks. In combination with the provision of break times to workers to break the monotony of the daily work routine, Taylor’s theories of worker management and “fitting the worker to the job” would come to be embraced as a basic tenet to maintaining and expanding production. However, one limit to Taylorism was its emphasis of the worker as simply part of the production process and as the twentieth century evolved some commentators came to see Taylor’s approach to worker management as a cause of increased interest in labor unions and socialism among the working class.

  • ID: 388
  • Prerequisite Techs/ Inventions: Organizational Development
  • Years: 1919 - 1935
  • Effects:
    All Factories: Production modifier +1%

Human Resource Development

A theory of production management developed from the work of Elton Mayo based on research into productivity conducted at the Hawthorne Works in Chicago in the United States in the 1920s. Challenging the theories of Scientific Management, the Hawthorne Studies, and the interpretation of the data provided by Mayo, a more “human-centered” approach to worker management as the key to improved productivity was developed. By making workers feel they were a valued part of the production process and not simply “cogs in the machine” productivity would increase. While the analysis of the data was disputed by many researchers, the arguments gained influence as the twentieth century evolved.

  • ID: 389
  • Prerequisite Techs/ Inventions: Organizational Development
  • Years: 1919 - 1935
  • Effects:
    All Factories: Production modifier +1%