*Main outtakes of this lesson:* 1) Economics is the study of scarcity and choices. We have limited resources, so we need a way to analyze the best way to use them. 2) Significant sustained increase in people's lives happened after _Industrial Revolution_. 3) Adam Smith concluded that _division of labor_ made countries wealthy. a. Analogy: one pizza takes few people to be created. One prepares ingredients, another puts it in the oven, another one puts it in the box. This division makes each worker more productive, since each one is focused on a thing they do best and they don't need to spend time switching between the tasks. b. Without _specializations_, if you want something - you have to make it yourself. c. So if you are good at producing something - specialize at it and then _trade_ with others. 4) Production Possibilities Frontier (PPF) shows different combinations of two goods being produced using all resources efficiently. a. Every possible combination inside the curve is inefficient. On the curve - efficient. Outside - impossible. b. The country that can produce more goods of one kind (per time) than another country is having an _absolute advantage_ over another country in production of those goods. c. _Opportunity cost_ is a cost of production of good, measured in losses in production of another good. d. Country that can produce good with cheaper opportunity cost, has _comparative advantage_ over another country. e. Individuals and countries should specialize in producing things in which they have a comparative advantage and then trade with other countries that specialize in something else. This trade is mutually beneficial. 5) If there is one point where economists agree it's that specialization and trade makes the world better off. 6) *Self-sufficiency is inefficiency*
"Self-sufficiency is inefficiency." I love it. I can't tell you how many times I've tried to explain this to people. We humans are better off when we collaborate then when we try to go it alone. We're all in this together. That you drew this lesson from Adam Smith, one of the laissez-faire heroes of many of the people to whom I have to keep trying to explain this, just makes it even better.
Matthew Prorok If you're saying you intend to take an argument about the efficiency benefits of specialization as a ringing endorsement of socialism or socialistic public policy, I'll just tell you to stop where you are: it's a pure non sequitur on your part to so conclude.
Of course not. It's not an endorsement of socialism, or socialist policy, but of *societies*. Any form of social organization is going to promote specialization; the whole of human history should give plenty of evidence of this. Humans work better in groups than they do alone; resources are used more efficiently by people working in concert than in isolation. Which specific social structures are best at promoting that is a much bigger discussion, of course. It's more an argument against anarchism than for socialism.
So basically it is like the human body; each individual cell working by itself to survive is highly inefficient and ineffective but as soon as you put these cells together to make up a system called human body they work in harmony as a single organism to increase efficiency and become allot more effective. This can also be seen in ecosystems; and how nature operates and manages efficiency.
There is one point to be considered and I was quite disappointed they didn't mention it: Work can give your life meaning, making you feel like you are contributing something good to humanity. For example: You make Pizzas, you feed humans and make them happy. Your product, the pizza will make you happy every time you finish one and you see your product. However specialization can make you loose your sense of purpose. After all, you are only producing a tiny fraction to the final product, and that can make you forget what you are working for. Which is feeding ppl and making them happy. This can result in people hating their jobs, since specialization is efficient, but it makes you loose your sense of purpose.
Traditional economic assumed that human chase benefit, not happiness. It might not work well in individual scale, but should be quite okay in large-scale. I could believe that most of pizza makers in the world do their job because they can earn and pay their lieves - happiness came afterwards but not mandatory.
Abhishek Sehgal Ah, yes! Diversification really is an important & integral principal of our planet Earth's operating system and perhaps in general. Thanks for identifying and reminding me of it.
"Self-sufficiency is inefficiency" -- That quote is spot on. It rings true in the world of business, leadership, and it is applicable to life as a whole.
Pearl Playdinn It isn't. I believe it is a matter of the *level* of self-suffieciency one aspires for. Defining yourself as self-sufficient is contrary to reality. Nature itself is not self-sufficient, much less human beings, or any complex system that may be established by them.
If the country was divided by itself (the rich and the poor, the industrialized and the undeveloped, shoe making complexes and airplane complexes, etc.) self sufficiency can be efficient BUT just as you know people can move from each location (and other factors), making self-sufficiently inefficient in the Information Age.
As someone who has never formally studied economics before, I found that PPF graph and Mr. Clifford's explanation really helpful for understanding why it's beneficial for countries to trade.
Adam smith actually posited that while increased specialisation would make economies stronger and more productive, it would make the lives of workers more miserable. Think about it, the artisan shoe maker who crafts shoes by hand has a much more fulfilling job than the factory worker who operates a machine to put the plastic caps on shoe laces. This is a hidden, unquantifiable cost of specialisation. These sorts of hidden costs are why economic models fail to describe the world in a realistic manner. I really hope they talk about the limitations of economic models at some point.
@@djeieakekseki2058 I think specialisation is a more macro term for division of labour which the guy was really referring to. Yes using the division 0f labour method creates job dissatisfaction it also creates less occupational mobility and in a macro sense can lead to structural unemployment however in a micro sense a method was found and applied to factories where after a few hours workers switch jobs so that they become less bored
Gen Doukeshi Nope. Hot mics everywhere. I understand it can take a little extra time to balance the levels of two mics, but the effect of this issue should not be easily noticed by a novice in the field (me). C'mon, CrashCourse , your budget has to allow more than this. If it's a problem of time, I can wait a few extra hours for my dose.
Hi, you can adjust the speed on settings. On the video, you will see right next to subtitles/closed captions symbol. The Gear symbol you can adjust the speed - click on playback speed.
@@espartanam The only problem with that is that the lady speaks a little slower than normal, so if you slow it down then she becomes unbearably slow and if you keep it normal he's a bit too fast.
This is a refreshing choice of topic. After watching the first crash course economics, I thought the second ep will be on micro-economics stuffs like demand and supply but a straight dive to comparative advantage is surprising and refreshing.
HeyItsLavie Thing is, this is supply and demand. But with a shot in the ass. Party A is good at foo, and party B is good at bar. So they get better at foo/bar and invest less in bar/foo. This fluidity means that the market reacts to shortages and surpluses organically.
Qermaq yes of course, everything in economics is related to supply and demand. What I meant to say was that it's nice to see that they've jumped right into specialisation to ease people in before handing them concepts like price elasticity of demand and what not which I find to be a slow paced chapter
Yeah, I didn't even notice. As long as the content is interesting I don't think people will pay too much attention to speech styles. UNLESS ITS TOO FAST
Trade between two nations that have a comparable level of development is good for both, yes. However trade between a richer nation and a poorer nation, if unregulated leads to the less developed country being left unable to develop. Think about it. You have 2 Countries A&B, whose citizens interact economically without any government restriction. If country A has infrastructure (factories) and country B has natural resources and they are trading freely, country A will import natural resources from country B and export industrial products to country B. Country B cannot develop an industry of its own, as its products would be inferior in every way to country A`s. They only possible advantage they could have is cheaper labor. But then again, why would n`t workers from country B go and look for a better life in country A? Remember, no government restrictions. And why would country A`s enterprises relocate from country A to country B when B`s workers are coming to them? This is basically what West Europe (A) does to East Europe (B). It`s what the Global North (A) does to the Global South (B).
Although I do like the study of economics I would really like to see ChrashCourse do a series on philosophy (and not only the Western part) - I know some philosophers have appeared in the history-series, but to take a more direct focus would be pretty cool at some point.
Martin D. Petersen I would love to see a philosophy course as well. Many people see crash course as a study aid, whereas it really aims to help offer free education to people. The goal isn't to adhere to standards, as can be seen in the copyright and intellectual property mini series.
Martin D. Petersen You should really check out the channel "school of life". They make a lot of short and concise videos about philosophy and it's really great. Also, if you want something more in-depth you can check out Gregory B. Sadler's youtube channel, where you can find entire lectures about all sorts of things like an intro into philosophy or lectures about certain topics like Existentialism, Phenomenology or the core concepts in Philosophy.
The pretty good Gatsby I found that School of Life is rather arrongant in it's views. What I mean is, they dont really teach philosophy as much as they teach THEIR philosophy (what they consider to be the correct philosophical ideas). I agree with them on most things, but a teacher should teach about the subject, and not that much about their views on the subject. Also, they sometime go really wacky with their views, like in the video concerning why are some countries poor and others rich. Most of that lecture is very good, but the moment they touch on religion thay start formulating some VERY weird ideas. When people disproved those ideas, they just replied with "every rule has an exception"... Really?!
MarcianusImperator It also doesn't have the comments section online. Could you explain to me what the weird ideas were? I think I need more context in order to agree or disagree about this >>
Wasn't sure how this Course was going to go but after this episode I'm solidly rooting for you. Informative, engaging, and clearly presented, well done. I wish this was around way back in the dark ages when I took high school economics.
I had a couple of economics classes during my time in university, and I'm really happy to see the critism of this video is honestly directed at the content at not at the pace and style with which the models are introduced. I thought this was moving fast for many people, great to see everyone following along!
I just wanted to say thanks. I really like this series so far, and thank you for caring about the quality of view rather than the quantity. This series is a perfect example of all the right things about Nerdfighteria. DFTBA!
I first came across Crash Course in my junior year biology class. We had Hank as a host. Man, what a joy it was! I now use Crash Course whenever I'm stuck on a topic. They explain it so well!! (Crash Course also helped me get through my undergrad course).
This episode was much better than the last one. The fact that when telling a joke the actors stayed at the same pitch and volume as when they are not telling a joke definitely helped.
Thanks for stressing that that was a highly simplified model to understand a concept, because so many people fly off on a rant when i try to explain this. Other factors such as strategic importance of a domestic aircraft industry is why protectionism can come into play, distorting free trade I am really enjoying this series so far, and the idea of "The Runway" is brilliant for explaining graphs. Almost feels like something you'd see on BBC or CNN when they discuss economics
Evan. Dear Physics, you would have no funding if economists hadn't decided that the opportunity cost involved in your research was worth having people start at two slits for their whole life. Sincerely, Economics.
It is kind of amazing how these concepts also get applied in everyday life. Specialize in something and trade with other people having specialization in different fields and both can achieve growth in regular life too. Thanks Guys
No mention of David Ricardo?? Unless you are planning to do that in the next videos, I find it odd that you didn't mention him, since he had more to do with that topic than Adam Smith.
Damn. I can’t imagine not being a native English speaker and trying to understand this. They speak sooooo fast! Slowing it down to 0.75x makes it better for those struggling.
Love the design! Moving around the graph to highlight pieces of it was fantastic. The Runway, Ha! Thought bubble... still amazing. Keep up the good work.
kingofprussia17 You sir are enormously confusing. You call yourself the king of Prussia, which doesn't exist anymore as it is mostly in Poland. You have the image of the Union flag as your profile picture, perhaps indicating you're British. But you also speak as if you're American as you said you need more Mongols in the US. Consider me bamboozled.
Petey T I'm American who is mostly German and I like the Union Jack, a little different then the stars and stripes. I just want Mongols here for their pizza, good old western imperialism. lol
***** well everyone starts somewhere when it comes to geography, so you're not dumb. Prussia was the country that united most of the rest of the German lands about 140 years ago. It was a highly industrialized military state and it provided the framework for Germany between 1871 and 1945. After 1945 Prussia was almost completely stripped from Germany and granted to Poland in punishment for starting World War 2, and to create a buffer zone between Germany and the Soviet Union (Russia). All of the 12 million German inhabitants were kicked out or killed over the next few years. And so today Prussia doesn't exist at all anymore, so it's completely understandable that you don't know where it is. Poland is geographically near the centre of Europe, it is East of Germany, West of Belarus, North of Ukraine, and South of Scandinavia. A quick google map check would show you the whole area.
5:42 How could you possibly calculate one single opportunity cost for producing an extra plane? It depends on where you are in the curve. This can also be thought of as the derivative of the curve. For example, look at the US curve they give us. Let's say the US spends all of it's resources making shoes. Then, let's say that the US wants to allocate just enough resources to make 1 more plane than it currently is(currently not producing any planes). Then, the point on the curve would shift up 1 unit, and over to the left until you crossed the ppf curve(the intersection where everything is optimal). When the curve is steepest, it actually makes a lot of sense to produce more planes, because the opportunity cost is very low.
Jake Whitton is it possible for you to explain this in layman's terms? i'm attempting to learn economics (through reading, I'm watching crash course out of interest as to where it ends up leaning politically), but i've always been a bit shit at maths and graphs. if not possible without distorting the original point then nay worries
daisy kirtley DOn't worry about it. The curve is arbitrary. There's no such curve in real life, and the points they made in the video is good enough. If you're worried of derivation of the curve, it's the curve gradient or slope and any given point.
daisy kirtley Sure. I'll try to explain it simply. Imagine that you have 90 workers. Currently all 90 of those workers work at a factory that produces cars. Across the street, there is another factory that produces computers, but nobody is working there currently. The owner of the car factory wants to make more cars per day, so he hires more workers. However, he notices that the factory is already operating at full capacity. *Simply throwing more workers(resources, as the analogy goes) doesn't result in a worthwhile increase in yield.* So, because he isn't getting much out of these extra workers, he fires them. Then, the computer factory across the street sees those workers and decides to hire them. They all get the proper training and begin making computers. Now, the computer factory is making computer at a slow, but better than stopped, pace. Now, the owner of the computer factory decides to hire even more workers, to try and maximize yield. *Because the factory can benefit from more workers, it is wise to hire more workers, because the cost of paying more workers will be offset by selling more computers.* After a lot of hiring, the owner of the computer factory runs into a problem. Hiring more workers doesn't generate enough additional yield to pay for their salaries. The owner of the computer factory is in the same position as the owner of the car factory was. In short, you can't make a blanket statement like "Every time we hire a new worker, it will allow us to make 2 more computers per day." Whether or not that statement is true depends upon how many workers you currently have and how many you could theoretically have. Translating this into talk about nations, let's imagine the same situation, except you are trying to figure out how many workers should be in both factories. You have 1000 workers to disperse among the two factories. You start by placing 200 in the computer factory and 800 in the car factory. Now, you can shift workers as you see fit. Let's say you were to move 100 workers from one factory to the other. Would it be smarter to take the 100 workers from the small computer factory or the larger car factory. You notice that adding 100 workers to the car factory would increase the yield by 5 cars per day. If you added those same 100 workers to the computer factory, you could increase your yield by 50 computer per day. Obviously, the smart thing to do is to take 100 from the car factory and put them into the computer factory. The opportunity cost is simply what you lose out on if you send the workers to the computer factory rather than the car factory. If you send 100 workers to the computer factory, then you lose out on the 5 extra cars per day. However, you gain the 50 computers per day, so it ends up being a smart trade.
Some notes if anyone needs em! -Most historical events like wars and disputes can be explained by economics, by simply trying to understand who wanted what -Progress of humanity can be mapped using: life expectancy, child mortality, income per capita → industrial revolution was the first ever increase in the quality of life -Adam Smith concluded that it was the division of labor (specialization) that made countries wealthy, but it’s trade that makes them well-off -Production possibilities frontier (ppf) graph which shows different combinations of 2 goods being produced using all resources efficiently → anything inside the ppf is inefficient, anything on the line is efficient, and everything outside the ppf is impossible -If a country has the potential to make more of something, they have an absolute advantage in production -A comparative advantage is when a country has a smaller opportunity cost → meaning that with each product 1 they make, they lose less product B -Self-sufficiency is inefficiency and inefficiency can lead to poverty
Thanks a lot for sharing the knowledge with us. You guys are really adding the more things in our life which couldn't have happened of we have not gone through your crash course.
5:49 as you can see on the graph. You can also determine who's better at what just by looking at the difference of PPF on each axis. For instance, since US can produce 400 more planes than China, but only 200 more shoes than China, US is better off building planes than building shoes. Additionally, keep note of US = 1 plane/-2shoes and 1 plane/-8 shoes. You can also flip the fraction around, along with the integer, to make it into 2 shoes / -1 plane for the US, and 8 shoes /-1 plane for China when looking at the opportunity cost, or the comparative advantage that each country has over the other in term of production of certain goods. Since China can produce 8 shoes at the cost 1 plane, and US can produce 2 shoes at the cost of 1 plane, thus, China should specialize in shoes while US should priotize in planes production. You basically are able to produce 6 more shoes if China were to take care of the shoes production than US relying on itself ;to produce both shoes and planes.
I will be student teaching economics soon (I haven't taken an economics class ever) and these videos are SUPER helpful, and hearing it straight from an econ teacher makes it even better!
I learn so much from these shows. Thanks particularly for explaining the concept of specialization and trade. Having been into the reenactment scene for a bit and trying to do it all myself on one or two products, yes. I totally agree. Keep the lessons coming!
I am attempting to work out how self-sufficiency is inefficient in my particular case: Recently I started making fertilizer for my garden. It is made using materials I already own, but would normally throw away (kitchen-scraps), so in this way I am getting more value for the money I spend in groceries. Alternatively, I could buy the fertilizer from a specialized producer for x-amount of my income dollars and this would save me the time and effort it takes to prepare the materials, but i believe (estimate) the time it takes to make fertilizer is < the work-hours required to pay for it. Is self-sufficiency inefficient in this case? If so, consider this: If I specialized in the practice and sold the product, does this balance your concept?
Hell of a big gamble deciding to get new presenters/teachers. I can't stress enough how much it matters to me personally to have someone I can learn from, teaching. And from where I'm sitting, these two are.. perfect. Bring on economics!
you guys and the entire crash course team gives me much hope in a word saddled with the high consumption of irrelevant information im very grateful that u still find it worthy to make it your job to educate me and other people who want to learn the things that really matter thank you william, from Ghana
I thought I'd chime in. Volume, perfect. Voice speed, perfect. Btw, viewers, as already commented by someone, all of these are adjustable on your device. I am loving it and so thankful for this course.
I am 24 and I have understood for the first time ever the concept of trades. Before you come at me, I am the guy who is busy enough to design applications and website the likes of youtube so y’all can learn about all of this as well. Thank you very much Crash course
Great video. Interesting and accessible. I only just started looking into learning more about economics and found this series. The first video seemed a little dull but this one has a much better pace. Looking forward to seeing more!
This was really good! I watched this out of curiosity since the thumbnail looked good and now I’m going to finish this to set my basics hehe!! Thankssss
This is great. Keep them coming. I have a degree in Economics but it's still valuable to get a (for me) new and clearer explanation of things, which I think you succeed in. This helps to keep my overall skill or knowledge level high. Thank you
Raph Gealon Yeah, it's weird that they think that countering anti-intellectual sentiments is necessary for people watching educational videos on youtube. But maybe they're thinking of a general audience of school kids, where anti-intellectual attitudes are more common.
Dave Power #6 Their target audience might be high school students. So from an economic perspective, the trade off is catching more anti-intellectual audience over intellectual audience.
Raph Gealon The john oliver effect. He keeps saying subjects are really complicated when they aren't or that they're really boring when they're not. I don't know who he thinks his viewers are. ADHD 8 year olds?
Yeah. IMO, basically all they have to do to make it interesting to everyone is relate economics to the decisions you make in everyday life and voila it's interesting. Hopefully they do some of that in later episodes.
Concepts in this lesson: for me or whoever wants it lol (ib someone in the top comments) 1. ADAM SMITH- specialization made countries wealthy aka the division of labor + What is specialization- the process of concentrating on and becoming expert in a particular subject or skill so basically everyone has there own jobs to complete to get the job done faster. (assembly line type situation) makes people more productive + Benefits of Trade- -model- PPF Production Possibility Frontier - shows the different combinations of 2 goods being produced using all resources efficiently r e a l w o r l d i d e a - to understand that there's trade offs between producing 2 or more goods. absolute advantage- the ability to produce more of one good % still need trade % *jacob speaks too fast for my tiny brain* ^I''m 1/2 way through my economics course and am trying to understand things fully up to where im at anyways rip^ + Countries with lower opportunity cost for producing the good have the "comparative advantage" For the us for each additional good they produce they lose 2 of another. cHinA hAs a LoWer "opportunity cost" for shoes meaning they have the "comparative advantage". COUNTRIES WANT LOWEST OPPORTUNITY COST g o o d l u c k w i t h y o u r e c o n o m i c s c o u r s e let me get a rip in the chat okay bye
i know this question might never be replied to, but here it is: Are you sure specialization is truly more efficient? is there some externalities that might have been missed. The last two days, I have been building my own forklift from scratch using scrap. As I work, I realized that I am learning many new skills that not only I can apply to make my life better and help me do other things more efficiently, the fact that I am learning new skills means I also become better at learning and become smarter! Apply to this video's example, if you have to make a pizza from scratch, you would learn the skills you need to survive in a zombie apocalypse as well as improving you ability to learn and become smarter. If this is true, I fear that over specialization means people rely on others for specialized skills, and have to learn less and less skills. Eventually, this mental decline would result in people being so dumb that they couldn't make pasta ( just like in 2oolander ) and being conned by some fast talking salesman into electing a buffoon for President .... OH WAIT
jiunn wong Interesting arguement, and partial truth to it too! However I wouldn't ultimately discredit specialization. The U.S. participates in specialization within the country (ex: majors in college, clubs, specialized jobs, etc). Perhaps certain countries are limited by the knowledge they only can obtain in their geographical location. Because of specialization, certain, developed, civilizations have become financial superpowers today. But specialization does come with disadvantages too, no doubt.
I don't think that's what it's saying. It doesn't say that you shouldn't learn new skills. The point is that labor should be split more efficiently. With their example regarding pizza, the person who specialize in producing milk doesn't mean that he does not know how to grow wheat or that he doesn't know how to bake the pizza because other people do it. It's just that the job given to him was to produce milk only that's why he produces milk but that's doesn't mean that he can't bake pizza or grow wheat outside his line of work. It's like working in McDonalds. You are hired as a cashier only and not make the burgers but that doesn't mean that you don't know how make burgers. The job of making the burgers was just given to others so the labor is split.
It's a little weird that all teachings of economics tend to start with Adam Smith when economic thought can be traced back so much further. There are writings from some 700 years before Adam Smith came along (the 11th century) from Al Ghazali in Persia saying the same things about trade. I hope this series isn't going to just focus on the economic theory of the English speaking world like Milton Friedman and Keynes and ignore all the stuff coming from places like France, Sweden, and Germany.
“Irrational exuberance” is a phrase used by the then-Federal Reserve Board chairman, Alan Greenspan, in a speech given at the American Enterprise Institute during the Dot-com bubble of the 1990s. The phrase was interpreted as a warning that the market might be somewhat overvalued.
I'm still hoping this series convinces me that macroeconomics is anything more than untested hypotheses and unfalsifiable statements. Not for nothing, but physics has set the bar pretty high. I have yet to meet a student of macro who doesn't buckle under the request for any data which backs up their claims. If the field lacks scientific rigor, then that's fine. I just want to know. If it's not melodramatic hyperbole, then I am willing to swallow my pride and learn these methods of describing the world.
Sean Ehle Physicists can control variables, macroeconomists can´t. Also you must have met pretty shity macroeconomist, most of the theory they have teached us was showed with the real data. I don´t think the problem is lack of data but the diffierent explenations.
NarwhalHats Considering that Crash Course is made with the idea that it will (very likely) be used in schools as a teaching aid, then yes, their viewers are children. Or at the very least, part of their target demographic is children.
NarwhalHats Have you seen any other series on this channel besides this one? ALL the videos are like this so I don't know why you try to pick on this one. Crash Course knows what their target demographic is
I hope that the people with whom I have spoken were poor communicators, not for their sake, but because they deflated my interest in this field. P.S. sorry if I implied any rank or priority to the many fields of human effort.
The logic taught here makes so much sense when you play a game like Anno 1800! You have to decide if it's what's more efficient to manufacture or trade.
JakeHMW Capitalist reforms in China and India have been responsible for the greatest uplift of people out of poverty in history.... Marxist reforms have been responsible for some of the biggest massacres in history... As for Marxism itself: Its differentiation of classes is completely arbitrary. It fails all moral frameworks. Concepts like the "alienation of the worker" ignore agency, social mobility and freedom. Finally, it has utterly failed in practice and as a predictive model. The countries with the freest economies tend to have the healthiest, wealthiest, happiest people with the most social mobility, least income inequality, least amount of pollution ect. ect.
JakeHMW "It eradicated homelessness, unemployment, and illiteracy " It didn't. China is one of the biggest propagandist countries in the world. Its incredible you can seriously claim this. I would need some evidence to even consider this amazing claim. How can you even reconcile this with the fact that more people were lifted out of poverty in China and India then has ever been done in history after their respective capitalist reforms? "Doesn't the decline in entrepreneurship and the middle class in America hint at a growing inequality and concentration of capital? " Certainly. America has become far less capitalist with ballooning government debt, crushing regulations, and crippling government programs like the War on Poverty, War on Drugs, and the War on Terror. America is not a very free economy compared to other industrialized countries. "I'd advise you fact-check your work. " Right back at ya.
formsMostBeautiful You're absolutely right. During the 1970's, China virtually eliminated poverty, starvation, and death. Oh, wait, it FUCKING DIDN'T AND MILLIONS OF MY COUNTRYMEN STARVED TO DEATH. That's right. I almost forgot! The Cultural Revolution resulted in one of the worst famines in human history. People like you are literally worse than the Nazis, because while they have been defeated, you're still on the internet spewing literal shit everywhere. The deaths during the Cultural revolution is denied not even by the PRC government, although it apparently is by hipster Communists shitposting from their Iphones.
JakeHMW I might be naive but I think they'll give at least a semi reasonable episode on Marxian economics, besides I don't think that the aim of the series is to dive straight into 'Das Kapital.' If I want a simplified look on Marxian socialism I'll just listen to a lecture of Dr Richard D Wolff(brilliant man by the way.) Also regarding the countries resisting imperial capitalism, a lot of these countries are already capitalist like Cuba which in reality is a state capitalist country*. Also your statement that they are burgeois economics seems a bit dismissive, why do they have a Karl Marx head on the desk then? * The asterisk is for anyone who'll question the fact that Cuba is capitalist in nature, here's a comment I made ages ago which explains the situation: 'Yes indeed that is not socialism, socialism basically means that the means of production are owned by the workers, it is a very simple definition but one which needs further explanation in regards to the question of ownership of the economy. Social safety nets are not socialist as they do not adhere to any way to socialism, many incorrectly ascribe such methods of socialisation to socialism and then point to Scandinavia and call it a socialist success, quite incorrectly. Worker co-operatives are socialist, and a system that promotes such development is ultimately socialist or at least allows or endorses socialism. Regarding mix economy, what many people fail to realise that a mix economy is not simply a mixture of socialism and capitalism, it is a mixture of socialism, private capitalism and state capitalism, sure the latter two are both capitalistic but they do warrant a distinction due to a lot of people incorrectly believing that state capitalism (when the government owns a segment of the economy) is socialism, it is not. USSR following from this was a heavily state capitalist country, not much private or socialist, the US was the reverse and Nazism, Fascism were actually a synthesis of state capitalism and private capitalism, but it was important for them to exclude socialism as they did. Spain also falls on the same paradigm but it has a greater emphasis on socialism via worker co-operatives like Mondragon... So in short socialism is refers entirely to the economy of a country and does not include social welfare.'
mergele1000 The picture of the asian labourer was pretty obvious, but a sentence or two on this topic couldn't hurt eiter. I hope for an episode on this and will be very disappointed, if it will not happen.
mergele1000 It comes from how much land, labor (workers), physical capital (factories, machines, ect.), human capital (skills and knowledge), and natural resources you have. If you take the combination of these resources you can determine exactly how much of anything you have the potential to make. They made the example that America produces more airplanes and less developed countries make more shoes. America has more capital necessary to make technologically advanced airplanes and the opportunity cost of making shoes instead is lower as a result. Which is why a developing country like Vietnam that does not have the ability to produce many airplanes would have a much higher opportunity cost in doing so, and are much better off specializing in shoes instead - thus creating a comparative advantage.
Between countries with different tecnological, infrastructural and social developement levels it is obvious. What I actualy meant (but failed to say) is more like: "Would there be comparative advantages between smiar developed countries, and where would they come from?"
mergele1000 Now you're getting somewhere. If you have two identical countries with exactly the same factors of production (5 resources I stated above), no comparative advantage of any kind actually exists because the opportunity cost of every good would be exactly the same. However in reality there are no such identical countries in existence, so whatever differs between each countries factors lies their advantages. For a very simplistic example, ignoring what the second product would even be: America has much more land than England. Both countries want to consume corn, but corn is a very land intensive product. Since America has much more land then England to work with, we would expect to find that America would have a comparative advantage in corn.
Very happy that Crash Course has begun a course in Economics; its a shame that i finished my Economics A level a few months ago, none the less this stuff is imperative to anyone new to the subject and is explained beautifully. I am sure my Economics teacher will use this in his lessons.
Politicians do what they are told by think tanks that are the mouth pieces of investment bankers and corporate CEO's. They only have to con themselves into office after that it's just helping the rich get richer.
*Main outtakes of this lesson:*
1) Economics is the study of scarcity and choices. We have limited resources, so we need a way to analyze the best way to use them.
2) Significant sustained increase in people's lives happened after _Industrial Revolution_.
3) Adam Smith concluded that _division of labor_ made countries wealthy.
a. Analogy: one pizza takes few people to be created. One prepares ingredients, another puts it in the oven, another one puts it in the box. This division makes each worker more productive, since each one is focused on a thing they do best and they don't need to spend time switching between the tasks.
b. Without _specializations_, if you want something - you have to make it yourself.
c. So if you are good at producing something - specialize at it and then _trade_ with others.
4) Production Possibilities Frontier (PPF) shows different combinations of two goods being produced using all resources efficiently.
a. Every possible combination inside the curve is inefficient. On the curve - efficient. Outside - impossible.
b. The country that can produce more goods of one kind (per time) than another country is having an _absolute advantage_ over another country in production of those goods.
c. _Opportunity cost_ is a cost of production of good, measured in losses in production of another good.
d. Country that can produce good with cheaper opportunity cost, has _comparative advantage_ over another country.
e. Individuals and countries should specialize in producing things in which they have a comparative advantage and then trade with other countries that specialize in something else. This trade is mutually beneficial.
5) If there is one point where economists agree it's that specialization and trade makes the world better off.
6) *Self-sufficiency is inefficiency*
+Сергей Галиуллин Thank you! That was very helpful!
Thanks a lot!
god bless you
Сергей Галиуллин Can you please please do this for all videos?
Thankyou so much.
This series has already covered everything that I studied in a whole term of economics
"Self-sufficiency is inefficiency." I love it. I can't tell you how many times I've tried to explain this to people. We humans are better off when we collaborate then when we try to go it alone. We're all in this together. That you drew this lesson from Adam Smith, one of the laissez-faire heroes of many of the people to whom I have to keep trying to explain this, just makes it even better.
Matthew Prorok If you're saying you intend to take an argument about the efficiency benefits of specialization as a ringing endorsement of socialism or socialistic public policy, I'll just tell you to stop where you are: it's a pure non sequitur on your part to so conclude.
Of course not. It's not an endorsement of socialism, or socialist policy, but of *societies*. Any form of social organization is going to promote specialization; the whole of human history should give plenty of evidence of this. Humans work better in groups than they do alone; resources are used more efficiently by people working in concert than in isolation. Which specific social structures are best at promoting that is a much bigger discussion, of course. It's more an argument against anarchism than for socialism.
Matthew Prorok Ok, then, that makes it clearer--in that you falsely assume anarchism is anti-social/anti-society when it is merely anti-state.
Considering that the state is how we've organized societies for quite some time, that's not necessarily a relevant distinction.
Matthew Prorok Sounds like you didn't pay much attention to the CC WH2 video on civilization. You don't need a state to have a society.
So basically it is like the human body; each individual cell working by itself to survive is highly inefficient and ineffective but as soon as you put these cells together to make up a system called human body they work in harmony as a single organism to increase efficiency and become allot more effective. This can also be seen in ecosystems; and how nature operates and manages efficiency.
Slime molds popped into my mind
It's much easier to understand when compared to something you already know :D
There is one point to be considered and I was quite disappointed they didn't mention it:
Work can give your life meaning, making you feel like you are contributing something good to humanity. For example: You make Pizzas, you feed humans and make them happy. Your product, the pizza will make you happy every time you finish one and you see your product.
However specialization can make you loose your sense of purpose. After all, you are only producing a tiny fraction to the final product, and that can make you forget what you are working for. Which is feeding ppl and making them happy.
This can result in people hating their jobs, since specialization is efficient, but it makes you loose your sense of purpose.
Traditional economic assumed that human chase benefit, not happiness. It might not work well in individual scale, but should be quite okay in large-scale. I could believe that most of pizza makers in the world do their job because they can earn and pay their lieves - happiness came afterwards but not mandatory.
Abhishek Sehgal Ah, yes! Diversification really is an important & integral principal of our planet Earth's operating system and perhaps in general. Thanks for identifying and reminding me of it.
"If you wish to make an apple pie from scratch, you must first invent the universe."
"Self-sufficiency is inefficiency" -- That quote is spot on.
It rings true in the world of business, leadership, and it is applicable to life as a whole.
surely self sufficiency can be be achieved without inefficiency? I mean, is it really that clean-cut?
Pearl Playdinn
It isn't. I believe it is a matter of the *level* of self-suffieciency one aspires for. Defining yourself as self-sufficient is contrary to reality.
Nature itself is not self-sufficient, much less human beings, or any complex system that may be established by them.
Albania is proof enough of that
If the country was divided by itself (the rich and the poor, the industrialized and the undeveloped, shoe making complexes and airplane complexes, etc.) self sufficiency can be efficient BUT just as you know people can move from each location (and other factors), making self-sufficiently inefficient in the Information Age.
This is flattery for people with no agency.
As someone who has never formally studied economics before, I found that PPF graph and Mr. Clifford's explanation really helpful for understanding why it's beneficial for countries to trade.
Adam smith actually posited that while increased specialisation would make economies stronger and more productive, it would make the lives of workers more miserable. Think about it, the artisan shoe maker who crafts shoes by hand has a much more fulfilling job than the factory worker who operates a machine to put the plastic caps on shoe laces. This is a hidden, unquantifiable cost of specialisation. These sorts of hidden costs are why economic models fail to describe the world in a realistic manner. I really hope they talk about the limitations of economic models at some point.
Zach Gerstman so you mean this system makes jobs unbearable since there is no variety in what the workers do, right?
@@djeieakekseki2058 I think specialisation is a more macro term for division of labour which the guy was really referring to. Yes using the division 0f labour method creates job dissatisfaction it also creates less occupational mobility and in a macro sense can lead to structural unemployment however in a micro sense a method was found and applied to factories where after a few hours workers switch jobs so that they become less bored
thank you for mentioning this i got so annoyed at hovv they omitted this very important fact
maraima ski yeah then I agree with it. Basically corporations are mostly the cause specialization, right?
@@djeieakekseki2058 yes i think so
Is it just me or did their audio seem a little out of whack at times? I wonder if maybe both mics were picking up one person sometimes?
Gen Doukeshi Nope. Hot mics everywhere. I understand it can take a little extra time to balance the levels of two mics, but the effect of this issue should not be easily noticed by a novice in the field (me). C'mon, CrashCourse , your budget has to allow more than this. If it's a problem of time, I can wait a few extra hours for my dose.
Gen Doukeshi In particular I thought the volume when Adriene was alone on camera for the first time was much lower than the cut directly thereafter.
NNDesign I think it's mostly because it isn't filmed in their Chad and Stacy Studio but instead in UA-cam Space as they said in the first video
Gen Doukeshi Oh cool, I thought it were my speakers starting to die on me.
NNDesign let's not get nuts with the money.
This series is great, but could Mr. Clifford please speak a little slower?
kiyugbkuyginoiupepoauisd,aodiyuasdadasuyh! Why can't you understand?
NO, they want to keep hyper high school students engaged in learning. I'm keeping up. Let's go.
Hi, you can adjust the speed on settings. On the video, you will see right next to subtitles/closed captions symbol. The Gear symbol you can adjust the speed - click on playback speed.
I am watching this on 2x anyways, so who cares!
@@espartanam The only problem with that is that the lady speaks a little slower than normal, so if you slow it down then she becomes unbearably slow and if you keep it normal he's a bit too fast.
This is a refreshing choice of topic. After watching the first crash course economics, I thought the second ep will be on micro-economics stuffs like demand and supply but a straight dive to comparative advantage is surprising and refreshing.
I know, right? Textbooks usually direct you straight to the demand and supply side of things, which I feel, is a slow pace chapter
HeyItsLavie Thing is, this is supply and demand. But with a shot in the ass. Party A is good at foo, and party B is good at bar. So they get better at foo/bar and invest less in bar/foo. This fluidity means that the market reacts to shortages and surpluses organically.
Qermaq yes of course, everything in economics is related to supply and demand. What I meant to say was that it's nice to see that they've jumped right into specialisation to ease people in before handing them concepts like price elasticity of demand and what not which I find to be a slow paced chapter
Damn the audio was TERRIBLE in the first minute
They each had their own mics, which were picking up each others voices (but one slightly after the other), and that just messed with the audio.
Stefano Chua thought my expensive earpods broke🤨 was about to complain
I thought it was my own audio for a sec and kept adjusting it wondering why I had to in the first place
you have a lisp like i do Jacob. this gives me hope for my career in public speaking
+Tena Gordon Way to go dude! Keep it up! Love your body. It will never change but your attitude can.
Well that is false. Haven't you ever heard of plastic surgery.
I didn't notice until now.
Yeah, I didn't even notice. As long as the content is interesting I don't think people will pay too much attention to speech styles. UNLESS ITS TOO FAST
Trade between two nations that have a comparable level of development is good for both, yes.
However trade between a richer nation and a poorer nation, if unregulated leads to the less developed country being left unable to develop.
Think about it.
You have 2 Countries A&B, whose citizens interact economically without any government restriction.
If country A has infrastructure (factories) and country B has natural resources and they are trading freely, country A will import natural resources from country B and export industrial products to country B. Country B cannot develop an industry of its own, as its products would be inferior in every way to country A`s. They only possible advantage they could have is cheaper labor. But then again, why would n`t workers from country B go and look for a better life in country A? Remember, no government restrictions. And why would country A`s enterprises relocate from country A to country B when B`s workers are coming to them?
This is basically what West Europe (A) does to East Europe (B). It`s what the Global North (A) does to the Global South (B).
Although I do like the study of economics I would really like to see ChrashCourse do a series on philosophy (and not only the Western part) - I know some philosophers have appeared in the history-series, but to take a more direct focus would be pretty cool at some point.
Martin D. Petersen I would love to see a philosophy course as well. Many people see crash course as a study aid, whereas it really aims to help offer free education to people. The goal isn't to adhere to standards, as can be seen in the copyright and intellectual property mini series.
Martin D. Petersen You should really check out the channel "school of life". They make a lot of short and concise videos about philosophy and it's really great. Also, if you want something more in-depth you can check out Gregory B. Sadler's youtube channel, where you can find entire lectures about all sorts of things like an intro into philosophy or lectures about certain topics like Existentialism, Phenomenology or the core concepts in Philosophy.
Check out the school of life channel if you want videos on philosophy.
The pretty good Gatsby I found that School of Life is rather arrongant in it's views. What I mean is, they dont really teach philosophy as much as they teach THEIR philosophy (what they consider to be the correct philosophical ideas). I agree with them on most things, but a teacher should teach about the subject, and not that much about their views on the subject. Also, they sometime go really wacky with their views, like in the video concerning why are some countries poor and others rich. Most of that lecture is very good, but the moment they touch on religion thay start formulating some VERY weird ideas. When people disproved those ideas, they just replied with "every rule has an exception"... Really?!
MarcianusImperator It also doesn't have the comments section online. Could you explain to me what the weird ideas were? I think I need more context in order to agree or disagree about this >>
Dang, my AP Econ teacher makes us watch videos as part of our homework. If only more teachers were like that xD
my teacher makes me to watch history series of crash course, lol
Haha, my AP Chem teacher used to do the same but with Tyler Dewitt if I remember correctly, she didn't believe in homework but I'm not complaining!
My teacher makes me watch movies for stock markets...
Top Compilations I recently seen a stock-market themed film called "Wall Street"
Recommend it if you haven't already seen it.
Wheatley lucky. I watch these on my free time, and I don't get any credit for it. I do like watching them, though.
I never had any economic classes in school so I'm really excited about this. Can't wait to learn more
I'm in love, with this video and with economics. Especially this concept, which you see all around and uses everyday.
Dammit, the Mongols are everywhere!
You can never escape the Mongols!!!!!
Natalie McCarthy Mongols for the Mongol god!
I am a mongol so be careful i dont step on you on my way to work
Christian Neihart They are not the exception on these videos
You cannot escape your Mongol overlords!!
I like Adrienne. She's got the same enthusiasm John has in these CrashCourse vids which is amazing
Wasn't sure how this Course was going to go but after this episode I'm solidly rooting for you. Informative, engaging, and clearly presented, well done. I wish this was around way back in the dark ages when I took high school economics.
I had a couple of economics classes during my time in university, and I'm really happy to see the critism of this video is honestly directed at the content at not at the pace and style with which the models are introduced. I thought this was moving fast for many people, great to see everyone following along!
I just wanted to say thanks. I really like this series so far, and thank you for caring about the quality of view rather than the quantity. This series is a perfect example of all the right things about Nerdfighteria. DFTBA!
I first came across Crash Course in my junior year biology class. We had Hank as a host. Man, what a joy it was! I now use Crash Course whenever I'm stuck on a topic. They explain it so well!! (Crash Course also helped me get through my undergrad course).
This episode was much better than the last one. The fact that when telling a joke the actors stayed at the same pitch and volume as when they are not telling a joke definitely helped.
Thanks for stressing that that was a highly simplified model to understand a concept, because so many people fly off on a rant when i try to explain this. Other factors such as strategic importance of a domestic aircraft industry is why protectionism can come into play, distorting free trade
I am really enjoying this series so far, and the idea of "The Runway" is brilliant for explaining graphs. Almost feels like something you'd see on BBC or CNN when they discuss economics
Dear Economics,
That's cute.
Love,
Physics.
Isabella Solis Dear neurobiology, physics, and anthropology,
You can't do anything efficiently without me nowadays
Love, computer science
Evan. Physics... u mad bro?
Evan. Awwwwww physics is soooo cute. But please physics, go to your room when the economists are talking, ok sweety?
Evan. Dear Physics, you would have no funding if economists hadn't decided that the opportunity cost involved in your research was worth having people start at two slits for their whole life.
Sincerely,
Economics.
+unseethed Dear Economics: You and everything else in this universe only exist because I was applied. Sincerely, Physics
Amazing Channel!
Having the ability to learn remotely and freely usually goes unappreciated.
I would like to thank you!
Doesn't this guy resemble Mark Cuban?
That's what I keep thinking!! Glad I'm not the only one lol
It's not Mark Cuban?... why am I listening to this guy
reuben jake Yes, I thought I was the only one
he is mark cuban u just cant see it because of the ac dc belt
Yup
It is kind of amazing how these concepts also get applied in everyday life. Specialize in something and trade with other people having specialization in different fields and both can achieve growth in regular life too. Thanks Guys
No mention of David Ricardo?? Unless you are planning to do that in the next videos, I find it odd that you didn't mention him, since he had more to do with that topic than Adam Smith.
Very well articulated concepts and flow of narrative by the producers of the series.Keep up the good work.
Damn. I can’t imagine not being a native English speaker and trying to understand this. They speak sooooo fast! Slowing it down to 0.75x makes it better for those struggling.
halo i'm from indonesia.. i'am a economic teacher senior high school. I enjoy learning economic material from this channel. Very insightful, thank you
Thank you for simplifying this enormous subject! As a music teacher who has to teach this, it really makes me happy.
Love the design! Moving around the graph to highlight pieces of it was fantastic. The Runway, Ha! Thought bubble... still amazing. Keep up the good work.
Nicolas Weiss Thanks Nicolas, appreciate the love! -Thought Café James
"Countries who have opened their doors, like Japan..." Well, I wouldn't quite word it that way...
+SirRandomMonkey What makes you say that?
Sierra Davis Japan didn't "open" their doors so much as the US Navy broke their doors down. Research Japan 1830-1860, key word: Matthew Perry
SirRandomMonkey Ah, yeah, I see what you mean. I didn't know you were talking technicalities. XD
+Mister 4 Eyes Knock Knock, it's Donald Trump...
Zoe Merced Mother of God, keep him out at all costs! XD
I don't know about you guys, but I want to try some of that Mongol pizza. We need more Mongols in the US to make Mongol Pizza!!!!!
***** can i have some of your pizza please?
***** What is in your pizza, I must know!
kingofprussia17 You sir are enormously confusing. You call yourself the king of Prussia, which doesn't exist anymore as it is mostly in Poland. You have the image of the Union flag as your profile picture, perhaps indicating you're British. But you also speak as if you're American as you said you need more Mongols in the US.
Consider me bamboozled.
Petey T I'm American who is mostly German and I like the Union Jack, a little different then the stars and stripes. I just want Mongols here for their pizza, good old western imperialism. lol
***** well everyone starts somewhere when it comes to geography, so you're not dumb. Prussia was the country that united most of the rest of the German lands about 140 years ago. It was a highly industrialized military state and it provided the framework for Germany between 1871 and 1945. After 1945 Prussia was almost completely stripped from Germany and granted to Poland in punishment for starting World War 2, and to create a buffer zone between Germany and the Soviet Union (Russia). All of the 12 million German inhabitants were kicked out or killed over the next few years. And so today Prussia doesn't exist at all anymore, so it's completely understandable that you don't know where it is.
Poland is geographically near the centre of Europe, it is East of Germany, West of Belarus, North of Ukraine, and South of Scandinavia. A quick google map check would show you the whole area.
5:42
How could you possibly calculate one single opportunity cost for producing an extra plane? It depends on where you are in the curve. This can also be thought of as the derivative of the curve.
For example, look at the US curve they give us. Let's say the US spends all of it's resources making shoes. Then, let's say that the US wants to allocate just enough resources to make 1 more plane than it currently is(currently not producing any planes). Then, the point on the curve would shift up 1 unit, and over to the left until you crossed the ppf curve(the intersection where everything is optimal). When the curve is steepest, it actually makes a lot of sense to produce more planes, because the opportunity cost is very low.
Jake Whitton is it possible for you to explain this in layman's terms? i'm attempting to learn economics (through reading, I'm watching crash course out of interest as to where it ends up leaning politically), but i've always been a bit shit at maths and graphs. if not possible without distorting the original point then nay worries
Jake Whitton tl;dr
..is that directed at me? if you're asking someone to explain something the question deserves a bit of context
daisy kirtley DOn't worry about it. The curve is arbitrary. There's no such curve in real life, and the points they made in the video is good enough. If you're worried of derivation of the curve, it's the curve gradient or slope and any given point.
daisy kirtley Sure. I'll try to explain it simply.
Imagine that you have 90 workers. Currently all 90 of those workers work at a factory that produces cars. Across the street, there is another factory that produces computers, but nobody is working there currently. The owner of the car factory wants to make more cars per day, so he hires more workers. However, he notices that the factory is already operating at full capacity. *Simply throwing more workers(resources, as the analogy goes) doesn't result in a worthwhile increase in yield.* So, because he isn't getting much out of these extra workers, he fires them.
Then, the computer factory across the street sees those workers and decides to hire them. They all get the proper training and begin making computers. Now, the computer factory is making computer at a slow, but better than stopped, pace. Now, the owner of the computer factory decides to hire even more workers, to try and maximize yield. *Because the factory can benefit from more workers, it is wise to hire more workers, because the cost of paying more workers will be offset by selling more computers.* After a lot of hiring, the owner of the computer factory runs into a problem. Hiring more workers doesn't generate enough additional yield to pay for their salaries. The owner of the computer factory is in the same position as the owner of the car factory was.
In short, you can't make a blanket statement like "Every time we hire a new worker, it will allow us to make 2 more computers per day." Whether or not that statement is true depends upon how many workers you currently have and how many you could theoretically have.
Translating this into talk about nations, let's imagine the same situation, except you are trying to figure out how many workers should be in both factories.
You have 1000 workers to disperse among the two factories. You start by placing 200 in the computer factory and 800 in the car factory. Now, you can shift workers as you see fit.
Let's say you were to move 100 workers from one factory to the other. Would it be smarter to take the 100 workers from the small computer factory or the larger car factory. You notice that adding 100 workers to the car factory would increase the yield by 5 cars per day. If you added those same 100 workers to the computer factory, you could increase your yield by 50 computer per day. Obviously, the smart thing to do is to take 100 from the car factory and put them into the computer factory.
The opportunity cost is simply what you lose out on if you send the workers to the computer factory rather than the car factory. If you send 100 workers to the computer factory, then you lose out on the 5 extra cars per day. However, you gain the 50 computers per day, so it ends up being a smart trade.
Some notes if anyone needs em!
-Most historical events like wars and disputes can be explained by economics, by simply trying to understand who wanted what
-Progress of humanity can be mapped using: life expectancy, child mortality, income per capita
→ industrial revolution was the first ever increase in the quality of life
-Adam Smith concluded that it was the division of labor (specialization) that made countries wealthy, but it’s trade that makes them well-off
-Production possibilities frontier (ppf) graph which shows different combinations of 2 goods being produced using all resources efficiently
→ anything inside the ppf is inefficient, anything on the line is efficient, and everything outside the ppf is impossible
-If a country has the potential to make more of something, they have an absolute advantage in production
-A comparative advantage is when a country has a smaller opportunity cost → meaning that with each product 1 they make, they lose less product B
-Self-sufficiency is inefficiency and inefficiency can lead to poverty
For anyone doing the worksheet (you know if it’s you)
0:25
1:00
1:11
1:25
1:38
2:55
3:20
3:47
4:02
4:04
5:10
5:15
5:31
5:42
5:51
6:00
6:34
6:52
7:23
7:45
Hope it helps👍
wow. you’re amazing
Thanks a lot for sharing the knowledge with us. You guys are really adding the more things in our life which couldn't have happened of we have not gone through your crash course.
Completely missed an opportunity with 'Pizza Hun' on that one.
B-but.. the mongols.
I think you're all doing a great job laying this out in a clear and concise manner. I look forward to subsequent videos, as always. :D
5:49 as you can see on the graph. You can also determine who's better at what just by looking at the difference of PPF on each axis. For instance, since US can produce 400 more planes than China, but only 200 more shoes than China, US is better off building planes than building shoes. Additionally, keep note of US = 1 plane/-2shoes and 1 plane/-8 shoes. You can also flip the fraction around, along with the integer, to make it into 2 shoes / -1 plane for the US, and 8 shoes /-1 plane for China when looking at the opportunity cost, or the comparative advantage that each country has over the other in term of production of certain goods.
Since China can produce 8 shoes at the cost 1 plane, and US can produce 2 shoes at the cost of 1 plane, thus, China should specialize in shoes while US should priotize in planes production. You basically are able to produce 6 more shoes if China were to take care of the shoes production than US relying on itself ;to produce both shoes and planes.
I will be student teaching economics soon (I haven't taken an economics class ever) and these videos are SUPER helpful, and hearing it straight from an econ teacher makes it even better!
Mongol pizza??? I sense a Green...
He's the exception
I learn so much from these shows. Thanks particularly for explaining the concept of specialization and trade. Having been into the reenactment scene for a bit and trying to do it all myself on one or two products, yes. I totally agree.
Keep the lessons coming!
I am attempting to work out how self-sufficiency is inefficient in my particular case:
Recently I started making fertilizer for my garden. It is made using materials I already own, but would normally throw away (kitchen-scraps), so in this way I am getting more value for the money I spend in groceries. Alternatively, I could buy the fertilizer from a specialized producer for x-amount of my income dollars and this would save me the time and effort it takes to prepare the materials, but i believe (estimate) the time it takes to make fertilizer is < the work-hours required to pay for it.
Is self-sufficiency inefficient in this case? If so, consider this: If I specialized in the practice and sold the product, does this balance your concept?
Hell of a big gamble deciding to get new presenters/teachers. I can't stress enough how much it matters to me personally to have someone I can learn from, teaching.
And from where I'm sitting, these two are.. perfect.
Bring on economics!
If you guys could just slow your rate of speech just a tad that'd be great.
Summerneverdies Ikr? As a non-native English speaker, at some points it’s hard to follow. So yeah guys, slow down a little.
slow down the speed in setting option.
That would be inefficient.
you guys and the entire crash course team gives me much hope in a word saddled with the high consumption of irrelevant information
im very grateful that u still find it worthy to make it your job to educate me and other people who want to learn the things that really matter
thank you
william, from Ghana
I bet that Mongol Pizza must taste... exceptional!
Will you guys look at different types of economies as well as different countries and their perspectives and ideas please?
I wish these videos existed when I was studying economics in High School! You guys are doing such an amazing job
I thought I'd chime in. Volume, perfect. Voice speed, perfect. Btw, viewers, as already commented by someone, all of these are adjustable on your device. I am loving it and so thankful for this course.
Sometimes "inefficiency" is a good thing when it makes systems or societies more resilient
I am 24 and I have understood for the first time ever the concept of trades. Before you come at me, I am the guy who is busy enough to design applications and website the likes of youtube so y’all can learn about all of this as well. Thank you very much Crash course
"Specialization and trade makes both parties better off." That is a subjective statement. It depends on who you are asking.
not really
Great video. Interesting and accessible. I only just started looking into learning more about economics and found this series. The first video seemed a little dull but this one has a much better pace. Looking forward to seeing more!
Desperately watching these videos 9 hours before Economics exam due to no revision.
You guys are awesome I have an economy test tomorrow all i gotta do is watch your videos your touching all the subjects
"Bring it on." -Physics
= )
0:03 I confirm your suggestion that complex fields of research are often expressed with a hypercomplex vocabulary.
When is the next episode going to be released; it has been about two weeks, since the last episode?
This was really good! I watched this out of curiosity since the thumbnail looked good and now I’m going to finish this to set my basics hehe!! Thankssss
that "ACDC" belt tho :) respect!
This is great. Keep them coming. I have a degree in Economics but it's still valuable to get a (for me) new and clearer explanation of things, which I think you succeed in. This helps to keep my overall skill or knowledge level high. Thank you
when you parents wanna be hip
I'm an undergrad just refreshing the topic, and these two teaching the course are making it so hard to get through with out wanting to click off.
I guess you guys forgot to give credit to David Ricardo for the Comparative Advantage model
Marcial Amaury Pineda Moquete agree
I love econ and crash course. Glad to visit old videos and see the nods to pizza john
I like the show, and I understand you do this, but please stop saying economics is boring. It seems annoying to those who think it's fascinating..
Raph Gealon Yeah, it's weird that they think that countering anti-intellectual sentiments is necessary for people watching educational videos on youtube. But maybe they're thinking of a general audience of school kids, where anti-intellectual attitudes are more common.
Dave Power #6 Their target audience might be high school students. So from an economic perspective, the trade off is catching more anti-intellectual audience over intellectual audience.
Thats exactly what i was thinking.
Raph Gealon The john oliver effect. He keeps saying subjects are really complicated when they aren't or that they're really boring when they're not. I don't know who he thinks his viewers are. ADHD 8 year olds?
Yeah. IMO, basically all they have to do to make it interesting to everyone is relate economics to the decisions you make in everyday life and voila it's interesting. Hopefully they do some of that in later episodes.
my head was spinning at the part where you said i hope your head is not spinning ... and you talk so fast...the man that is
Concepts in this lesson: for me or whoever wants it lol
(ib someone in the top comments)
1. ADAM SMITH- specialization made countries wealthy aka the division of labor
+
What is specialization- the process of concentrating on and becoming expert in a particular subject or skill
so basically everyone has there own jobs to complete to get the job done faster. (assembly line type situation)
makes people more productive
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Benefits of Trade-
-model- PPF Production Possibility Frontier - shows the different combinations of 2 goods being produced using all resources efficiently
r e a l w o r l d i d e a - to understand that there's trade offs between producing 2 or more goods.
absolute advantage- the ability to produce more of one good
% still need trade % *jacob speaks too fast for my tiny brain* ^I''m 1/2 way through my economics course and am trying to understand things fully up to where im at anyways rip^
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Countries with lower opportunity cost for producing the good have the "comparative advantage"
For the us for each additional good they produce they lose 2 of another.
cHinA hAs a LoWer "opportunity cost" for shoes meaning they have the "comparative advantage".
COUNTRIES WANT LOWEST OPPORTUNITY COST
g o o d l u c k w i t h y o u r e c o n o m i c s c o u r s e
let me get a rip in the chat okay bye
"Take that physics, we're comin' for ya.."
That was awesome!!
i know this question might never be replied to, but here it is: Are you sure specialization is truly more efficient? is there some externalities that might have been missed. The last two days, I have been building my own forklift from scratch using scrap. As I work, I realized that I am learning many new skills that not only I can apply to make my life better and help me do other things more efficiently, the fact that I am learning new skills means I also become better at learning and become smarter! Apply to this video's example, if you have to make a pizza from scratch, you would learn the skills you need to survive in a zombie apocalypse as well as improving you ability to learn and become smarter. If this is true, I fear that over specialization means people rely on others for specialized skills, and have to learn less and less skills. Eventually, this mental decline would result in people being so dumb that they couldn't make pasta ( just like in 2oolander ) and being conned by some fast talking salesman into electing a buffoon for President .... OH WAIT
jiunn wong Interesting arguement, and partial truth to it too! However I wouldn't ultimately discredit specialization. The U.S. participates in specialization within the country (ex: majors in college, clubs, specialized jobs, etc). Perhaps certain countries are limited by the knowledge they only can obtain in their geographical location. Because of specialization, certain, developed, civilizations have become financial superpowers today. But specialization does come with disadvantages too, no doubt.
I don't think that's what it's saying. It doesn't say that you shouldn't learn new skills. The point is that labor should be split more efficiently. With their example regarding pizza, the person who specialize in producing milk doesn't mean that he does not know how to grow wheat or that he doesn't know how to bake the pizza because other people do it. It's just that the job given to him was to produce milk only that's why he produces milk but that's doesn't mean that he can't bake pizza or grow wheat outside his line of work. It's like working in McDonalds. You are hired as a cashier only and not make the burgers but that doesn't mean that you don't know how make burgers. The job of making the burgers was just given to others so the labor is split.
In the book Anarchy Works, there's a chapter about that in there...
"Self-sufficiency is inefficiency" words to live by
It's a little weird that all teachings of economics tend to start with Adam Smith when economic thought can be traced back so much further. There are writings from some 700 years before Adam Smith came along (the 11th century) from Al Ghazali in Persia saying the same things about trade.
I hope this series isn't going to just focus on the economic theory of the English speaking world like Milton Friedman and Keynes and ignore all the stuff coming from places like France, Sweden, and Germany.
I love them presenting classes i'm in
1:44 Green brothers spotted, ft. Craig
“Irrational exuberance” is a phrase used by the then-Federal Reserve Board chairman, Alan Greenspan, in a speech given at the American Enterprise Institute during the Dot-com bubble of the 1990s. The phrase was interpreted as a warning that the market might be somewhat overvalued.
I'm still hoping this series convinces me that macroeconomics is anything more than untested hypotheses and unfalsifiable statements. Not for nothing, but physics has set the bar pretty high.
I have yet to meet a student of macro who doesn't buckle under the request for any data which backs up their claims. If the field lacks scientific rigor, then that's fine. I just want to know. If it's not melodramatic hyperbole, then I am willing to swallow my pride and learn these methods of describing the world.
NarwhalHats Eh, that's matter of preference. I like the way they get excited about the subject.
Sean Ehle Physicists can control variables, macroeconomists can´t. Also you must have met pretty shity macroeconomist, most of the theory they have teached us was showed with the real data. I don´t think the problem is lack of data but the diffierent explenations.
NarwhalHats Considering that Crash Course is made with the idea that it will (very likely) be used in schools as a teaching aid, then yes, their viewers are children. Or at the very least, part of their target demographic is children.
NarwhalHats Have you seen any other series on this channel besides this one? ALL the videos are like this so I don't know why you try to pick on this one. Crash Course knows what their target demographic is
I hope that the people with whom I have spoken were poor communicators, not for their sake, but because they deflated my interest in this field.
P.S. sorry if I implied any rank or priority to the many fields of human effort.
Thank you! Specialization and trade, great!.
you guys are awesome! superLIKE!
The logic taught here makes so much sense when you play a game like Anno 1800! You have to decide if it's what's more efficient to manufacture or trade.
1:00 Is that Karl Marx on the desk behind?
Marxist economics episode confirmed!
JakeHMW
Capitalist reforms in China and India have been responsible for the greatest uplift of people out of poverty in history....
Marxist reforms have been responsible for some of the biggest massacres in history...
As for Marxism itself: Its differentiation of classes is completely arbitrary. It fails all moral frameworks. Concepts like the "alienation of the worker" ignore agency, social mobility and freedom. Finally, it has utterly failed in practice and as a predictive model.
The countries with the freest economies tend to have the healthiest, wealthiest, happiest people with the most social mobility, least income inequality, least amount of pollution ect. ect.
JakeHMW
"It eradicated homelessness, unemployment, and illiteracy "
It didn't. China is one of the biggest propagandist countries in the world. Its incredible you can seriously claim this. I would need some evidence to even consider this amazing claim. How can you even reconcile this with the fact that more people were lifted out of poverty in China and India then has ever been done in history after their respective capitalist reforms?
"Doesn't the decline in entrepreneurship and the middle class in America hint at a growing inequality and concentration of capital? "
Certainly. America has become far less capitalist with ballooning government debt, crushing regulations, and crippling government programs like the War on Poverty, War on Drugs, and the War on Terror. America is not a very free economy compared to other industrialized countries.
"I'd advise you fact-check your work. "
Right back at ya.
formsMostBeautiful
You're absolutely right. During the 1970's, China virtually eliminated poverty, starvation, and death.
Oh, wait, it FUCKING DIDN'T AND MILLIONS OF MY COUNTRYMEN STARVED TO DEATH.
That's right. I almost forgot! The Cultural Revolution resulted in one of the worst famines in human history.
People like you are literally worse than the Nazis, because while they have been defeated, you're still on the internet spewing literal shit everywhere. The deaths during the Cultural revolution is denied not even by the PRC government, although it apparently is by hipster Communists shitposting from their Iphones.
JakeHMW
I might be naive but I think they'll give at least a semi reasonable episode on Marxian economics, besides I don't think that the aim of the series is to dive straight into 'Das Kapital.'
If I want a simplified look on Marxian socialism I'll just listen to a lecture of Dr Richard D Wolff(brilliant man by the way.)
Also regarding the countries resisting imperial capitalism, a lot of these countries are already capitalist like Cuba which in reality is a state capitalist country*.
Also your statement that they are burgeois economics seems a bit dismissive, why do they have a Karl Marx head on the desk then?
* The asterisk is for anyone who'll question the fact that Cuba is capitalist in nature, here's a comment I made ages ago which explains the situation:
'Yes indeed that is not socialism, socialism basically means that the means of production are owned by the workers, it is a very simple definition but one which needs further explanation in regards to the question of ownership of the economy.
Social safety nets are not socialist as they do not adhere to any way to socialism, many incorrectly ascribe such methods of socialisation to socialism and then point to Scandinavia and call it a socialist success, quite incorrectly.
Worker co-operatives are socialist, and a system that promotes such development is ultimately socialist or at least allows or endorses socialism.
Regarding mix economy, what many people fail to realise that a mix economy is not simply a mixture of socialism and capitalism, it is a mixture of socialism, private capitalism and state capitalism, sure the latter two are both capitalistic but they do warrant a distinction due to a lot of people incorrectly believing that state capitalism (when the government owns a segment of the economy) is socialism, it is not.
USSR following from this was a heavily state capitalist country, not much private or socialist, the US was the reverse and Nazism, Fascism were actually a synthesis of state capitalism and private capitalism, but it was important for them to exclude socialism as they did.
Spain also falls on the same paradigm but it has a greater emphasis on socialism via worker co-operatives like Mondragon...
So in short socialism is refers entirely to the economy of a country and does not include social welfare.'
derpherpize
Replied to the wrong person....
Thank you for this. I find this to be a better aid in teaching the subject than my professor.
"[...] all of them working in harmony."
...of slave labor.
I'm really loving this show, just two episodes in and I already learned something I've never even thought of before!
And now the big question: Where do comparative advantages come from?
mergele1000 The picture of the asian labourer was pretty obvious, but a sentence or two on this topic couldn't hurt eiter. I hope for an episode on this and will be very disappointed, if it will not happen.
mergele1000 It comes from how much land, labor (workers), physical capital (factories, machines, ect.), human capital (skills and knowledge), and natural resources you have. If you take the combination of these resources you can determine exactly how much of anything you have the potential to make. They made the example that America produces more airplanes and less developed countries make more shoes. America has more capital necessary to make technologically advanced airplanes and the opportunity cost of making shoes instead is lower as a result. Which is why a developing country like Vietnam that does not have the ability to produce many airplanes would have a much higher opportunity cost in doing so, and are much better off specializing in shoes instead - thus creating a comparative advantage.
Between countries with different tecnological, infrastructural and social developement levels it is obvious. What I actualy meant (but failed to say) is more like: "Would there be comparative advantages between smiar developed countries, and where would they come from?"
mergele1000 Now you're getting somewhere. If you have two identical countries with exactly the same factors of production (5 resources I stated above), no comparative advantage of any kind actually exists because the opportunity cost of every good would be exactly the same. However in reality there are no such identical countries in existence, so whatever differs between each countries factors lies their advantages. For a very simplistic example, ignoring what the second product would even be:
America has much more land than England. Both countries want to consume corn, but corn is a very land intensive product. Since America has much more land then England to work with, we would expect to find that America would have a comparative advantage in corn.
Very happy that Crash Course has begun a course in Economics; its a shame that i finished my Economics A level a few months ago, none the less this stuff is imperative to anyone new to the subject and is explained beautifully. I am sure my Economics teacher will use this in his lessons.
Now if only anyone running for President would watch this video. Or take a basic economics class...
Politicians do what they are told by think tanks that are the mouth pieces of investment bankers and corporate CEO's. They only have to con themselves into office after that it's just helping the rich get richer.
You're a goof Bryce
Did you get what you wanted Bryce? :)
That was a pretty good explanation of comparative advantage. Well done CrashCourse !
Anyone else see his AC-DC belt???
He is a moron anyways lol
Kai Widman m
he has his own channel called AC-DC economics thats why
This is looking to be my favorite crash course yet .
Thumbs up
Ummmmm no. Physics still rules!
Awesome video.. loved watching and learning
I'd order me a Mongol pizza
Great job on explaining the concepts. Taking an online course, this is a great supplement to clarify much of the reading involved.