Combined I&S U1-3

Economic system

Framework a country uses to organise the production, distribution, and consumption of goods & services

Traditional economy

A system based around customs, history and beliefs, where economic decisions are guided by traditions rather than profit

Example: Inuits in the Arctic

Advantages of a traditional economy

• Focus on customs, beliefs and traditions

• Agriculture, fishing, hunting, bartering - natural

• More community based 

• Effective production & less waste

• Reap the rewards sowed yourself, control over the factors of productions

Disadvantages of a traditional economy

• Slowly disappearing due to the expansion of globalisation and modern industries

• Limited economic growth to adopt new tech

Command economy

System where a central authority (typically the gov) make all key economic decisions regarding the production, pricing and distribution of groups and services

Example: North Korea

Advantages of command economies

• Large-scale projects = social security (eg. education, healthcare)

• Helps with industrialization

• Stable economy

• Job stability; low unemployment rates: State-assigned jobs - secure jobs & source of money

• Less inequality

Disadvantages of command economies

• Lack of motivation for innovation

• Insufficient resource allocation

• Heavy gov control

• Struggle with inefficiency and corruption

• Less individual freedom for employment & personal freedom

• Less innovation

Market economy

System where production, investment and distribution decisions are guided by price signals, which are created through supply and demand

Example: United Kingdom

Advantages of market economies

• Increased efficiency, innovation and consumer choice

• Adaptivity and growth: highly flexible and responsive to changes in demand

• Freedom of choice of what to sell (free-enterprise, supply & demand system)

• Private, highly innovative

• Consumers drive the market

Disadvantages of market economies

• Creates a gap between the rich and the poor

• Environmental degradation

• Income inequality

• High unemployment rate at risk of market crashes

• High chance of monopolies

Mixed economy

A system which combines elements from all 3 systems (traditional, command and market)

Example: United States (strong private ownership & government regulation)

Advantages of mixed economies

• Exists because there is no best economic system

• Besta attributes from all 3 systems can be utilised in a mixed economy

• Mix of private/public sector

• Freedom of choice and ownership

• Gov has policies and subsidies to correct market faliures against market forces

Disadvantages of mixed economies

• Gov has ownership in some key industries: government intervention can lead to high admin costs, excessive regulation and inefficient public sectors

• High tax & debt

• Conflicting objectives

GDP

Gross domestic product

• Total monetary value of all final goods and services produced within a country’s borders during a specific time period (typically a year/quarter)

HDI

Human Development Index

• A measure of development = used by the UN

• Combines indicators of life expectancy, educational attainment and income into one measure
  Average of each of the 3 indicators: education, life expectancy, income

• High HDI = closer to +1 while a country with a lower score = closer to 0

MEDCs

More Economically Developed Countries

LEDCs

Less Economically Developed Countries

GNIpc

Gross National Income per capita

• Average economic output/income per individual in a country

• Develops total GDP by population

G20 countries

Group of 20 - countries with the largest economy in the world

• Includes China, UK, US, Canada ect.

SEEP factors

Social, economic, environmental, political

Development gap

• The difference between the rich and the poor around the world

• Measures how economically, socially, culturally or technologically advanced a country is

• Social indicators measure: education nutrition, health, leisure, safety, political and cultural freedom

• Economic indicators measure: GNIpc, GDP, HDI

Statistical tools used to measure development

GNIpc, GDP,  HDI, vehicles per 1000 people, life expectancy, mean years of schooling, and home ownership ect.

TFP

Total factor productivity

• Productivity of capital labour and capital resources

Why have some countries experienced increases in wealth?

• Technological advancements

• Differences in TFP

Scarcity

the state of being scarce or in short supply; shortage.

Why does scarcity force people to make choices?

• Wants and needs of the people are unlimited

• Resources needed to satisfy them: money, time, land etc are limited

• Thus countries must prioritise and make tradeoffs

South Sudan scarcity

South Sudan’s poverty and low wealth (4.98 GDP per capita) stems from governmental instability: conflict and displacement through civil wars between factions, famine, unemployment and the currency crash within the country.

Development indicators

Statistics which tell us details about a country

Social development

Standard of living and quality of life

Economic development

How wealthy a country and its people are as well as the quality/quantity of goods

Why is HDI used instead of GDP?

GDP can give a distorted picture = some countries are wealthy but are not very developed

Equatorial Guinea in 2023

HDI: 0.674 

GDP: 6,677.8 thousand

Costa Rica in 2023

HDI: 0.833 

GDP: 16,942 thousand

Why does Equatorial Guinea struggle despite oil wealth? 

Equatorial Guinea struggles despite oil wealth due to the corruption within the country, which are influenced by high-level officials who “engage in various illegal activities, including embezzlement and human trafficking”

How does Costa Rica achieve high HDI with modest GDP?

Costa Rica gives its citizens access to high-quality healthcare, education and social security. More money has been transferred to social aspects since the abolition of the army in 1948

Wealth cap

Proposed economic policy which sets a maximum limit on the total personal wealth an individual can accumulate

Why is balancing social needs and ecological boundaries important? 

allows for us to first achieve basic human rights and help us live towards the means of the planet: to secure human rights and to live in a safe environment

What are some limitations of GDP?

• can help with the economic growth of a country - the finances a country has

• but does not help with other social or environmental issues that impact the daily lives of citizens in countries, such as deprivation, degradation (environment) and inequality

Inclusion in development

Ensures that the benefits of economic development are shared equitably across all levels of society, particularly marginalised and vulnerable populations

Why is gender inequality a development issue?

• Restricts human potential

• Limits economic growth

• Hinders poverty reduction

The Girl Effect

• Launched by the Nike Foundation to empower girls to change lives and communities and transform societal views on the value of having girls

• Break the cycle of poverty & underdevelopment

• Builds youth-focused media such as TV shows, mobile apps and radio dramas

• Focuses on delaying child marriage, reducing unwanted pregnancies, improving access to education and increasing health service uptakes (eg. HPV vaccination)

Economic benefits of The Girl Effect on education

• Women with a secondary education earn higher lifetime earnings than those with no education

• One year of secondary education: 25% increase in wages later in life (Global Partnership for Education)

• Reduced fertility rates and maternal morality as educated women marry later

• Break the cycle of poverty

• Multiplier effect = cycle & passed down through generations, carries on throughout generations and everyone else

Effect of the Girl Effect on wider economic development

• UN: estimated that closing the gender gap could boost the economy by USD 7 trillion

• Reduced poverty & breaks the cycle of poverty

• GlobalGiving: agricultural productivity; increase yields by up to 30% and reduce hunger for 100-150 million people

Barriers to gender inclusion

• Cultural norms of the woman being the one to take care of the family at home

• Cost remains as a barrier for women accessing heathcare + giving birth placing strain on female bodies & access to expensive menstrual products

• Poor infrastructure for pedestrians = hard to commute, fear due to safety and harassment

Doughnut Economics

• Framework for sustainable development

• Shaped like a doughnut with two rings:

• Inner ring: ensures that no one falls into the hole by failing to meet social needs: food, health, education and housing

• Outer ring: ecological ceiling; prevents exceeding boundaries such as climate change, loss of biodiversity and pollution

• Beyond GDP growth - focuses on balancing social factors with environmental factors

• Focuses on reducing inequality by distributing resources more fairly

Bathtub model of the economy

• A bathtub - water represents profit; can be drained out or kept

• Bathtub as the economy - water level represents the level of economic activity or aggregate demand

• Water inflow - flowing in = symbolises spending and investment in the economy - such as taxes and imports - which pull money out of the economic system

• Water outflow - draining out = represents savings and leakages from the economy - taxes and imports

• Equilibrium - for the economic activity (water level) to remain stable = inflow must equal the outflow. Infor exceeds outflows = water level irises (economic growth). If outflows exceed inflows, the water level fails (economic contradiction).

Keynesian economics

• The idea that the government should intervene in the economy: that the government should spend money to keep the economy going, even if there is a recession.

• Keynesian economists believe that intervention will lead to full employment and price stability

• If aggregate demand falls, the weakness in production and jobs would result in a decline in prices and wages.

• Lower wages and inflation would thus allow employers to make capital investments and hire more workers, resulting in more jobs and restoring economic growth. 

Aggregate demand

The total demand for goods

Causes of 2025 LA wildfires

• 22-23 Cold & wet weather: excessive growth of trees

• 2024 - exceptionally dry weather; excessive growth of trees dried up to become timber; fodder to the blazes

• Santa Ana winds (like typhoon level winds)

• Only received 0.16 inches of rain since Oct 2024

• Caused by cool, dry air being blown

Classical conditioning (OUT OF CONTROL)

The association of an involuntary response and a stimulus

A learning process; the association of an involuntary response (neutral stimulus) with a naturally occurring stimulus to form a new stimulus-response connection.

Through a conditioned stimulus, a conditioned response, a neutral stimulus, an unconditional stimulus and an unconditional response

Pavlov’s classical conditioning (1890)

• When dogs were served food, a bell was rung

• The dogs associated the bell with food

• At the sound of the bell, the dogs began to salivate

Theory behind Pavlov

• When a dog sees food → signals from eyes and nose stimulate the brain, activating the salivary glands 

• When a dog hears a sound → sends a signal to the ears. Takes note but has no reason to activate 

• When activated simultaneously, new synaptic connections occur between the auditory stimulus and the behavioral response

• Over time, synaptic connections are strengthened; only takes the sound to activate the pathway leading to salivation

Neutral stimulus → conditioned stimulus in Pavlov

• Food

• Triggered an unconditioned response (salivation)

Conditioned stimulus

Neutral trigger; when paired with a unconditional stimulus it gains the ability to cause a learned reaction

Conditioned response

A learned, automatic response to a previously neutral stimulus

Neutral stimulus

Produces no specific response or reaction

Unconditional stimulus

Naturally triggers a response without any prior learning, training or conditioning

Unconditional response

Natural, automatic and unlearned reaction to something that does not require prior conditioning; out of control

Operant conditioning (CAN CONTROL)

The association of a voluntary behaviour with a consequence.

A learning process in which voluntary behaviours are strengthened or weakened by their consequences, using rewards to increase behavior or punishment to decrease it

Through positive reinforcement, negative reinforcement, positive punishment and negative punishment

Positive reinforcement

Adding something desirable to increase a behaviour (eg. praise for good work)

Negative reinforcement

Adding something desirable to increase a behaviour (eg. praise for good work)

Positive punishmemt

Adding something undesirable to decrease a behaviour (eg. getting fined for jaywalking)

Negative reinforcement

Removing something undesirable to increase a behaviour (eg. losing privileges)

Psychological distance

When Ttrms such as climate change and global warming draws attention to the global scale rather than personal impacts

Asch et al., 1951

• 123 white male college students 

• Introduced to a group of 6-8 students (actors)

• Shown 2 cards; one with 1 line and one with 3 lines

• All asked to say out loud what line was longer

• Real participant seated to respond last

• 1st round: Confederates = gave the first answer

• 3rd round+: began to respond with a wrong answer

• Either ignore the truth/the pressure

• 23% of students always gave the right answer

• 72% conformed to the majority at least once

• 5% always gave the wrong answer

• If one other student answered correctly = reduced peer pressure

Stanford Prison Experiment

• Zimbardo et al., 1971

• Determine if it was the acquisition of power that made guards turn brutal/is brutality intrinsic to human nature itself

• Determine: if the relationships were shaped more by the prison environment/personalities of the guards

• Created a mock prison environment - Stanford’s Jordan Hall

• Participants: 24 college students

Methodology of the Stanford Prison Experiment

• Prisoners: All arrested by cops

• 12 of each category; 9 active participants & 9 alternates

• 9 prisoners were arrested by real police officers

• Each person: mug shots, fingerprinted, blindfolded and moved into a holding cell

• Built in a space normally used as a lab

• Each cell: door, cell number, room for 3 prisoners

• Prisoners had to be blindfolded before taken into the bathroom

• Avoid selection bias: prisoners/guards based on a coil toss

• Guards = given complete prison uniforms w/ nightsticks and whistles

• Prisoners: stripped, deloused, sandals and smock, no underwear, nylon stocking caps, in lieu of having their heads shaved

Guard treatment during the Stanford Prison Experiment

• Guards - decided to use a whistle to rouse the prisoners from sleep (first night) for a head count at 2:30am

• Some prisoners didn’t take it seriously = punished by doing push ups

• Prisoners decided to rebel; 2nd morning: removed numbers from uniforms, pulled off stocking caps & barricaded themselves inside their cells

• Next shift of guards: prisoners yelling curses at them from their cells

• Brought in on call guards; night shift volunteered to do extra duty

• Cell doors open: fire extinguishers to force the prisoners out of the cells

• Open: grabbed the prisoners, stripped them naked

• Prisoner = solitary confinement

• Guards = removed the bed from the cell

• Rebellion was controlled = figure out how to prevent future rebellions

• Divide and conquer: deemed one of the cells the privilege cell

• Well-behaved prisoners in the privilege cell; uniforms and beds back, good food, special means

• Other prisoners: deprived of all of these things, normal food rations

• Guards would randomly move the prisoners around after a few hours; create confusion and distrust amongst prisoners

• Guards = dehumanized prisoners by making them call out their ID numbers

• Prisoners were forbidden to use the bathroom at night; bucket in cell; guards stopped emptying them

• Prisoners became more submissive and the guards more sadistic

Emotional impact on prisoners (Stanford Prison Experiment)

• 36 hrs: Doug Korpi; acute emotional disturbance, disorganised thinking, rage, uncontrollable crying

• Tried to coax him into becoming a snitch = guards

• Staff realized he was distressed = needed to be released

• Mock parole in the 6th day; inmates would be allowed to present their case to the board

• Theorized = prisoners no longer saw them as participants in an experiment, but as real prisoners

• Prisoner 819 - broke down sobbing; other inmates turned on him

• Felt that he couldn’t leave even when told that he could be taken to a doctor; because the other inmates had labeled him a bad prisoner; forced to intervene

Findings of the Stanford Prison Experiment

• Guards = three types

  • Tough & fair guards = followed prison rules

  • Good guards = did little favours and never punished

  • Hostile guards, and inventive in forms of degradation, enjoyed the power

• Most people were willing to fulfill whatever role they were given in a social setting 

• Even Zimbardo internalised his role as superintendent over psychologist

• Brought in a priest to talk to prisoners

End of the Stanford Prison Experiment

Only lasted 6 days by 2 weeks; psychologist Christina Maslack - saw the study and confronted Zimbardo

(Un)Ethics of the Stanford Prison Experiment

• Failure to protect participants from psychological abuse, humiliation and stress

• Lack of informed consent/understanding of what the experiment would contain

• Discouraging of participants to withdraw

• Researcher bias & over-involvement.

How did California residents react to the wildfires?

• Fear and distress - crying, grief

• Religious actions - praying to God

• Attempts to contract loved ones - FaceTime w/ relatives, asking other neighbours to look for their loved ones, looking themselves

How did California residents respond to the wildfires?

• Fleeing the area - driving away in cars

• Conformity as a fight/flight instinct to get away and remain safe

• Informational conformity as following government guidelines and warning system

• Praying

• Community; praying for safety = self-identity

• Following government instructions to flee and evacuate

• Seeking safety; listening to the gov to keep safe = normative conformity

• Staying behind (stay & defend mentality)

• Attempts to rescue belongings

• Conformity from seeing others do the same - informational conformity

Normative conformity

Definition

• Influence which prompts individuals to conform to group norms in order to fit in & gain acceptance

• Compliance - the person changes their public behaviour, but not their private beliefs

• The change in behaviour is temporary

Examples

• Peer pressure: conforming to gain acceptance and avoid social exclusion (leads to compliance)

• Fashion trends: desire to fit in with societal expectations

• Likes on social media: alignment with popular sentiment

Studies

• Asch et al., 1951

Informational conformity

Definition

• Leads people to conform due to a belief that people possess competent & correct information, especially in ambiguous situations and tasks

• Occurs when a person is unsure of a situation or lacks knowledge

• When people publicly change their behaviour to fit in with the group while agreeing with them privately

• Group beliefs become part of an individual’s belief system

• Internalisation: when attitudes/behaviour are made part of one’s nature by learning/unconscious assimilation

• Unconscious assimilation: the natural ability we have to mirror others

Examples

• A person goes to an upper-class restaurant for the first time

• Has several forks and doesn’t know which fork to use

• Looks to a nearby person to see what fork to use first

Case studies

• Sherif et al., 1935 - Participants were shown a stationary pinpoint of light in a dark room; asked to estimate how far the light moved

• When estimates were made in a group,
  estimates were similar = participants’ estimates converged to a similar value

• Jeness et al., 1932 - Participants were asked to estimate the number of beans in a jar

• Individual estimate; then group estimate

• In a social group: participant estimates converged to a similar value despite their initial individual estimates varying significantly

• Group can impact individual values and beliefs

Jonestown

• 900+ died, mass suicide and murder

• Leader of the People’s Temple

• Jones: Dedication to racial equality & human rights

• 1965: concerns about a nuclear war, convinced followers (20,000+) to move to California

• Guyana - moved to live in the Jonestown settlement

• Prompted by congressman Leo Ryan - followers asked him to help leave when he visited, Ryan = shot down

• Jones convinced followers to kill suicide

• Convinced followers: degradation, humiliation, prove loyalty

  • They were forced to: strip naked, forced to have sex, weaken willpower

• Called the killed “angels”

• Convinced that when they died, they would be transferred to a peaceful planet

Milgram’s study of obedience (Milgram et al., 1963)

• Trial of Adolf Eichmann (WWII criminal). Eichmann's claim that he was simply following orders in the genocide of millions of Jews: sparked Milgram's interest

• 40 men recruited using newspaper ads

• A shock generator that began at 15 volts and increased in 15-volt increments up to 450 volts.

• Switches had labels such as "slight shock," "moderate shock," and "danger: severe shock."

• The last three switches were marked with "XXX."

Method of Milgram et al., 1963

• Each participant took the role of a "teacher" who would then deliver a shock to the "learner" in a neighboring room whenever an incorrect answer was given.

• While participants believed that they were delivering real shocks to the student, the “learner” was a confederate in the experiment pretending to be shocked

• The participant would hear the learner plead to be released or even complain about a heart condition.

• Once they reached the 300-volt level, the learner would bang on the wall and demand to be released

• Beyond the point - learner would become completely silent & refuse to answer any more questions.

• Most participants would ask the experimenter if they should continue; experimenter would respond with a series of prods

• "Please continue."

• "The experiment requires that you continue."

• "It is absolutely essential that you continue."

• "You have no other choice; you must go on."

Results of Milgram et al., 1963

Milgram found that 65% of participants delivered the highest level of shocks. Out of 40 participants, 26 administered the maximum shocks, while 14 stopped before reaching the highest level.

Ethical concerns of Milgram et al., 1963

• The use of deception

• The lack of protection for the participants who were involved

• Pressure from the experimenter to continue even after asking to stop, interfering with participants' right to withdraw

Obedience

• acting on the orders of an authority figure.

• involves actions a person would not have taken, unless they were directed to do so by someone of authority or influence

Difference between obedience & conformity

• Conformity adjusts actions or thoughts to align with a group

• Obedience follows orders from authority

Five Steps to Tyranny

1. “us” and “them” (prejudice and the formation of a dominant group)

2. obey orders (the tendency to follow orders, especially from those with authority)

3. do “them” harm (obeying an authority who commands actions against our conscience)

4. “stand up” or “stand by” (standing by as harm occurs)

5. exterminate (the elimination of the “other”)

Social psychology

how social influence, social perception and social interaction influence individual and group behavior

Behaviorism

the study of observable behaviour

Conditioning

a behavioural learning process where a specific stimulus/consequence triggers a learned response (continuous)

risk perception

process where people evaluate dangers/the characteristics or severity of a risk

Climate denialism

• rejection or doubt about the extent that climate change is caused by humans/scientific consensus on climate change

• tactics include cherry-picking and conspiracy theories

Why do people deny climate change?

• Political identity

• Motivated reasoning: information that fits their existing worldview is accepted

• Misinformation

• Distrust of experts

Ethics in psychological studies

• Informed consent (participants should be informed of the study’s purpose, procedure, risks ect)

• Protection from harm (must minimise physical & psychological discomfort)

• Voluntary participation & withdrawal

• Debriefing

• Deception - should not be used to conceal risks/psychological effects, sometimes justified to minimise harm and maximise benefits

Baltic Way / Baltic Chain

A peaceful protest on August 23, $1989$, consisting of a human chain of $2,000,000$ people stretching $600\,km$ across Estonia, Latvia, and Lithuania to condemn Soviet occupation.

Molotov-Ribbentrop Pact (Hitler-Stalin Pact)

A secret $1939$ agreement between the Soviet Union and Nazi Germany that divided Europe into spheres of influence and led to the illegal occupation of the Baltic States.

Sajudis of Lithuania

One of the three independence movements that organized the Baltic Way, alongside the Popular Front of Latvia and the Popular Front of Estonia.

Atlantic Slave Trade

Transported between 10 million and 12 million enslaved Africans across the Atlantic Ocean to the Americas from the 16th to the 19th century.

Demand for slaves

First African slaves: 1619, Jamestown

17th and 18th centuries: tobacco; 19th: cotton plantations due to the demand for cotton

• Tobacco, coffee, cotton, sugar, mining, rice

1650-1860: 10-15 million enslaved people were translated from Africa to the Americas

Lincoln: anti-slavery

The North was a slave based economy, which changed in 1860 when Lincoln, who was more against slavery, was elected president

Confederate States of America

11 southern states broke away from the North, due to worries that the government would abolish slavery, forming the Confederate States of America

The Confederates were seen as traitors. Britain and France were ready to recognise the Southern Confederate States as a separate nation

Emancipation Proclamation

A document issued by President Lincoln in January $1863$ declaring that all slaves in states rebelling against the Union 'shall be then, thenceforward and forever free.'

War tactic to get former slaves to fight for them in the union

American Civil War (1861-65)

200,000 African Americans answered the call to fight against the South. Resulted in the government passing the 13th Amendment and abolishing slavery