Development of the Modern Economic History

NAME : TINOTENDA

SURNAME : BARWE

STUDENT NUMBER : 201517409

TUTOR : KvL/ZN

MODULE : AST1B01

ACCOUNTING STUDIES ASSIGNMENT ONE

UNIVERSITY OF JOHANNESBURG

05 JULY 2015

Major economic historical events which resulted in the modern economic systems took place in the 20th century (www.pbs.org/wgbh/commandingheights/shared/minitext/tr_show01.html#1). During the 20th century, that’s when two important economists ( Friedrich Hayek and John Maynard Keynes) in the history of development of the economic system emerged, these economist had rival views. Their two schools of thought dominated the Western economy. Hayek believed in free markets while Keynes believed government regulation of the markets, and each school of thought had its own period of dominance as summarized in the following paragraphs.

Soon after the Bolshevik Revolution which took place in 1917 in Russia, Russia became the first world known communist country knowns as USSR and the following decades it experienced a higher economic growth and development. The Soviet government maintained tight control over its borders, of the movement of people within the country, and of the media. Because of this, international visitors were only let into the USSR in small numbers and were only allowed to visit the small parts of the country that were well-developed. All visitors to the Soviet Union therefore left with biased impressions of how advanced the country was which led to other countries and citizens to believe that communism was a better market economy (www.youtube.com/watch?v=N9pn3iQU02w)

After the World War 1 (WW1) came to an halt in 1918, Germany was made to pay war reparations according the Treaty of Versailles, Keynes who was an economic adviser in the British government was against the terms of...