Akjgsdkhg

Econ 4900

1.24.13

Next week: heilbroner WP ch2 and backhouse ch3

In islam you are required to help the poor and not take interest.

In islam lending money is like partnership.

They are against monopolies and speculation.

Aritotle (310 B.C) Greece

There was little trade but most production was by the people themselves (farmers).

The production was traditional, passed on through generations.

Keeping the society stable.

The other part was slavery, who were commanded to work for project.

All religions were claiming that there was something more important than welath and making money.

The greece society was declining in his time, at the same time trade was increasing.

Is there a relation between increased trade and the decline of ancient greece?

He saw that in life there were different positions:

1. Merchants – were traders who traveled from place to place

2. Money lenders

He thought they are responsible for the decline, but he saw that this has also a good side.

Trade has both positive and negative effects.

Aristotle wanted to know what are those effects.

Use value VS exchange value. Use value is the use value of a product, they satisfy a human need, Chair – to sit on.

Exchange value is the value that good has in exchange,Chair – to trade it.

He distinguished between two kinds of trade:

A. Economic – house hold management. Natural trade is to satisfy the family needs. Use value for use value.

It helped the society. But it was limited to the things the society needed.

B. Non Economic (Unatural trade) – trade for the accumulation of wealth, in order to make money, feeding desires and not satisfying needs. Done for exchange value. Socialy distabilizing.

He distiguishing between needs and desires/wants.

What is the purpose of money?

To facilitate the economic trade. Neccessary to natural exchange.

If it was used to make more money (unatural) it was harmful to society.

As a result interest on money should be forbidden. It underminds its natural purpose.

The politics...