When analysing markets, a range of assumptions are made about the rationality of economic agents involved in the transactions
The Wealth of Nations was written
1776
Rational
(in classical economic theory) economic agents are able to consider the outcome of their choices and recognise the net benefits of each one
Rational agents will select the choice which presents the highest benefits
Consumers act rationally by
Maximising their utility
Producers act rationally by
Selling goods/services in a way that maximises their profits
Workers act rationally by
Balancing welfare at work with consideration of both pay and benefits
Governments act rationally by
Placing the interests of the people they serve first in order to maximise their welfare
Groups assumed to act rationally
Consumers
Producers
Workers
Governments
Rationality in classical economic theory is a flawed assumption as people usually don't act rationally
Marginal utility
The additional utility (satisfaction) gained from the consumption of an additional product
If you add up marginal utility for each unit you get total utility
AP World History - Ultimate Guide
Unit 1: The Global Tapestry
Review of History Within Civilizations
What rises out of collapse of classical civilization and interactions developing between new states
Growth of long-distance trade
Overview of World's Major Religions in 1200
Most events are connected to religion
Key Points
Most belief systems still are impacting history
Most major religions have divisions = subgroups and sects (focus more on overall religion)
Understand theological basis of belief systems and impact of belief systems on social, political, cultural, military developments
Origin and spread of belief systems - cultural interactions
Religious Mysticism: adherents within religions focusing on mystical experiences that bring them closer to divine - prayer, meditation
Cultures
India, China, Southeast Asia, Japan
Context
Founded by Siddhartha Gautama, a young Hindu prince - lived in Nepal from 563-483 BCE, rejected wealth and world possessions and became Buddha (Enlightened One)
No supreme being - 4 Noble Truth: (1) all life is suffering, (2) suffering caused by desire, (3) can be freed of desire, (4) freed of desire following a prescribed path
Death of Buddha (483 BCE) = Buddhism split - Theravada Buddhism and Mahayana Buddhism
Theravada Buddhism: meditation, simplicity, nirvana as renunciation of consciousness and self
Mahayana Buddhism: great ritual, spiritual comfort - more complex but with greater spread
Impact
Rejects caste system - appealed to those of lower rank
India: reabsorbed in Hinduism
China, Japan, Southeast Asia: Buddhism continued to thrive
Further: spread via trade routes
Cultures
Started as group of Jews, quickly expanded through Europe, northeastern Africa, Middle East
Context
Based around Jesus of Nazareth, a figure who claimed to be Messiah the Jews had awaited - teachings of devotion to God and love for others
Jesus was crucified by Roman and Jewish leaders in 30 CE and his followers believe he rose from dead into heaven
Based on Bible teachings
Believe Jesus is the Son of God - forgiveness of sins, everlasting life is achievable through him
World was created by God, but world has fallen from God
Believers should seek God and care for him and others
Impact
Compassion, grace through faith appealed to lower classes and women
Became most influential religion in Mediterranean basin by 3rd century
Became official religion of Roman Empire, then branching north and west
Connection with Roman Empire had profound impact on global culture
Cultures
China (400 BCE+)
Context
Founded by Confucius, educator and political advisor - thoughts and sayings collected in the Analects
Deals with how to restore political and social order, not with philosophical or religious topics
5 fundamental relations build society and make it orderly - (1) ruler and subject, (2) parent and child, (3) husband and wife, (4) older sibling and younger sibling. (5) friend and friend
Impact
Compatible with other religions, causing it to flourish
Led to distinctive Chinese culture of tight-knit communities
Stayed within Chinese culture
Context
Belief in one supreme force called Brahma who created everything - gods are manifestations of Brahma (Vishnu = preserver, Shiva = destroyer)
Goal of believer is to merge with Brahma - believe it takes multiple lives to accomplish and believers live to determine who they will be in their next life
Following the dharma (rules and obligations of your caste) will move you towards Brahma - moksha is highest stake of being (internal peace and release of soul)
No sacred text - Vedas and Upanishads guide Hindus
Impact
Religion and social caste system, which has prevented global acceptance of religion
Recently, Hindus are rebelling caste system
Spawned Buddhism
Cultures
Caliphates (Islamic kingdoms), North Africa, central Asia, Europe
Context
7th century - Muslims are the believers
Allah presented words through prophet Muhammad, whose words were recorded in the Qur'an
Salvation is won through submission to God - 5 Pillars of Islam: (1) confession, (2) prayer 5 times a day, (3) charity, (4) fasting during Ramadan, (5) pilgrimage to Mecca
2 groups, Shia and Sunni, who disagreed who should succeed Muhammad
Impact
Rapidly spread to Middle East
Context
God selected a group of holy people who should follow his laws and worship them
Unique relationship with God
World is for them to enjoy, free will - destiny of world is paradise