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1 Growing Labor Productivity Bushels of Wheat Per Hour of Labor Increased commercial fertilizer,3- bottom gang plow, tractor, 10-foot tandem disk, harrow Increased commercial fertilizer, Gang plow, Seeder, Harrow, Binder, Thresher, Wagons, and Horses Walking Plow, brush harrow, hand broadcast of seed, sickle, and flail Anhydrous Ammonia Introduced, Tractor, 12-foot plow, 14-foot drill, 14-foot self-propelled combine, and trucks Increased Commercial Fertilizer,Tractor, 10-foot plow, 12-foot role weeder, harrow, Self-propelled combine, and trucks With Tractor, 35-foot sweep disk, 30-foot drill, 25-foot self-propelled combine, and truck With Tractor, 30-foot sweep disk, 27-foot drill, 22-foot self-propelled combine and truck from Samuel Bowles, Richard Edwards and Frank Roosevelt, Understanding Capitalism: Competition, Command and Change (Oxford University Press, 2004) Notes on the following page

2 Growing Labor Productivity Labor saving technologies have revolutionized the process by, and speed at which, we generate the numerous products we now consume. Consider the cultivation of wheat in the U.S., shown in the figure. In 1800, using rudimentary equipment that had been in use for centuries, a single individual could cultivate and harvest a third of a bushel for every hour worked. By 1985, the same person could produce a hundred times that amount by using advances in agricultural mechanization, chemical fertilizers and production processes. Source: United States Department of Agriculture. A History of American Agriculture Available at

3 Capitalism and Wages Real Wage Index from Samuel Bowles, Richard Edwards and Frank Roosevelt, Understanding Capitalism: Competition, Command and Change (Oxford University Press, 2004) Notes on the following page

4 Capitalism and Wages The real wage measures the buying power of a typical daily wage. (The term real means corrected for inflation). The graph shown provides evidence of the real wages of skilled construction workers over 8 centuries. The figures reported here are termed an index, measuring the real wage in each year relative to the real wage in some other year. For example, the index averages 100 for 1850 and is 58 in 1300, meaning that the real wage in 1300 was 58% of what it was in While the data are subject to considerable error, they tell an interesting story. After 1800 and particularly after 1900, the real wage rose dramatically. There were minor fluctuations in the real wage before that point, often arising from changes in the population. For example, the rise in the real wage between 1300 and 1400 happened because of a labor shortage caused by the bubonic plague. Sources :. Allen,Robert : Wages, Prices and Living Standards: The World Historical Perspective, mimeo. Available at

5 Urbanization from Samuel Bowles, Richard Edwards and Frank Roosevelt, Understanding Capitalism: Competition, Command and Change (Oxford University Press, 2004) Notes on the following page

6 Urbanization Eric Hobsbawm, a noted economic historian once wrote that industrialization and population movments have gone together. In his words, the economic development of the world required ".. the rural exodus towards the cities, ( and) the migration between regions and from town to town". Urbanization, the growing concentration of people in cities, has indeed been an important feature of the capitalist era. In 1850, there were three cities (London, Paris and Peking) with a population greater than a million. By 2002, as the world map above shows, the number is an astonishing 405 (not all of which are shown). Sources: Hobsbawm, E., The Age of Capital (Abacus, London, 1995), p228. Chandler, Tertius 1987, Four Thousand Years of Urban Growth: A Historical Census, St. David's University Press. The map was generated by D Sateesh, using GIS 7.

7 Capitalism and the Population Explosion Average Annual Growth Rate 3.0% 2.5% 2.0% 1.5% 1.0% 0.5% 0.0% The Demographic Transition Spread of Modern Medicine Industrial Revolution Projected 2050: 9 Billion Millions Advent of Capitalism First Development Of Agriculture 0 BC BC BC BC BC BC BC BC-6500 BC BC BC BC BC BC BC BC BC- 550 BC from Samuel Bowles, Richard Edwards and Frank Roosevelt, Understanding Capitalism: Competition, Command and Change (Oxford University Press, 2004) Notes on the following page

8 Capitalism and the Population Explosion For most of the last 12,000 years, the total population of the world grew slowly, if at all, with periods of increase in good years followed by declines in response to climatic adversity and other calamities. There are about 20 cities in the world today whose population exceeds the entire population of the world at the time that agriculture began displacing hunting and gathering eleven thousand years ago, when there were at most 10 million humans. Population started growing rapidly in a few countries a couple of centuries ago, but the world's population really exploded in the 20th century with the development of modern medicine and its spread throughout the world. While the number of people in the world continues to grow, the pace of growth is slowing down (see inset). Demographers think that the population of the world will stabilize at around 11 billion around the year Sources: United Nations Development Project World Population From Year 0 to Stabilization, United Nations. U.S. Bureau of the Census Historical Estimates of World Population, Available at U.S. Bureau of the Census Total Midyear Population for the World: , Available at

9 Two Millennia of World GDP Per Capita $6,000 80% 70% The West $5, value 1990 international dollars $5,000 $4,000 $3,000 $2,000 Percentage of World GDP 60% Asia 50% 40% 30% 20% 10% Latin America, Africa and Eastern Europe 0% $1,000 $444 $435 $565 $667 $ otes on the following page Year A.D. rom Samuel Bowles, Richard Edwards and Frank Roosevelt, Understanding Capitalism: Competition, Command and hange (Oxford University Press, 2004)

10 Two Millennia of World GDP Per Capita While output per person in the world remained steady for almost two millennia, the advent of capitalism saw an explosion in this figure. By 1990, the output per person in the world had grown by a factor of nearly 10 since the early 16th century. Most of this growth happened in Europe and its Western offshoots ( The US, Canada, Australia and New Zealand). Source: Maddison, Angus The World Economy: A Millennial Perspective. Paris, France : Development Centre of the Organisation for Economic Co-operation and Development

11 Growing World Inequality ( ) Income Share of the Top 10% of the World's Population Percent of World's Income Income Share of The Bottom 60% of the Worlds's Population from Samuel Bowles, Richard Edwards and Frank Roosevelt, Understanding Capitalism: Competition, Command and Change (Oxford University Press, 2004) Notes on the following page

12 Growing World Inequality ( ) Since the emergence of capitalism in Europe and its gradual spread throughout the world, the fortunes of the rich and the rest have diverged. This has occurred because the countries in which capitalism first took root Europe and North America in particular experienced a rapid expansion of output while most of the rest of the world stagnated. Within many countries the level of inequality has fallen considerably, but the growing between country inequalities has resulted in a more unequal world. Since 1960, the trend has moderated somewhat in large part due to the relatively rapid economic growth of the two largest poor countries in the world India and China. Source: Bourguignon, François and Christian Morrisson Inequality Among World Citizens: , American Economic Review 92:4 pp

13 A Revolution in Global Climate: Fossil Fuels and Global Warming 1 Deviation from Mean Average Northern Hemisphere Temperature Parts Per Million Co2 in the air over the last millennium Annual Global Emissions of Co2 from Fossil Fuel Consumption ( Billions of Tons) from Samuel Bowles, Richard Edwards and Frank Roosevelt, Understanding Capitalism: Competition, Command and Change (Oxford University Press, 2004) Notes on the following page

14 A Revolution in Global Climate: Fossil Fuels and Global Warming Average temperatures fluctuate from decade to decade under the influence of many factors, including reduced sunlight due to various factors including variations in solar radiation and volcanic events such as the massive Tambora eruption in 1815, and the Krakatau explosion in The Tambora volcano in 1815 spewed forth so much ash that 1816 was known as the "year without a summer" (frost covered the southern United States on the fourth of July). The 1883 Krakatau eruption produced an ash cloud that circled the world for over two years, reducing the Earth s temperature. However, over the last century average temperatures have risen under the influence of the increasingly high levels of greenhouse gas concentrations resulting from CO2 emissions resulting from the burning of fossil fuels. The decade of the 1990s was the hottest in the past 1000 years. The data in the figure come from estimates of past temperatures based on the study of trees and their fossils, the properties of ice formed centuries ago, and other sources. Carbon dioxide emissions have changed significantly over the past three centuries, as is evident from the bottom panel and the insert. The insert shows that CO2 emissions from fossil fuel consumption have risen exponentially over the last two and a half centuries. Sources: Mann, Michael, Raymond Bradley, and Malcolm Hughes "Global-scale temperature patterns and climate forcing over the past six centuries." Nature, 391:April, pp Data available at Marland, G., T.A. Boden, and R.J. Andres Global, Regional, and National CO2 Emissions. In Trends: A Compendium of Data on Global Change. Carbon Dioxide Information Analysis Center, Oak Ridge National Laboratory, U.S. Department of Energy, Oak Ridge, Tenn., U.S.A. Available at World Resources Institute World Resources Institute Annual Report, World Resources Institute Joe Von Fischer of Princeton University and Santa Fe Institute assisted with this diagram.

15 Environmental Effects of Different Lifestyles and Policies: Cumulative CO2 Emissions Per Capita-1950 to Annual Emissions of C North America Tons of C02 Emissions Per Capita Thousands of Metric Tons of Carbon Western Europe Asia Africa/ Middle East Latin America Europe North America from Samuel Bowles, Richard Edwards and Frank Roosevelt, Understanding Capitalism: Competition, Command and Change (Oxford University Press, 2004) Notes on the following page

16 Environmental Effects of Different Lifestyles and Policies: Cumulative CO2 Emissions Per Capita-1950 to 1996 The rich countries account for most of the CO2 emissions that are the primary contributor to global warming. Over the last half century, North America produced about half of world wide cumulative emissions of CO2, almost all of it from the U.S., while Europe contributed about a third. The bars show that on a per capita basis ( from 1996) North America contributes more than ten times as much as the poorer regions of the world. Emissions from North America have continued to rise over this period, while in Europe emissions leveled around the mid 1970 s. The U.S is also the highest polluter per capita among the rich countries of the world. In 2001, each American was responsible for more than 20 tons of carbon dioxide emissions. In countries with a similar level of income such as Norway and Switzerland, the equivalent figures are about 7 and 5 tons per person. The US alone also contributed about two and a half times more CO2 over the period than China and India combined (countries with a combined population about 8 times that of the US). Sources: Marland, G., T.A. Boden, and R.J. Andres Global, Regional, and National CO2 Emissions. In Trends: A Compendium of Data on Global Change. Carbon Dioxide Information Analysis Center, Oak Ridge National Laboratory, U.S. Department of Energy, Oak Ridge, Tenn., U.S.A. Available at World Resources Institute, World Resources Institute Annual Report 2001, World Resources Institute