How Economics Can Strengthen
the Teaching of U.S. History
Overview

Problems teaching
history
 How economic
thinking might help
 Features of Focus:
Understanding
Economics in U.S.
History
Problems Teaching U.S. History

Schools rely on U.S. history to teach
Our national identify
 An academic understanding of our past.


But, history teaching is criticized as
being
Boring in content and pedagogy
 Superficial
 Trivial
 Remote

Problems Teaching U.S. History
 Students
usually take 6 semesters
of U.S. history:
 Grade 5: 2 semesters
 Grade 8: 2 semesters
 Grade 11: 2 semesters
 Yet, national tests show that
achievement in history is low.
U.S. History Achievement Levels:
1994, 2001, NAEP
Level
GRADE 4
1994
2001
GRADE 8
1994
2001
GRADE 12
1994
2001
Advanced
2%
2%
1%
2%
1%
1%
Proficient
15%
16%
13%
15%
10%
10%
Basic
47%
49%
48%
48%
32%
32%
Below
Basic
36% 33%* 39% 36%* 57%
57%
What Can Economics Contribute?
Economics
stresses the idea
that all people
make choices.
 But, they don’t
know at the time
what the
consequences of
their choices will
be.

Individual Choices

All social
phenomena emerge
from the choices
that individuals
make in response to
expected costs and
benefits to
themselves.

Paul Heyne
John Maynard Keynes

The inevitable never
happens. It is
always the
unexpected.
Who Would Have Predicted in
1980?

The collapse of the
Soviet Union.
 The reunification of
Germany.
 Nelson Mandela
becoming president of
South Africa.
 Economic stagnation in
Japan in the 1990s.
Who Would Have Predicted in
1980?

Record U.S. economic
expansion in the 1990s.
 An attack on the World
Trade Center on 9/11.
 All-out war in Afghanistan
and Iraq.
They Didn’t Know How It Would All
Turn Out

In writing history or biography, you must
remember that nothing was on track.
Things could have gone any way at any
point. As soon as you say “was” it
seems to fix an event in the past. But
nobody ever lived in the past, only the
present.
They Didn’t Know How It Would
Turn Out
The difference is that it was their
present. They were just as alive and full
of ambition, fear, hope and all the
emotions of life. And, just like us, they
didn’t know how it would all turn out.
 The challenge is to get the reader
[student] beyond the thinking that things
had to be the way they turned out and to
see the range of possibilities of how it
could have been otherwise.


David McCullough
The Economic Way of Thinking

Focus: Understanding Economics in
U.S. History introduces students to the
economic way of thinking.
It stresses how people at the time were
making choices in response to anticipated
benefits and costs.
 This approach allows students to be
“present-minded” about the past.

History Matters: Douglass North

History matters not
only because we can
learn from the past
but because the
present and the past
are connected by the
continuity of a
society’s institutions.
Fostering Cooperation
Human cooperation allows for gains from
trade.
 Economic growth depends upon the
institutions that create a hospitable
environment for cooperative solutions to
problems associated with trade.

What institutions induce economic
stagnation and decline?
 What institutions induce prosperity and
growth?

What Explains Different Outcomes?
Sustained economic growth in the United
States and western Europe?
 The spectacular rise and fall of the
Soviet Union?
 The growth of Taiwan and South Korea?
 The dismal record of sub-Saharan
Africa?
 The contrasts between North America
and Latin America?

Institutions Matter

Choices made by our ancestors have
fundamentally shaped the institutions
with which we live today.
Young people can learn to see events as
outcomes produced by the choices people
make every day.
 They can also understand how people’s
choices are shaped by institutions.

Teaching Matters, Too

“With its explicit
emphasis on
choices, costs,
incentives, rules of
the game and
voluntary trade, the
curriculum presented
here will provide
educators with a
valuable source of
focus and direction.”
Citation

Authors
 Jean Caldwell
 Tawni Hunt Ferrarini
 Mark Schug
 Published by the
NCEE
 Generous support from
the Calvin K. Kazanjian
Economics Foundation
Features

Linked to NCEE
Standards
 Essay by Professor
Douglass North
 Introductory essay on
the economic way of
thinking:

Why Did the Colonists
Fight When They Were
Safe, Prosperous and
Free?
The Guide to Economic Reasoning






People choose.
People’s choices involve costs.
People respond to incentives in
predictable ways.
People create economic systems that
influence individual choices and
incentives.
People gain when they trade voluntarily.
People’s choices have consequences
that lie in the future.
Table of Contents
Table of Contents
Unit 1 Three World Meet
1. The New World Was an Old World
2. Property Rights Among North American
Indians
Table of Contents
Unit Two: Colonization and Settlement
3. Why Do Economies Grow?
4. Understanding the Colonial Economy in
a Global Context
5. Indentured Servitude: Why Sell Yourself
into Bondage?
6. Specialization and Trade in the Thirteen
Colonies
Table of Contents
Unit 3: Revolution and the New Nation
7. The Costs and Benefits of American
Independence
8. Problems under the Articles of
Confederation
9. The U.S. Constitution: Rules of the
Game
Table of Contents
Unit Four: Expansion and Reform
10. Rising Living Standards in the New
Nation
11. How Did Cotton Become King?
12. Francis Cabot Lowell and the New
England Textile Industry
Table of Contents
13. Improving Transportation
14. Investing in American Growth
15. Why Did the Indians of the Great
Plains Invite White Americans into Their
Land?
16. Andrew Jackson and the Second Bank
of the United States
17. Free the Enslaved and Avoid the War
Table of Contents
Unit Five: Civil War and Reconstruction
18. Why Did the South Secede?
19. Economic Analysis of the Civil War
Table of Contents
Unit Six: The Development of the
Industrial United States
20. Was Free Land a Good Deal?
21. The Changing U.S. Economy
22. The Demand for Immigrants
23. Bigger Is Better: The Economics of
Mass Production
Table of Contents
24. Industrial Entrepreneurs or Robber
Barons?
25. The Economic Effects of the 19th
Century Monopoly
26. Could the U.S. Economy Have Grown
Without the Railroads?
27. Free Silver or a Cross of Gold
Table of Contents
Unit Seven: The Emergence of Modern
America
28. Money Panics and the Establishment
of the Federal Reserve System
29. Who Should Make the Food Safe?
Table of Contents
Unit Eight: The Great Depression and
World War II
30. Whatdunit? The Great Depression
Mystery
31. Did the New Deal Help or Harm
Recovery?
Table of Contents
32. We Shall Not Be Moved
33. When the Boys Came Marching Home
34. Women in the US Workforce
Table of Contents
Unit Nine: Postwar United States
35. The Economics of Racial
Discrimination
36. The No-Good Seventies
Table of Contents
Unit Ten: Contemporary United States
37. The Hispanic Americans
38. The Knowledge- and TechnologyBased Economy of Today
39. World Trade after World War II: The
EU, NAFTA and the WTO