Economic Goals of Governments

Ms. RamosAlta Loma High School

How do societies decide?

A society’s answers depends on its economic goals

Ms.Ramos

Freedom Efficiency

Equity Growth Security Stability

Economic Goals(Not all may be addressed by a govt)

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Freedom

Ability of people to make their own economic decisions

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Efficiency

Make most of resources, least amt of waste Includes workers

Full employment

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Equity

Fairness & just distribution of society’s wealth What is fair?- often

debated

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Growth

Produce more G&S Leads to improved

standard of living KEY---- science &

technology

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Security

Provide for less fortunate Food, shelter,

healthcare Also debated

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Stability

G&S we count on are available Elec, food, clothing,

jobs, prices

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Who decides what in different economic systems?

Insert markets handout here in your notes

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3 Economic Systems

Traditional Economies Decisions by custom

Command Economies Decisions by pwrful rulers

Market Economies Decisions by individuals

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Capitalism gives rise to Socialism- Closer Look: Soviet Union 1st modern command economy Communist–-- authoritarian

(social goal by force) Economic planning by govt

Shortages common…lines Lack of choice Ignore incentives…work/products

inferiorMs.Ramos

How do mixed economies divide the decision making?

No Pure Economies!!! All are mixed to varying degrees

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All govts: Legal Law enforcement Currency Regulations (food, work) –

vary Public Goods (dams, roads,

hospitals)Ms.Ramos

Circular Flow Model

http://dreamofbiz.blogspot.com/2007/09/economic-problem-scarcity-wants-and.html Ms.Ramos

Circular Flow in a Mixed Economy

•kisdwebs.katyisd.org/campuses/THS/teacherweb/.../CircFlowModel.ppsx Ms.Ramos

http://02b8223.netsolhost.com/blog/wp-content/uploads/2008/10/index2007_econfreedommap.jpg Ms.Ramos