Economic Systems of the World - Edl · of different Economic Systems of the World? Global History...
Transcript of Economic Systems of the World - Edl · of different Economic Systems of the World? Global History...
What are the characteristics of different Economic Systems of the World?
Global History and Geography10th Grade Boys & Girls
Friday, September 22, 2017
Economy• It is the system of administration that
determines the modes of Production and usage of goods and services in a country
• Key ideas– Modes of production and usage
– Goods & Services
Types of Economy• Traditional Economy: (Subsistence)
– One that did not change over a long period of time.
– One that supports a family– Examples:
• Traditional farming based economy / SubsistenceFarming
• Trade is barter based
Types…….cont….• Command Economy
– Means of productions and usage of goods and services are controlled by a higher authority which, usually, is a government
– Example: Socialism practiced in communist countries
• Market Economy/Capitalism/Laissez-Faire– Uncontrolled economy– Market Factors: Supply & Demand
Types….Cont…..• Mixed Economy
– Uses any combination of traditional, command and market economy elements.
– Most developing countries have this systems
Characteristics of Market Economy
• Ownership: All Property, including means of production is privately owned.
• Economic Decision: Private Businesses and individuals are free from public control so that they can make basic economic decisions, including what, where, how much, and what prices goods will be produced
• Market Controls: Prices are determined by Supply and Demand. Competition promotes high quality and low prices
Characteristics of Command Economy
• Ownership: The government owns the means of production, distribution and exchange
• Economic decisions: Government officials make all basic decisions, such a s what will be produced, when and where.
• Market Control: The government controls the economy. There is limited productions of consumer goods and an emphasis on industrial growth.
Homework• Write an essay comparing and contrasting
capitalism [market economy] and Communism/socialism [command economy]