Use LEFT and RIGHT arrow keys to navigate between flashcards;
Use UP and DOWN arrow keys to flip the card;
H to show hint;
A reads text to speech;
26 Cards in this Set
- Front
- Back
|
BIG PICTURE: |
The government provides for the economic welfare of its citizens by making economic policy/decisions |
|
|
When we talk about "standard of living," what are we talking about? |
how well off, in general, are the people of a country |
|
|
What are some of the criteria we use to measure a country's standard of living? MUHI |
-median income -unemployment rate -homelessness rate -infant death rate |
|
|
When we talk about "limited resources," what types of things are we talking about? CHEN |
-Capital resources: money/wealth, machinery, equipment, buildings, etc. -Human resources (employees, labor) -Entrepreneurship (starting businesses) -Natural resources (land, water, coal, natural gas, timber) |
|
|
Bottom line: a country's resources ARE LIMITED- which means there are never enough resources to produce everything that everyone wants. Therefore, societies must decide how the limted resources are to be used and allocated among the people. So, they put these in place: |
ECONOMIC SYSTEM |
|
|
An ECONOMIC SYSTEM is the plans and policies for the use, production, and allocation of the limited resources by which it is determined: |
-WHAT AND HOW MUCH goods and services should be produced -HOW goods and services should be produced -WHO gets the goods and services that are produced |
|
|
Who determines what kind of economic system the state (country) will have? |
The state's POLITICAL SYSTEM, or GOVERNMENT |
|
|
The key issue in a country's economic system is: |
the amount or degree of government control or regulation of the nation's economy and business affairs. In other words, how much should the government be involved in economic desicions |
|
|
Societies with more polititical freedom = |
relatively free or unregulated economies
Think- democracy |
|
|
Societies with relatively less political freedom = |
economies that are under more government control
Think- communism |
|
|
Name 4 types of economic systems: CSDC |
1. Captialism 2. Socialism 3. Democratic socialism 4. Communism |
|
|
Capitalism:
1. Who wrote about a capitalist economy? 2. What was the name of his book? 3. What concept did he indorse? 4. What did he beleive would guide the economy? |
1. Adam Smith 2. Wealth of Nations 3. Laissez-faire: the gov should leave the economy alone 4. The invisible hand: actions of buyers and sellers will result in the best economic results |
|
|
What are 6 characteristics of a capitalist economy? |
1. private ownership/control of property and economic resources 2. free enterprise 3. little gov control/regulation 4. competition 5. freedom of choice (buyer/seller choices not limited by gov) 6. profit motive |
|
|
Socialism: an economic system in which the gov owns the basic means of... |
1. production, and 2. determines use of resources, 3. distribute products/wages, 4. provide social services (education, health care, and welfare) |
|
|
Main beleif of socialism system: |
the gov should direct the economy to distribute goods and wealth more equally |
|
|
And how do governments functioning in a socialistic system accomplish the redistribution of goods and wealth? |
through taxation |
|
|
What are some arguments against socialism? |
1. it is a disincentive to individual initiative and investment 2. socialism requires high tax rates which hinder economic growth 3. socialism requires increased gov regulation resulting in "big" government (possibly leading to a dictatorship) |
|
|
Democratic Socialism (welfare state) is where countries are committed to democracy, but... think "mixed economy" |
1. they believe gov should own/control resources and industries and make economic decisions to insure equal distribution of g/s 2. the gov provides many social services (health care, education, welfare, etc.) 3. there are higher taxes (necessary for the many social services) Ex. Denmark, Sweden, Norway |
|
|
Communism 1. Who wrote about communism? 2. What was the name of his book? 3. What was his basic belief about capitalism? |
1. Karl Marx 2. The Communist Manifesto 3. He believed that capitalism was inherently unfair and resulted in the unequal distribution of wealth |
|
|
Who were the "players" in the economy according to Marx? |
1. The proletariat (workers) 2. Bourgeoisie (owners of factories of production) 3. Capitalists (ruling class with power over resources) |
|
|
Karl Marx believed that the capitalist system would collapse and that there would only be on "class"- |
the working class, who would own and control all property equal |
|
|
In pure Communism, there would be no need for government because... |
everyone would be equal |
|
|
What type of economic system do communist nations have? |
a command economy |
|
|
In a command economy: |
1. the gov plans/decides what/how much/ and how to distribute goods and services 2. upper levels of gov make decisions and pass to lower level managers who carry out 3. the state owns/controls limited resources 4. it is the state who contols mass communication (newspapers, magazines, television, radio, internet, etc.) |
|
|
Does pure capitalism or pure communism exist in reality? |
NO, they are theoretical |
|
|
Most capitalist economies today, including the US, are actually MIXED ECONOMIES: |
elements of capitalism and socialism are both present |
