Ap Comparative Government Ch.4 Key Terms

Front 1

political economy

Back 1

The study of how politics and economics are related and how their relationship shapes the balance of freedom and equality

Front 2

markets

Back 2

the interaction between the forces of supply and demand, and they allocate resources through the process of that interaction.

Front 3

property

Back 3

Refers to the ownership of goods and services

Front 4

property right

Back 4

The right to buy and sell property or the right not to have it taken away by the state or other citizens without a good reason (just cause) and compensation.

Front 5

public goods

Back 5

Goods that are provided or secured by the state, available for society and indivisible (no one private person or organization can own them)

Front 6

social expenditures (welfare)

Back 6

The state's provision of public benefits, such as education, health care, and transportation, or what is called "welfare" or the "welfare state"

Front 7

taxation

Back 7

The means by which the state collects the funds to pay for public goods and services--- which, in the end, benefit the public directly.

Front 8

central bank

Back 8

An institution that controls how much money is flowing through the economy, as well as how much it costs to borrow money in that economy.

Front 9

inflation

Back 9

When prices begin to rise and money loses its values.

Front 10

unemployment

Back 10

Having no jobs due to economic problems like inflation.

Front 11

regulation

Back 11

Rules or orders that set the boundaries of a given procedure.

Front 12

monopoly

Back 12

A single producer of a good or service that is able to dominate the market.

Front 13

trade

Back 13

The act or process of buying, selling, or exchanging commodities, at either wholesale or retail, within a country or between countries.

Front 14

tariffs

Back 14

Taxes on imported goods.

Front 15

quotas

Back 15

A nontariff that limits the quantity of a good that may be imported into a country

Front 16

comparative advantage

Back 16

The ability to produce a particular good or service more efficiently relative to other countries' efficiency in producing the same good or service.

Front 17

capitalism

Back 17

A system of production based on private ownership and free markets.

Front 18

laissez-faire

Back 18

Holds that the economy should be "allowed to do" what it wishes.

Front 19

parastatals

Back 19

Partial or full state ownership of specific industries.

Front 20

gross domestic product (GDP)

Back 20

Total market value of all goods and services produced within a country over a period of one year.

Front 21

gross national product (GNP)

Back 21

Both production and the flow of the wealth into and out of a country, with attention to national versus foreign ownership

Front 22

purchasing-power parity (PPP)

Back 22

Attempts to estimate the buying power of income in each country by comparing similar costs, such as food and housing, using prices in the United States as a benchmark.

Front 23

gini index

Back 23

A statistical formula that measures the amount of inequality in a society; its scale ranges from 0 to 100, where 0 corresponds to perfect equality and 100 to perfect inequality.

Front 24

human development index

Back 24

A statistical tool that attempts to evaluate the overall wealth, health, and knowledge of a country's people.

Front 25

economic liberalization

Back 25

Changes in the areas that limit the power of the state over that of private property and market forces.