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20 Cards in this Set
- Front
- Back
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Centrally planned |
Government ownership of economic resources and state planning |
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Mixed govt. |
Mixed govt. And private ownership of economist resource split rather evenly |
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Market |
Mostly private ownership of economic resources |
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Ex. Centrally planned |
Govt. Owns most land, factories and other economic resources and plans neatly all economic activity Welfare of the group is paramount Economic and social equality is goal Communist as needed Asia Eastern Europe Latin America |
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Central planning failed to |
Create economic value Provide incentives Achieve rapid growth satisfy consumer needs |
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Ex. Mixed economy |
Govt. And private parties share ownership of land, factories and other economic resources rather evenly Goals 1.low unemployment 2. Steady economic growth Equitable distribution of wealth Stagnant 1. State owned business less competitive 2. Prices and taxes higher, living standards mixed |
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Benefits of privatization |
Increase in economic efficiency Boost productivity Raise living standards |
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Market economy |
Private parties own most land, factories and other economic resources Supply and demand |
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Laissez-faire |
Less govt. Ineetference Free choices Free enterprises Price flexibility |
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Govt. Roles in market economy |
Enforce antitrust laws Preserve property rights Provide fiscal and monetary stability Encourage commerce in a nation Preserve political stability |
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National production. |
GDP value of goods and services that a nation produces during a one year period |
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National production cons |
Overlook certain transactions Ignore growth rate Averages can disguise regions May ignore purchasing power |
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Purchasing power parity |
Ability of 2 countries to buy the same good in the same country |
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Developed country |
highly industrialized, highly efficient and whose people enjoy a high quality of life |
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Emerging market country |
Newly industrialized countries plus those with potential to be newly industrialized |
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Newly industrialized country |
Recently greater national production and exports from an industry all operations |
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Developing country |
Poor infrastructure and extremely low personal income |
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Economic transition |
Fundamental reorganization of an economy and the creation of new free market institutions |
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Free market institutions |
5. Reforms 4. Reduce budget deficit and expand credit 3. Allow the "price mechanism" to determine prices and economic activity 2. Legalized private firms and private state owned assets within a property rights framework 1. Remove barriers to trade and investments/eliminate currency controls |
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Obsticles of transition |
1. Lack of managerial experience 2. Capital shortage 3. Environmental degradation 4. Cultural changes |
