Transcript Unit 7 Types of economies I

I. Types of Economies:
A.
B.
Answer key economic questions of what to
produce, how to produce, for whom to
produce
Traditional Economies
1.
2.
relies on custom, culture, or ritual to decide
revolves around family/community
C.
Market Economies1.
2.
D.
free market, free enterprise, capitalism
choices made by individuals and companies to
decide, not gov’t
Command Economies1.
2.
centrally planned economy
the central gov’t alone decides
E.
Mixed Economies1. combination of other
three economies
2. most modern
economies are mixed
3. US is a free market
economy but the
gov’t intervenes to:
1. keep order
2. Regulate
3. provide services
4. promote general
welfare
Which phrase do you agree with?

“from each
according to his
abilities, to each
according to his
needs”

“every man by
nature is first
interested in his
own care and is
more fit to care for
himself than any
other person”
II. Free Market Economies
A.
Adam Smith’s “Wealth of Nations” (1776)
1.
2.
called for restricting gov’t in the economy (laissezfaire- leave alone)
believed that competing self-interest would regulate
the economy (“the invisible hand”)
B.
C.
Self-Interest- personal gain is motivating
force in economy
Competition1.
2.
3.
D.
struggle among producers for consumer’s $
competition is regulating force in economy
keeps prices low and quality high
Advantages:
1.
2.
3.
4.
Economic efficiency
Economic freedom
Economic growth
Consumer sovereignty
III. Centrally Planned Economies
Government controls resources
and production
A.
Karl Marx’s
“Communist Manifesto”
(1848)
1.
2.
believed all politics and
history is driven by the
struggle of the proletariat
(workers) vs the
bourgeoisie (rich upper
class)
believed a socialist society
can only come after a violent
revolution
B.
Socialism
1.
2.
3.
philosophy based on
the belief that wealth
should be redistributed
throughout society
can allow for
democracy and private
ownership
in socialist countries,
gov’t often owns major
industries and uses
wealth for social
programs
C.
Communism
1.
2.
3.
centrally planned
economy with all
economic and political
power residing in the
central government
little to no private
ownership with
societal equality
communist
governments are
authoritarian- strict
obedience to the
government, no
individual freedom
7.01-2 Review
1.
The US economy is best described as
what type of economy?
a.
b.
c.
d.
Free-market
Command
Mixed
Traditional
2.
According to supporters of capitalism,
which country would be least efficient in
terms of adjusting supply to meet
demand?
a.
b.
c.
d.
Japan
Germany
Cuba
China
3.
4.
List the benefits of a free enterprise
system.
How do consumers demonstrate their
sovereignty in a market system?
5. Which of the following encourages
individual initiative?
a.
b.
c.
d.
Economic self-interest
Public property
Monopolies
Multinational corporations
6.
Which economic policy is most
associated with socialism?
a.
b.
c.
d.
Free trade
Competition
A guaranteed job
Economic freedom
7. According to supporters of free
enterprise, what makes an economy
inefficient?
a.
b.
c.
d.
Rejecting customs and traditions
Meeting wants instead of needs
Allocating scarce resources
Adding government regulations
8.
9.
Who owns many of the factors of
production in a socialist system?
What role does the US government play
in the economy?
10.
What is the main difference between
socialism and communism?
a.
b.
c.
d.
in communism, the government has social
programs to help the poor
in socialism, the government is always
authoritarian
in socialism, the government redistributes
wealth but allows private ownership
in communism, the government can be
democratic and protect individual liberties
Gross domestic product



GDP: Measurement of a nation’s wealth
The total market value of all final goods
and services produced in a country in a
given year, equal to total consumer,
investment and government spending,
plus the value of exports, minus the value
of imports
Per capita GDP: total GDP divided by a
nation’s population
 Used to compare economic success b/w
nations
Create your own Government
and Economy!


Imagine you are the ruler of a country. You
can choose what kind of country and
government it is. Pick what economic
system you will have in your country and
explain how your economy works. Is it a
traditional, market, command, or mixed
economy? How do you address the three
key economic questions? Give details and
imagination to your economic system.
Suggested length: 1 full notebook pages
Civics 7.07b
Labor Unions
I. Labor Movement
A.
B.
Labor Union- people of
same trade organizing to
get better conditions,
benefits, or pay
Rise of labor movement
1.
2.
during early 1900s, unions
were illegal
New Deal gave workers right
to organize, minimum wage,
overtime pay, and no child
labor
C.
Fall of labor movement
1.
2.
3.
right-to-work laws- ban mandatory union
membership
National Labor Relations Board (NLRB) oversees
elections and bargaining
unions have dropped in popularity
II. Negotiations
A.
Collective bargaining- when union and
company representatives meet periodically to
negotiate new labor contracts
B.
Labor tools
1.
2.
3.
protest and use of media
strike- union workers refuse to go to work until
demands are met
political contributions and lobbying
C.
Employer tools
1.
2.
3.
D.
cutting benefits
lockout- prevent people
from working
injunction- court order to
stop protest or strike
Third party
1.
2.
mediation- when a third
party helps to create a
compromise
arbitration- if
negotiations break down,
third party forces an
agreement