Economic Sectors, systems, Trade

Primary Sector

Makes living off of the land, can make a lot of money

Primary Sector Issues

Can't progress here, want to move on
Weather + Supply and Demand are out of control (things can go bad and economy can fail)
People turning to lab grown meat

Secondary Sector

Manufacturing raw materials into products
Factory jobs give higher standard of living

Secondary Sector Issues

Mobility - factories are built anywhere and companies move wherever labor is cheapest
Automation - replacing human workers with robots (massive cost cuts)

Tertiary Sector

Service sector - things finances, designed, sold, and repaired
Keeps population in the economy/working

Tertiary Sector Issues

Mobility and Automation, paying less for workers overseas, AI replacing humans
Income inequality between high and low skill

Formal Sector

Salaried or wage-based work registered in official statistics

Informal Sector

A sector of the economy that is not regulated or taxed by the state

Free Market Capitalism

Gov. stays out of things, allows "market forces" to determine what is bought, sold, + rendered
Rules not needed b/c market is self correcting (supply and demand)
Pursuing self interest created diverse economy
Gov. protects workers

Socialism

Production and distribution decided by gov. + individuals rely on state for everything (food, healthcare)
Gov. workers become upper class

Communism

Truly egalitarian society, no need for gov. to manage economy
Community owns and distributes everything
Everyone benefits from everyone's work
End goal of socialism

Capitalism

Money, businesses, decision making lies in other hands
Must regulate market and make rules
-Investors/workers/consumers/environment are protected
-Monopolies do not form
-Ownership of intellectual property (trademarks, patents) is respected (cannot profit off of other people's ideas)
-Borders are managed

U.S. Attitudes

Kept taxes low/regulations light so people don't starve
"Cannot" vs "Will not" most people just don't want to work
1. Everyone gets education
2. Infrastructure is built and maintained
3. Floor where people can't fall below

European Attitudes

Everyone lives in middle class
High taxes provides for free health care (worse than in the U.S.), tuition, paid maternity leave, vacation
Europe moving into Stage 4 so they are trying to get people to keep working

State/Authoritarian Capitalism

Everything controlled by gov. (private businesses)
Gov. has sole rights to make plans for economy, what industries it will allow to function, ect.
Businesses share everything with gov.
Leaders come first, economic freedoms can be taken away if you/your industry no longer strengthen those in power

Authoritarian Socialism/Communism

Gov. forcibly takes over (nationalizes) and runs everything, people have to do whatever job gov. assigns them
Gov. provides everyone with food and housing, decides what is produced
Enforces equality to move to Communism-no one can have more or less
People who run the country get rich and citizens struggle to survive

Gross Domestic Product (GDP)

Total of all economic transaction that take place within a country
Measures the "size" of economy

Official Exchange Rate (OER)

Adds up all activity in country in its currency rate and converts the amount into U.S. dollars

Purchasing Power Parity (PPP)

Reflects cost of living differences between countries
If cost of living is lower people feel richer and OER figure is adjusted up

GPD Per Capita

GPD divided by total population - gives rough measure of individual income within a country and idea of how successful people may be in a country

GPD Growth Rate

Change in GPD measured annually
Snapshot of how economy is doing at any given time
If growth is positive, economy is doing well
If growth is negative, economy is in trouble(shrinking) two negative quarters = rescission
Look at present GPD then past to compare accurately

Top Countries in Total GPD

1. USA $19.4 Trillion
2. China $12.01 Trillion
3. Japan $4.9 Trillion

PPP Top Countries

1. China $23 Trillion
2. USA $19.4
3. India $9.5

Highest GPD Per Capita

1. Liechtenstein $139,000
2. Qatar $124,500
3. Monaco $115,700

Lowest GPD Per Capita

1. Burundi $700
2. Central African Rep. $700
3. D.R. Congo $800

Developed Country

High standard of living, good infrastructure, internet connection, quick communication
Diverse and specialized jobs done with industrialization - mostly urban
Choices and competition

Developing Country

Mostly poor but improving- children doing better than parents
Some education, better opportunities + skill in urban area but rural struggling
Infrastructure improving - don't drink water (have access to healthcare, jobs, education)
rural impoverished

Underdeveloped Country

Cycle of poverty - people can't improve agriculture
No one making progress, gov. doesn't have resources b/c economy sucks
Nothing happens b/c of chronic conflict/really poor governance

Globalization

Interaction + integration of people and companies across the world (open trade and communication)
Increase competition decrease price, more opportunities + economic growth
Bad because people lose jobs b/c of offshoring
Might put too much pressure on the market

Outsourcing

Choosing to hire outside firm to accomplish a task instead of doing it yourself
Within country

Offshoring

Outsource outside of U.S. headquarters in another country takes advantage of lower wages elsewhere - don't have to pay for benefits
Not fully manufactured in U.S.
Outside of country

Protectionism

Rejection of global trade to insulate domestic businesses from foreign competition
Can be accomplished through outright bans on imports

Tariffs

Taxes placed on imported goods to raise their prices and make them less competitive with goods produced within borders

Subsidies

Financial help given by gov. to domestic firms used to pay for research and development/allow a company to sell goods @ low price so it would lose money

Nationalization

Situation where gov. takes over private business
Owner may/may not be compensated
Make sure business + money cycle flows and people have jobs

Nordic Countries Happiness

They trust in their government
Have social goods - Free healthcare, education, paid leave
Low unemployment

Latin American Countries Happiness

Culture puts more emphasis on relationships with friends and family, and religion
Doesn't worry about education, wealth, work, standard of living, or housing
High quality community and someone to count on

Top Oil Producers

1. USA (17.9 million barrels per day)
2. Saudi Arabia (12.4)

Top Oil Consumers

1. USA (19.7 million barrels per day)
2. China (12.8)

Conventional Oil

From underground reservoirs (drilling/pumping)
Offshore (expensive, large)

Unconventional Oil

Not recovered w/ drilling/pumping
Oil sands mining - mines heavy oil/oil found in formations difficult to extract from
LTO (Light Tight Oil) - non traditional techniques to extract from underground reservoir

Top Coal Producers

1. China
2. India

Top Natural Gas Producers

1. USA
2. Russia

Natural Gas Pros and Cons

Pros
- low cost
- domestic availability
- established distribution network
Cons
- diccicult to transport and store (leakage, pipelines)
- flammable and toxic
- nonrenewable

Coal Pros and Cons

Pros
- massive global stores
- inexpensive and reliable
- compatible, creates jobs, and independent
Cons
- nonrenewable, unclean energy
- devastation of environment
- costly transportation

THE TRANSITION

Autocratic China may gain clout b/c they make new tech.
China controls most refining minerals
Transition of petrostates - will fight for market share
Don't have time to ease into clean energy

THE TRANSITION VOLUME 2

Energy Investment 1/2 the level needed to reath Net Zero by 2050 (people need to spend more on clean energy)
Geopolitics, rich democracy quit fossil fuel and supply moves to autocracies with low costs
Flawed design of energy markets

Food Waste Devolped vs. Developing Countries

56% of the total food waste occurs in developed countries
44% occurs in developing countries

Green Revolution

Agricultural revolution that increased production through improved seeds, fertilizers, and irrigation

Solution to Food Demands

Be better farmers, better seeds, irrigation, and tech.
Shift diets, each more veggies
Reduce waste, smaller portions, eat left overs
Eat insects, healthier (more protein, less fat), cheap, more sustainable (no greenhouse gases)

Water Problems

Climate change causing glacier water to disappear
Water is not in infinite supply
Droughts increasing

Solution to Water Problems

Increase efficiency of water used
Shift away from water intensive uses
Groundwater storage, dams
Desalination of seawater