Economic Systems

Flashcards covering key concepts and definitions related to economic systems, including types, principles, and implications in various economic contexts.

What is an economic system?

An economic system is the system of production, distribution, and consumption of goods and services of an economy.

What is bartering?

Bartering is a medium in which goods or services are directly exchanged for other goods and/or services without the use of money.

What does capitalism refer to?

Capitalism refers to an economic system where the means of production are mostly privately owned and operated for profit, and market forces determine pricing.

How is collectivism defined in economics?

Collectivism holds that some things should be owned by the group for the benefit of all rather than by individuals.

What is a command economy?

A command economy is one where the means of production are publicly owned, and the government plans the economy.

What are staple commodities?

Staple commodities are raw materials exported to other countries, such as fish, fur, lumber, and minerals.

What is communism?

Communism is an ideology that seeks to establish a classless, stateless society based on common ownership of the means of production.

How does competition function in economics?

Competition incentivizes self-improvement and leads to lower prices and better products as businesses strive for customers.

What is consumption?

Consumption refers to the selection, adoption, use, disposal, and recycling of goods and services.

What is meant by free trade?

Free trade is a market model where trade in goods and services flows without government-imposed restrictions.

What is globalization?

In economics, globalization refers to the convergence of prices, products, wages, and profits towards norms of developed countries.

What is a green economy?

A green economy aims to address the interdependence of human economies and natural ecosystems to prevent adverse impacts of economic activities.

What is the difference between a 'hands-off' and a 'hands-on' economic system?

A 'hands-off' system limits government involvement in the economy, while a 'hands-on' system has a greater role for society or government in economic decision-making.

What is nationalization?

Nationalization is the act of a nation taking possession of assets without requiring the owner's consent.

What is socialism?

Socialism is characterized by socialized ownership of the means of production.

What does 'productivity' mean in economics?

Productivity refers to the amount of output created per unit of input used.

What is a subsidy?

A subsidy is financial government assistance to encourage the production or purchase of a good.

What are raw materials?

Raw materials are materials in their unaltered state that are extracted or harvested and later processed for production.

What is a traditional economy?

A traditional economy is based on custom and tradition, where resources are allocated by inheritance.

What are wants and needs in economics?

Wants are things that are desired or needed, while needs are essential for basic survival.

What is wealth?

Wealth encompasses all goods and resources that have value in terms of exchange or use.

What is welfare economics?

Welfare economics determines allocative efficiency andIncome distribution within an economy.