Economic Systems for AP World History

Flashcards for AP World History: Modern Economic Systems

Feudalism

A system where hierarchy, wealth, power and protection is established based on the ownership of land.

Land-Based Economy (Feudalism)

Land was owned by lords and they granted fiefs to vassals in exchange for military service.

Hierarchy (Feudalism)

A social structure between the king, nobles, knights, and serfs.

Serfdom

Peasants or serfs worked the land for the lords and were tied to the estate.

Manorialism

The economic system tied to feudalism, centered on self-sufficient agricultural estates or manors as the basic unit of production.

Self-Sufficiency (Manorialism)

Each manor produced everything it needed such as food, tools, and clothing.

Peasant Labor (Manorialism)

Serfs and peasants provided labor in exchange for protection and a place to live.

Mercantilism

An economic policy focused at increasing the national wealth through strict government control of trade.

Colonialism (Mercantilism)

Colonies supplied raw materials and served as exclusive markets for the country.

Favorable Balance of Trade (Mercantilism)

Encouraged exports over imports to accumulate precious metals like gold and silver.

Capitalism

An economic system where private individuals or corporations own the means of production and operate for profit.

Market Economy (Capitalism)

Prices and production are determined by supply and demand.

Socialism

A system advocating public or collective ownership of the means of production to reduce economic inequality.

Economic Planning (Socialism)

Government regulates production and distribution to meet societal needs.

Communism

A system advocating for a classless society where all property and resources are communally owned.

Abolition of Private Property (Communism)

Eliminate private ownership and focus on collective ownership.

Mixed Economies

Combines elements of capitalism and socialism, blending private enterprise with government intervention.

Command Economies

An economy where production and distribution of goods are entirely controlled by the government.

Centralized Control (Command Economies)

The state sets production targets, prices, and resource allocation that often leads to inefficiencies and shortages.

Free Market Economies

An economic system relying on market forces such as competition of privately owned businesses to determine production and prices.

Economic Freedom (Free Market Economies)

Businesses operate with minimal government intervention.

Globalization

The increasing interconnection and interdependence of economies, cultures, and societies worldwide through trade, investment, and culture.

Trade Integration (Globalization)

Growth of international trade and multinational corporations.