Economic Systems Overview

Flashcards covering key vocabulary and concepts related to economic systems.

Economic System

A set of institutional arrangements and a coordinating strategy to address the problem of scarcity.

Laissez-faire Capitalism

An economic system where the government protects private property and establishes a legal framework but otherwise leaves economic decisions to market forces.

Command Economy

An economic system where the government owns resources and makes economic decisions through planning bureaus.

Mixed Economy

An economic system that incorporates elements of both market and command economies.

Invisible Hand

A metaphor by Adam Smith representing how individuals' self-interest can lead to societal benefits.

National Development Plan 2030

A South African initiative aimed at uniting citizens to eliminate poverty, reduce inequality, and promote economic growth.

Creative Destruction

A concept by Joseph Schumpeter where new products replace outdated ones, driving innovation.

Private Property Rights

Legal rights that allow owners to obtain, use, and dispose of property, which encourages investment and exchange.

Market Signals

Changes in prices and profits that communicate demand and supply conditions in the economy.

Technological Progress

Advancements that improve the production processes and create better products, driving economic growth.