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Significant Economic Systems to Know for AP World History: Modern
1. Feudalism
Definition
A system where hierarchy, wealth, power and protection is established based on the ownership of land.
Key Features
Land-Based Economy: land was owned by lords and they granted fiefs to vassals in exchange for military service.
Hierarchy: There was 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.
Loyalty and Obligations: Relationships were based on protection for labor and military aid.
2. Manorialism
Definition
The economic system tied to feudalism, centered on self-sufficient agricultural estates or manors as the basic unit of production.
Key Features
Self-Sufficiency: Each manor produced everything it needed such as food, tools, and clothing.
Peasant Labor: Serfs and peasants provided labor in exchange for protection and a place to live.
Limited Trade: Trade was minimal; most goods were produced and consumed locally.
3. Mercantilism
Definition
An economic policy focused at increasing the national wealth through strict government control of trade.
Key Features
Colonialism: Colonies supplied raw materials and served as exclusive markets for the country.
Favorable Balance of Trade: Encouraged exports over imports to accumulate precious metals like gold and silver.
Government Intervention: Heavy regulation of trade, tariffs, and monopolies to control resources and markets
4. Capitalism
Definition
An economic system where private individuals or corporations own the means of production and operate for profit.
Key Features
Market Economy: Prices and production are determined by supply and demand.
Innovation and Competition: Profit motive that drives technological advancement and innovation.
Uneven Wealth Distribution: Leads to social and economic disparities.
5. Socialism
Definition
A system advocating public or collective ownership of the means of production to reduce economic inequality.
Key Features
Economic Planning: Government regulates production and distribution to meet societal needs.
Redistribution of Wealth: Policies aim to reduce income inequality by distributing wealth evenly among the population.
Taxation: Taxes are use for extensive social welfare programs and public services
6. Communism
Definition
A system advocating for a classless society where all property and resources are communally owned.
Key Features
Abolition of Private Property: Eliminate private ownership and focus on collective ownership.
Centralized Economic Control: Associated with authoritarian regimes that suppress dissent. Also, the government dictates all aspects of the economy.
7. Mixed Economies
Definition
Combines elements of capitalism and socialism, blending private enterprise with government intervention.
Key Features
Private and Public Sectors: Coexist to balance economic freedom, inequalities, and social welfare
Regulation: Governments regulate industry to correct market failures.
8. Command Economies
Definition
An economy where production and distribution of goods are entirely controlled by the government.
Key Features
Centralized Control: The state sets production targets, prices, and resource allocation that often leads to inefficiencies and shortages.
Lack of Competition: No private businesses or free market.
9. Free Market Economies
Definition
An economic system relying on market forces such as competition of privately owned businesses to determine production and prices.
Key Features
Economic Freedom: Businesses operate with minimal government intervention.
Consumer Choice: Individuals drive demand and innovation.
Inequalities and failures: Can result in economic growth but may have inequalities and market failures.
10. Globalization
Definition
The increasing interconnection and interdependence of economies, cultures, and societies worldwide through trade, investment, and culture.
Key Features
Trade Integration: Growth of international trade and multinational corporations.
Technology: Advances in communication and transportation.
Cultural Exchange: Diffusion of ideas, goods, and practices.
Significant Economic Systems to Know for AP World History: Modern
1. Feudalism
Definition
A system where hierarchy, wealth, power and protection is established based on the ownership of land.
Key Features
Land-Based Economy: land was owned by lords and they granted fiefs to vassals in exchange for military service.
Hierarchy: There was 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.
Loyalty and Obligations: Relationships were based on protection for labor and military aid.
2. Manorialism
Definition
The economic system tied to feudalism, centered on self-sufficient agricultural estates or manors as the basic unit of production.
Key Features
Self-Sufficiency: Each manor produced everything it needed such as food, tools, and clothing.
Peasant Labor: Serfs and peasants provided labor in exchange for protection and a place to live.
Limited Trade: Trade was minimal; most goods were produced and consumed locally.
3. Mercantilism
Definition
An economic policy focused at increasing the national wealth through strict government control of trade.
Key Features
Colonialism: Colonies supplied raw materials and served as exclusive markets for the country.
Favorable Balance of Trade: Encouraged exports over imports to accumulate precious metals like gold and silver.
Government Intervention: Heavy regulation of trade, tariffs, and monopolies to control resources and markets
4. Capitalism
Definition
An economic system where private individuals or corporations own the means of production and operate for profit.
Key Features
Market Economy: Prices and production are determined by supply and demand.
Innovation and Competition: Profit motive that drives technological advancement and innovation.
Uneven Wealth Distribution: Leads to social and economic disparities.
5. Socialism
Definition
A system advocating public or collective ownership of the means of production to reduce economic inequality.
Key Features
Economic Planning: Government regulates production and distribution to meet societal needs.
Redistribution of Wealth: Policies aim to reduce income inequality by distributing wealth evenly among the population.
Taxation: Taxes are use for extensive social welfare programs and public services
6. Communism
Definition
A system advocating for a classless society where all property and resources are communally owned.
Key Features
Abolition of Private Property: Eliminate private ownership and focus on collective ownership.
Centralized Economic Control: Associated with authoritarian regimes that suppress dissent. Also, the government dictates all aspects of the economy.
7. Mixed Economies
Definition
Combines elements of capitalism and socialism, blending private enterprise with government intervention.
Key Features
Private and Public Sectors: Coexist to balance economic freedom, inequalities, and social welfare
Regulation: Governments regulate industry to correct market failures.
8. Command Economies
Definition
An economy where production and distribution of goods are entirely controlled by the government.
Key Features
Centralized Control: The state sets production targets, prices, and resource allocation that often leads to inefficiencies and shortages.
Lack of Competition: No private businesses or free market.
9. Free Market Economies
Definition
An economic system relying on market forces such as competition of privately owned businesses to determine production and prices.
Key Features
Economic Freedom: Businesses operate with minimal government intervention.
Consumer Choice: Individuals drive demand and innovation.
Inequalities and failures: Can result in economic growth but may have inequalities and market failures.
10. Globalization
Definition
The increasing interconnection and interdependence of economies, cultures, and societies worldwide through trade, investment, and culture.
Key Features
Trade Integration: Growth of international trade and multinational corporations.
Technology: Advances in communication and transportation.
Cultural Exchange: Diffusion of ideas, goods, and practices.
