What
is Economic System ?
Back
Ground :
The twentieth century was a very diverse time period
for the world's economic systems. The world suffered through two shooting
wars, a Cold War between the Super Powers, a Great Depression, and a shifting of
the balance of world economic power. By the end of the century, Communism had come and gone in Russia,
and the United States, Japan, and the European
Union emerged as the leading economic strength behind strong capitalist economies.
Economic
System :
“An
economic system is a system of production and exchange of
goods and services as well as allocation of resources in a society “
Explanation
:
An economic system is comprised of the various processes of organizing and motivating labor, producing, distributing, and circulating of the fruits of human labor, including products and services, consumer goods, machines, tools, and other technology used as inputs to future production, and the infrastructure within and through which production, distribution, and circulation occurs. These processes are overdetermined by the political, cultural, and environmental conditions within which they come to exist. In comparative economic systems, these economic systems are usually defined within determinate political boundaries. Thus, one would speak of a Chinese economic system, although China may, in fact, be a complex conglomeration and interaction of economic systems. Nevertheless, bounding economic systems in this way provides a way of discussing how such systems are made possible and changed by the specific effects of politico-institutional, cultural, and environmental differences.
An economic system is comprised of the various processes of organizing and motivating labor, producing, distributing, and circulating of the fruits of human labor, including products and services, consumer goods, machines, tools, and other technology used as inputs to future production, and the infrastructure within and through which production, distribution, and circulation occurs. These processes are overdetermined by the political, cultural, and environmental conditions within which they come to exist. In comparative economic systems, these economic systems are usually defined within determinate political boundaries. Thus, one would speak of a Chinese economic system, although China may, in fact, be a complex conglomeration and interaction of economic systems. Nevertheless, bounding economic systems in this way provides a way of discussing how such systems are made possible and changed by the specific effects of politico-institutional, cultural, and environmental differences.
Types
:
There
are five major types of economic system.
· Capitalism
·
Socialism
·
Mixed
·
Communism
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