Thursday August 28, 2014 Mr. Goblirsch – Economics OBJECTIVE – Students Will Be Able To – SWBAT: - Analyze 2 opinions about Capitalism, and explain why most “modern” economies today are mixed economic systems. AGENDA: WARM-UP: Current Event Article – Dust Bowl VIDEO CLIPS: Why Capitalism Works (4 min) Does Capitalism Exploit Workers? (6 min) INSTRUCTION: Modern Mixed Economies INDEPENDENT PRACTICE: Ch 2 Sec 2&4 Workbook Pgs. 21 & 23 CLOSURE: Mixed Economies Wrap-Up Current Event Article – Dust Bowl WARM-UP: (Follow the directions below) ***5 minutes*** Read and Analyze the Modesto Bee article on the Turlock Dust Bowl Brewery: While reading, highlight/underline points that relate to some of the fundamental economic concepts we have discussed. When you’re done reading, write a brief summary of the economic concepts this article demonstrates.

Modern Economies Why are many modern economies mixed economies? What role does the government play in a mixed economy? How do mixed economies in different countries compare? What role does free enterprise play in the United States economy?

The Rise of Mixed Economies Market economies, with all their advantages, have certain drawbacks. Limits of Laissez Faire Laissez faire is the doctrine that government generally should not interfere in the marketplace. Governments create laws protecting property rights and enforcing contracts. They also encourage innovation through patent laws.

Government’s Role in a Mixed Economy The government purchases land, labor, and capital from households in the factor market, and Purchases goods and services in the product market. monetary flow physical flow Circular Flow Diagram of a Mixed Economy Households Firms Product market taxes government purchases Government expenditures government-owned factors taxes Factor market

Section 4: Modern Economies Government Intervention National Defense Roads & Highways Social goals Public transportation Education Healthcare Gov as an umpire Protect Private Property Rights Passing laws to protect competition

Comparing Mixed Economies An economic system that permits the conduct of business with minimal government intervention is called free enterprise. The degree of government involvement in the economy varies among nations. Look at Index of Economic Freedom – www.heritage.org Continuum of Mixed Economies Centrally planned Free market Source: 1999 Index of Economic Freedom, Bryan T. Johnson, Kim R. Holmes, and Melanie Kirkpatrick Iran North Korea Cuba China Russia Greece Peru United States South Africa France United Kingdom Botswana Canada Singapore Hong Kong

CLOSURE: Mixed Economy Wrap-Up Discuss with your partner why the “modern” economy is a mix of the Free Market and Centrally Planned economic systems.