MARKETING 3.04 – COMPARING ECONOMIC SYSTEMS

THREE ECONOMIC QUESTIONS WHAT GOODS AND SERVICES SHOULD BE PRODUCED? HOW SHOULD THE GOODS AND SERVICES BE PRODUCED? FOR WHOM SHOULD THE GOODS AND SERVICES BE PRODUCED?

COMPARING ECONOMIES TRADITIONAL ECONOMY THREE QUESTIONS ANSWERED: “How things have always been done” TRADITION DECIDES EXAMPLES: Amish Community Indian Reservations

COMPARING ECONOMIES MARKET ECONOMY NO GOVERNMENT INVOLVED, THE MARKET ANSWERS THE THREE QUESTIONS: Consumers decide “WHAT.“ Businesses decide “How.” Consumers who are willing to pay determines the “FOR WHOM.”

COMPARING ECONOMIES COMMAND ECONOMY THE GOVERNMENT ANSWERS ALL THREE QUESTIONS: GOVERNMENT RUNS BUSINESSES. GOVERNMENT EMPLOYS PEOPLE. GOVERNMENT DECIDES WHO RECEIVES PRODUCTS.

MIXED ECONOMIES NOT COMPLETELY CONTROLLED BY THE GOVERNMENT. NOT A PURE MARKET SYSTEM. A MIX OR BLEND OF BOTH.

CAPITALISM PEOPLE ELECT THEIR GOVERNMENT OFFICIALS WHO REPRESENT THEIR INTERESTS. (UNITED STATES, JAPAN)

(CUBA, VIETNAM, NORTH KOREA) COMMUNISM GOVERNMENT CONTROLLED BY ONE PARTY. PEOPLE ARE ASSIGNED JOBS. LITTLE FREEDOM OF CHOICE. PEOPLE DO NOT PAY FOR MEDICAL CARE. (CUBA, VIETNAM, NORTH KOREA)

(CANADA, FRANCE, GERMANY) SOCIALISM COUNTRIES ARE CAPITALISTIC WITH INCREASED GOVERNMENT INVOLVEMENT. REDUCES THE DIFFERENCE BETWEEN RICH AND POOR. BASED ON WELFARE FOR THE PEOPLE. (CANADA, FRANCE, GERMANY)

Works Cited www.ncdpi.com/curriculum

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