Section 3: Government and economics Democracy A governing system where the people take part in the decision making process People in a democracy vote and choose leaders ○ For Democracy to work well people must participate and stay informed Democracy is not just a governing system it’s a way of life All citizens are equal
Ancient Greeks ○ Formed the 1 st democracy Direct Democracy ○ All citizens with the right to vote play a role in every decision that is made Majority Rule ○ Decisions are made by the approval of the majority of the group The judgment of many is better than the judgment of a few
Other Governing systems Monarchy ○ Rule by one ○ King or Queen ○ Power is said to be given by God and is passed down through the generations Dictatorship ○ One person claims complete control ○ Rule is usually gained by force ○ Power is not inherited
Oligarchy Rule of the few ○ The people in control are the people with money or prestige These people are not elected they are in charge because they say they are
Economies around the world Economies are classified by industry Four types of industry 1. Primary industry- Natural resources include: farming, fishing, logging, and mining ○ Primary industry brings natural resources to market
2. Secondary industry ○ This industry turns a natural resource into a finished product ○ Using cotton to make clothes 3. Tertiary industry ○ Stores and trucking companies are examples of the tertiary industry ○ Provide goods and also services 4. Quaternary industry ○ This industry involves research, information gathering, or business management ○ Scientists, accountants, architects, lawyers are all people in the quaternary industry they are also part of the service aspect of the tertiary industry
How industry describes a country Developed countries ○ Countries that have well-established economies Developing countries ○ Countries with economies that are still being built GDP- Gross Domestic Product The measure of the total value of goods and services a country produces A developed country has a higher GDP than a developing country
Economic Systems Traditional economy ○ Has not changed, people do the same work they did in the past ○ Subsistence farming- Growing only enough food for you and your family Only making enough and never being able to improve their way of farming Command economy ○ The government or a central authority makes most of the economic decisions ○ The central authority controls both the farms and the factories ○ The government controls what and how much will be produced
Market economy ○ The people own and control business ○ They make their own choices about what goods and services will be produced and bought Market economies Supply-the amount of goods and services for sale Demand-How much of a product people want Free enterprise