Key Terms – Economy (2)/Politics Traditional Economy Bartering Command Economy Market Economy Politics Monarchy Republic Democracy Natural Rights Rule of Law Totalitarian Government Oligarchy Aristocracy

Traditional Economies and Bartering Traditional economy → economy in which families and communities produce the necessities of daily life and trade them among each other Commonly involves bartering, which is the trading of one set of goods and services for another

Command Economy Command economy → economic system in which the government dictates what is sold, how much of it is sold, and how much it sells for. It is commonly referred to as a 'planned economy' since the government usually sets up cycles for its economic activity

Market Economy Market economy → economy in which the consumers dictate what is produced, how much is produced, and its price. Commonly called the capitalist system and it tends to fluctuate greatly according to consumer trends.

Politics Politics → the art or science of government Government → system of rule by which people subscribe. Many different groups of people have experimented with different types of government systems. Some will fail while others succeed.

Government Systems There have been many different types of government systems since the first few were created more than 5,000 years ago in Mesopotamia. Governments change in accordance with the needs of their citizens.

Monarchy Monarchy → system of government which is ruled by one individual, usually a king or a queen. Monarchies were the first government systems to exist in large societies.

Republic Republic → system of government in which citizens select individuals as representatives of their political stances in government The republic is a form of government that was made popular by the Romans and still in use today.

Democracy Democracy → system of government in which many of the major political decisions and positions are decided by the governed Democracies were established by the Greeks initially and now exist in partial fashions in the world today

Natural Rights Natural Rights → rights and civil liberties that one is born with and are guaranteed by constitutions and bills of rights today Initially, governments did not protect human rights due to the rule of monarchs but over time civil liberties would be protected

The Rule of Law Upon choosing to live within a civilization and accepting its government, citizens forfeit a measure of their freedom to live under the protection of the rule of law. Rule of law → protection of one's rights under the legal protection of a constitution or set of laws.

Totalitarian Government During the early 20th Century, many parts of the world came under the rule of totalitarian governments. Totalitarian governments → governments in which the rulers have complete control over the lives of their citizens and the economic systems of their countries. Examples include Adolf Hitler, Josef Stalin and Benito Mussolini.

Oligarchies and Aristocracies Oligarchy → rule by a few, usually a landholding elite or group of elders Some early governments spread power across a few individuals to prevent the rule of one which could damage one's country Aristocracy → rule by the wealthy Early ancient governments were sometimes ruled by the wealthy since the wealthy claimed that their money was what fueled the economies and governments of their countries.