1. Economic Systems
How people and societies conduct the exchange of goods and services around the world.
Students will pair/share then share with their “family” one person from each family will share their family answer with the class. FE: supply/demand, private ownership, no govt involvement, Soc:

2. From each according to his ability, to each according to his deeds.
Number 1-4 in your notes. Next to each number write the economic system that you think goes with each phrase - using Free Enterprise, Socialism, Communism, and Traditional.
From each according to his ability, to each according to his deeds.
From each according to his ability, to each according to his needs.
Production is privately owned & operated for profit, usually in competitive markets.
Production is primarily for survival, but can be traded for other necessary goods.
10A

3. Answers…
Socialism (From each according to his ability to each according to his deeds.)
Communism (From each according to his ability to each according to his needs.)
Free Enterprise (Production is privately owned and operated for profit, usually in competitive markets.)
Traditional (Production is primarily for survival, but can be traded for other necessary goods.)
10A

4. Characteristics of Economic Systems
Fundamental Questions:
How involved is the government?
What is the principle that guides decisions about:
What should be produced?
How should it be produced?
Who gets what is produced?

5. Free Enterprise
How involved is the government? Free Enterprise is based on supply and demand, where products are produced by privately owned businesses with very little government involvement; What is the guiding principle? Supply and demand determines what is produced and the means by which it is produced. Individuals with the means to purchase the goods receives the product.

6. Socialism
How involved is the government? There is a greater level of government involvement – as the government determines and provides what is in the interests of the entire group. What is the guiding principle? Socialism is based on what is needed for the greater good instead of what the consumer desires. In pure socialism, products are made through collective labor, and those whom contributed to the labor receive the finished product.

7. Communism
How involved is the government? The government or a small elite group typically owns factories, businesses, and resource hubs. The government or elite group make all the decisions. What is the guiding principle? Communism is like socialism in that it is based on what is needed for the greater good and not the individual. Products are the result of collective labor, and those with the biggest need receive the finished product.

8. Traditional Traditional economies:
exist in less developed societies
usually consist of subsistence farming, or hunting/fishing and gathering
typically lack modern tools and production methods
operate a barter system for other necessary goods and services
are guided by traditions, customs and beliefs that pass from generation to generation

9. Free Enterprise Socialism Communism
Now, take what you have learned about these three economic systems and use what you know about other countries to classify each country into one of these economic systems using a chart similar to the one below. USA Cuba Japan China England Laos Sweden Canada N. Korea Mexico Vietnam Norway
Capitalism/
Free Enterprise
Socialism
Command/
Communism
10B

10. Capitalism/
Free Enterprise
Socialism
Command/
Communism
USA
Norway
China*
Sweden
Vietnam*
Canada
Cuba*
Japan
North Korea*
England
Laos*
Mexico
* - It’s important to understand that these countries have Communist governments, yet claim to practice Socialist economic systems. However, based on their economic practices, we know they use a Command, or Communist economy system, although most are moving more to the left.

11. Production of Goods & Services
Subsistence Agriculture v. Commercial Agriculture
Based on their names, what do you think the differences are between these two types of agriculture? How would you imagine that these differences manifest themselves?
Cottage Industries v. Commercial Industries
Based on their names, what do you think the differences are between these two types of industry? How would you imagine that these differences manifest themselves?
10C

12. Number your paper from 1-10
Number your paper from For each of the photos we are going to look at, tell me what type of production you see (Commercial or Subsistence).
11A
Might save this slide for another day…to discuss with the entire lecture over Levels of Economic Activity

14. Attachment #2