The econom

Apuntes

The economic organisation of society UNIT 1 ECONOMIC SYSTEMS • The sets of rules and customs that govern production and the exchange of goods and services. • Through history we find numerous economic systems but today capitalism is predominant. LOS SISTEMAS ECONÓMICOS • Subsistence economy: no surplus, related to very under-developed societies. • Feudal economy: agriculture is the main economic activity. Surplus is taken by the nobility. • Mercantilism: trade is the main economic activity. THE CAPITALIST SYSTEM/MARKET ECONOMY • Prices are regulated through supply and demand. • Free initiative to create companies. • Private ownership of the means of production. • Little intervention of the State in the economy. • Economic agents are free to operate to maximise profit. • Free competition between companies. • Overproduction crises happen cyclically. STATE PLANNED ECONOMIES/SOCIALIST ECONOMIES • The State controls the economic agents. • State or collective ownership of the means of production. • Ample wellbeing services and welfare systems. • Not very common today, MIXED ECONOMIES • Combine capitalist system with some elements of planned economies. • Companies and people are the main e...