Essay On Economic System

1310 Words3 Pages
bulb-icon

Recommended: The perspective of history

1 INTRODUTION 1.1 WHAT IS AN ECONOMIC SYSTEM Swanepoel and Van Zyl (2000:77) explicitly explain an economic system as a “set of distinctive mechanisms, institutions, organisations, rules and orders that are used to address certain issues which are common to all economies”. It is then clear that the four widely used economic systems rose from the basic economic decisions or questions that were imposed by scarcity. The currently most established and commonly practised economic system among; command, traditional, market and mixed economy, is the mixed economy. More Economically Developed Countries justify that decision by saying that a balance should be maintained in the economy of a country thus all participants are represented in the mixed economic system. That doesn’t cease to make one wonder if it is the best among the four to be used so widely more especially by developing countries who most are still baptised by the traditional economic system. The level of transparency displayed by the economic systems is still to be studied paying more attention to the mixed economy as the currently commonly practised system. 2 LATERARY REVIEW 2.1 ECONOMIC SYSTEMS HISTORY 2.1.1 traditional economic system Traditional economy is defined as an economy in which society uses primitive tools to harvest and ancient methods of production of any good, leaning more on passed on generational knowledge resulting in poor economic growth (InvestorWords,2009). This economic system is the oldest or most ancient as it has the foundation based on answering economic questions with strong attachments of custom. The survival habits are often reinforced by superstition and religious beliefs thus forbidding any change in the production procedure as it is seen as ... ... middle of paper ... ...the capitalist nature and socialist nature (Harvey. 1991:19) Delays cause the control measure to be ineffective 5 CONCLUSION As Evensky (2005:110) said that self-love is the fundamental assumption that humans are homo economicus species, entirely motivated by self-interest symbolising core market economy. It is proven though that self-interest is not adequate for a country to be economically and politically established thus the public sector is summed with private sector. Therefore it has been beneficial toSouth Africa that it implemented mixed economy as the system promotes well it’s major vision as a country. The vision is to uphold the South Africa’s institutional values which enforces equality, freedom and dignity for all South Africans (Mtyala, 2014:6) and all of that couldn’t be entirely fulfilled by both the market system and the command system separately.

Show More
Related

  • economic systems in copan compared to other ancient cultures

    1103 Words  | 3 Pages

    Throughout history there has been a common theme of progression towards more complex societies. The advent of agriculture enabled population sizes to increase, and allowed permanent settlements to arise. As extensive cultivation of farmland progressed, a surplus of food was created that enabled some people within a society to be non-food producers. These people who no longer were required to farm in order to survive were able to develop marketable goods that they could exchange for food. This transition towards interdependence, (craftsmen depending on exchanging their goods for food), brought with it an opportunity for the government within each society to exact some tribute for monitoring the economy, and making sure that exchanges went smoothly. This led to societies with a well-defined hierarchy and slowly led to the abolition of the egalitarian societies where everyone engages in the same means of production. Within these aforementioned egalitarian societies there is some occupational specialization, but it is based on the skill of the craftsmen, and no one is a full time specialist. The differences in the economies of Copan, Teotihuacan, and ancient Rome, can illustrate why and how economies increase in complexity, and what criteria are necessary for large-scale economic specialization. More specifically, what factors limited Copan and Teotihuacan, preventing them from attaining the population size, and economic complexity of ancient Rome.

    Read More

  • The Three Different Types of Economies That Exist in the World

    557 Words  | 2 Pages

    There are three kinds of economic systems. They are as follows. One is an economic system with the name of “custom based economy”, it is a system that is mostly found in the third world countries. In the system, every child of every generation will be thought to use the same ideas to produce the same good...

    Read More

  • Pros And Cons Of Capitalism Debate

    517 Words  | 2 Pages

    Imagine a system in which everyone can gain wealth in a free market. A place where hard work actually pays off. Where freedom of speech actually allows unreserved opinion. This is a Capitalism. Resolution: Capitalism is the most basic form of economic system.

    Read More

  • American Market Revolution Essay

    1218 Words  | 3 Pages

    During the late 1700’s and well into the 1800’s, American’s lived through expansive growth including economic transformation, politics, labor classification, and increased population were a result of overall growth of the United States. This growth affected how the Americans lived, worked, voted, and were viewed by their fellow citizens. Americans were transforming the lives for financial gains, their own rights, and overall a more content life.

    Read More

  • The Role of Women in Ancient Times

    814 Words  | 2 Pages

    ...lated with the food production to make other produce, like pottery, leather goods and cloth. (Bairoch, p14) Economic specialization due to emergence of advanced technologies led to the creation of influential classes of leaders and social stratification. Regional fiscal specialization frequently centered on possessions indigenous to the area in which the group of people was situated. Trade was enhanced among areas having different goods and services so as to provide an equitable and reasonable distribution of products. Social stratification was limited in ancient agricultural communities. Property may have been owned communally by all members of the society which provided cheap labor. The role of women in agricultural sectors had declined and men took over the necessary responsibilities of agriculture and started to control the application of the new tools.

    Read More

  • Market Revolution Essay

    866 Words  | 2 Pages

    The market revolution caused the decline in small-scale production for local use into a rise in large-scale production in manufacturing. The market revolution is the expansion of the marketplace that occurred in early nineteenth century, the construction of new roads and canals that interconnected for the first time. The Erie Canal provided a successful source of transportation, states got involved and spent money into the transportation networks that stimulated economic growth. With the rise of the economic growth there comes problems. Although changes brought by the market revolution helped strengthen the United States economy, there were many effects from the market revolution that caused boom-bust cycles, class division, struggle in upward

    Read More

  • Classical Economics Essay

    1276 Words  | 3 Pages

    Classical economists such as, Jean Baptiste Say, Adam Smith, David Ricardo, and Thomas Robert Malthus, had a different view about the role of the government in a capitalistic society. The classical economists believed in a laissez-faire economy. They believed that the government should keep their hands off the nation’s economy. They felt that the market will be able to keep itself stable, without the intervention of the government. Jean Baptiste Say believed that supply would create its own demand. The classical economists had an assumption that the aggregate production of goods and services in the economy generate enough income to purchase all output. They also had the assumption that savings by the household sector matches investment expenditures on capital goods by the business sector.

    Read More

  • Capitalism Essay

    2337 Words  | 5 Pages

    Capitalism has never been dead and will be here for at least the next century. In a world where the market is filled with imperfections, it is in order for the government to interfere to restore order in the market. Increased concerns over the 2008 market collapse prompted the government’s to take charge of their responsibility and act. Capitalism is a system of government that favours individual growth with minimal government interference. The opposite of capitalism is communism, where the property owner is the state, and the main aim is social welfare enhancement. A mixed economy embraces the two and balances between the extremes. Many countries across the globe have adopted a mixed economy as it reduces the losses suffered by the countries that practice the extremes. Capitalism has been known to be responsible for growth of economies among them, the United States, Britain, and other developed countries. In this essay, we shall examine the future and nature of capitalism in the light of a mote communist future.

    Read More

  • Capitalism

    1237 Words  | 3 Pages

    The distinguished in the nineteenth century and it’s collapse in the twentieth century have led to similar, though much slower and less obvious, process in the course of modern science. Today’s frantic development in the field of technology has a quality reminiscent of the days preceding the economic crash of 1929. The clearest evidence of it may be seen in such comparatively young sciences such as psychology and political economy. In psychology, one may observe the attempt to study human behavior without reference to the fact that man is conscious. In political economy, one may observe the attempt to study and device social systems without reference to man. Political economy came into prominence in the 19th century, in the era of philosophies post kantian disintegration, and no one rose to check its premises or to challenge its base. Political economist-including the advocates of capitalism-defined their sciences as the study of management or direction or organization or manipulation of “community’s” or nations resources. The author goes on to say that the European culture regarded material productions as work that should be done by slaves or serfs but not first class citizens. It must be remembered that the institution of private property, in the full, legal meaning of the term, was brought into existence only by capitalism. In the pre-capitalist eras, private property existed de facto but not de jure, i.e. by custom and sufferance, not by right or by law. In law and in principle all land belonged to the head of the tribe, the king, and was held only by permission, which could be revoked at any time. CAPITALISM, a term used to donate the economic systems that has been dominate in the western world since the breakup of feudalism. Fundamental to any system called capitalist are the relations between private owners of non-personal means of production (land mines, industrial plants, etc.... collectively known as capital) and free but capitalizes workers, who sell their labor services to employers. The resulting wage bargains determines the proportion in which the total products of society will be shared between the class of laborers and the class of capitalist entrepreneurs. Productive use of the “social surplus” was special virtue that enabled capitalism to outstrip all prior economic systems. Instead of building pyramids and cathedrals, those in command of the social surplus chose to invest in ships, warehouses, raw materials, finished goods and other material forms of wealth.

    Read More

  • Analysis of Wealth of Nations by Adam Smith

    1044 Words  | 3 Pages

    development of the modern economic system in an attempt to explain it, maps out the

    Read More

  • Emergence of Market Society

    1722 Words  | 4 Pages

    Polanyi, Karl. "Societies and Economic Systems," "The Self Regulating Market and Fictitious Commodities: Labour, Land, and Money." "The Great Transformation. Boston: Beacon Press, 1957. pp. 43-55, 68-75

    Read More

  • Adam Smith's Wealth of Nations

    3049 Words  | 7 Pages

    Smith's formulation transcends a purely descriptive account of the transformations that shook eighteenth-century Europe. A powerful normative theory about the emancipatory character of market systems lies at the heart of Wealth of Nations. These markets constitute "the system of natural liberty" because they shatter traditional hierarchies, exclusions, and privileges.2 Unlike mercantilism and other alternative mechanisms of economic coordination, markets are based on the spontaneous and free expression of individual preferences. Rather than change, even repress, human nature to accord with an abstract bundle of values, market economies accept the propensities of humankind and are attentive to their character. They recognize and value its inclinations; not only human reason but the full panoply of individual aspirations and needs.3 Thus, for Smith, markets give full expression to individual, economic liberty.

    Read More

  • Feudalism and Capitalism

    3827 Words  | 8 Pages

    There are a number of fundamental questions that economic systems attempt to solve: How does one gain access to the resources needed to produce new and useful goods and services? How does one get humans to perform the labor? How do you organize the production process? How do you get the produced output into the hands of consumers? And finally, who gets the surplus and what do they do with it? Using these questions as a basic framework, one can attempt to dete...

    Read More

  • Socialism - The Best Economic System

    1465 Words  | 3 Pages

    Today, more than ever, there is great debate over politics and which economic system works the best. How needs and wants should be allocated, and who should do the allocating, is one of the most highly debated topics in our current society. Be it communist dictators defending a command economy, free market conservatives defending a market economy, or European liberals defending socialism, everyone has an opinion. While all systems have flaws and merits, it must be decided which system is the best for all citizens. When looking at the financial well being of all citizens, it is clear that market economies fall short on ensuring that the basic needs of all citizens are met.

    Read More

  • Economic Systems

    1104 Words  | 3 Pages

    Introduction Economic systems are organized ways in which a state or nation allocates its resources and apportion goods and services to the national community. An economic system is slackly defined as a country’s plan for its services, goods produced, and the exact way in which its economic plan is carried out. There are three types of economic systems exist, they are command economy, market economy, and mixed economy. Command economy is also sometimes called planned economy. The expectation of this type of economy is that all major decisions related to the construction or production, distribution, commodity and service prices are all made by the government.

    Read More

More about Essay On Economic System

Open Document