Essay Review Economic Systems Components of the Regents

Essay Review Economic Systems!

Components of the Regents Essay • F – Facts, Evidence & Details (the explanation, specifics and substantiation of the essay) • O – Organization (Introduction, Body Paragraphs & Conclusion) • L – Level of Analysis (the long-range or immediate impact of the information on a society or on history) • D – Development of the Task (the bullets of the task)

The Economic Systems Essay! Task: Identify one society and one economic system that has been used or is being used in that society: • Discuss the historical circumstances surrounding the development of that system • Describe two features of the economic system • Evaluate the impact that economic system had on this society during a specific historical period

Economic Systems Traditional Market Command Mixed • Based on agriculture • Limited barter trade • Neolithic Civilizations • Early River Valley Civilizations • Based upon Supply and Demand • Usually focus on consumer goods • Little government control • Controlled by strong, centralized government • Usually focuses on industrial goods • Little attention paid to agriculture and consumer goods • Combination of Market and Command economic systems • Market forces control most consumer goods • Government directs industry in need areas.

Essential Information for this Essay!

Manorialism *Western Europe During the Middle Ages* • Circumstances: – Tribal invasions made Europe a dangerous place – Peasants & Lesser lords exchanged labor & loyalty for land & protection • Features: – Manor system is selfsufficient – limited trade or travel – Land is the basis of wealth and power • Impact: – Trade slowed – System of De-Centralized and confusing political loyalties emerged – Few people ever leave the manor on which they are born – Rigid social system based on birth

Capitalism *Western Europe In the Industrial Revolution* • Circumstances: • Features: – Governments had promoted small business during the era of mercantilism – Mechanizing inventions allowed development of factories & mass production • Impact: – Pure laissez-faire capitalism – no gov’t restrictions on business – Supply & demand pricing – Law of Competition (produces best products) – Abuse of labor. Long hours, low pay, terrible conditions, child labor. (No gov’t regulation) – Terrible living conditions (slums), environmental pollution – Ultimately standard of living rises as cost of products declines and wages increase (after gov’t involvement)

Communism *Soviet Union 1917 -1990* • Circumstance: – Social, Political & Economic conditions led to revolution – Bolsheviks institute a communist economy • Features: – Collectivized agriculture – Emphasis on heavy industry – Theoretical economic equality • Impact: – Lack of focus on consumer goods production led to low standard of living – Resistance to agricultural collectivization resulted in tremendous famine (20 million dead)

Mercantilism *Spain 1500 - 1820* • Circumstance: • Features: – Growth of commerce in Europe – Spain’s conquest of the Americas • Impact: – Amount of gold & silver in treasury defines the power of a nation – Nations seek to develop favorable balance of trade – Nations use colonies to assure favorable trade – Huge amounts of silver flood Spanish economy creating inflation (there and world-wide) – Spain closely controls colonial economies, focusing on mining and cash crop production; No colonial industry!

Mixed Economy (Socialist + Capitalist) • Circumstance: *India 1947 -1991* • Features: – Upon independence, India faced structural economic problems created by the partition of Pakistan – Needed to create industry • Impact: – Government ownership & control of major industries, transportation, communication & utilities – Private enterprise was encouraged at the local & retail level – Industry does develop, but economic growth is slow in the Nehru/Gandhi era (~3. 5% per year) – Budget deficits, inflation, food shortages – Rapid growth in 90 s & 2000 s as market economy is embraced

Communism *China 1949 -present* • Circumstance: • Features: – Anti-Nationalist sentiment led to revolution and a rise to power of the communist party • Impact: – Collectivized agriculture – 5 year plans focused on heavy industry – Introduction of capitalism under Deng Xiaoping – The Great Leap forward forced agricultural collectivization and focused on steel production. Tremendous famine – 30 million dead – Failure of the Great Leap led to the Cultural Revolution and greater disruption of China’s society – Deng’s changes have brought growth & prosperity (to some) in China