SS7 Unit4 Economies

Types of Economies & Economy in Europe

What is an Economy?

The Economy deals with
-Production of Goods (making things)
-Distribution of Goods (selling things)
-Consumption of Goods (buying things)

Match

Match the following

• Production of Goods

• Distribution of Goods

• Consumption of Goods

Making things

Selling things

Buying things

• Making things

• Selling things

• Buying things

Economic System

An Economic System is a system of producing and exchanging goods and services (especially natural resources)

Four Types of Economy

Traditional Economy

Description: based on community and their traditions; take care of themselves and are self-sufficient

Example: Native American communities before European colonization

Positives: everyone knows their role and work together

Negatives: Not much growth, no technology and changes are slow

Multiple Choice

What type of economy is based off the community and culture?

• traditional

• mixed

• market

• command

Market Economy

Description: People make all economic decisions and the government has NO authority

Example: 19th century British and American Industrialism; VERY rare

Positives: Competition between businesses bring prices down. People can buy whatever they want, lots of variety

Negatives: Poverty increases and workers' rights decrease with minimal government protection

Multiple Choice

In this economy, the people make all economic decisions and the government has NO say.

• traditional

• market

• mixed

• command

Command Economy

Description: Government has total control of economy.

Examples: North Korea, Soviet Union (communist Russia)

Positives: Stable economy, more equality and less poverty, more protection for workers

Negatives: Little to no freedom or choice, no variety, more likely to have government corruption

Multiple Choice

Government has all control in a ____________ economy

• traditional

• mixed

• market

• command

Mixed Economy

Description: a MIX between command and market, where people have economic power, but government passes laws to protect workers and help stabilize the economy

Example: USA

Positives: Best of both worlds; freedom for people and government protects workers

Negatives: conflict arises among people about government control

Multiple Choice

This economy is the best of both worlds, where people have a say but the government also has some control/say

• traditional

• mixed

• market

• command

EUROPEAN ECONOMIES

Europe's Economies

All of Europe's economies are mixed
-individuals own most businesses
-governments control education, healthcare, and transportation

Human Capital
-investment in employees' skills and education
-many countries have free training and courses
-high levels of small businesses due to entrepreneurship

Germany's Economy

-Focused on industry (rich minerals and transportation)
- Europe's largest economy
-strong auto industry
-research and engineering
-strong entrepreneurship

Government role
-mixed economy (government provides healthcare and education)
-high literacy rates and levels of production

Britain's Economy

First to industrialize and develop a steel industry
-later turned to research and financial services

Human capital
-Heavy investment (high literacy rates and standard of living)
-strongest entrepreneurship in Europe

Government involvement
-mixed economy
-government does NOT control railroads or higher education

Russia's Economy

Main exports- oil and gas (government-owned)
Strong Steel industry because of mineral resources

Economic factors
-changing to a mixed economy after communism (difficult and slow process)
-outdated technology- limited production in factories
-relies on imports for consumer goods
-higher investment in education than in Central Asia
-Entrepreneurship is low (government regulations and corruption)

Match

Match the country with their economy

• Europe's largest economy

• Strongest entrepreneurship

• Main exports are oil and gas

Germany

Britain

Russia

• Germany

• Britain

• Russia

​Vocabulary to REMEMBER!

Sanctions- restrictions on trade, travel, and assets of a country

Infrastructure- physical structures needed to make a country run

Recession- slowdown in the economy

Human Capital- knowledge and skills a person has that can be used to earn money

Match

Match the following words to the definition

• Sanctions

• Recession

• Human Capital

• Infrastructure

restrictions on trade, travel, and asset

slowdown in the economy

knowledge and skills a person has

physical structures of a country

• restrictions on trade, travel, and asset

• slowdown in the economy

• knowledge and skills a person has

• physical structures of a country