Economic Levels
– People earn a living by providing raw materials or natural resources to others.
– Examples include agricultural industries such as farming, fishing, and mining.
Primary Industry
A __________ economy is a system in which people grow their own food and make their own goods.
Traditional Economy
Where did the Industrial Revolution Begin
England
underground economy, shadow economy
Activities not reported by government, not taxed 🡺 difficult to measure
Sometimes illegal, often in LDCs - e.g. drug trade in Mexico
No legal protection for workers, no social benefits, prone to exploitation
Informal Economy
Falls in between capitalist and communist models
Government controls some industries and services such as healthcare, electricity and communications.
Sweden and India are examples.
Socialist Economies
– Manufacturing industries that use natural resources or raw materials to make other products
– Example: automobile manufacturers use steel and other materials to build cars and trucks.
Secondary Industry
A ___________ economy is a system in which the central government makes all economic decisions.
command
people not needed on farms, but in factories
Rapid urbanization without sufficient growth of infrastructure
Rural to Urban Migration
Regulated, monitored and taxed by government 🡺 easy to measure
Formal Economy
When a company or business gives a way or sends away a part of the operation,services of a business to an outside business, company or contractor.
Outsourcing
– Involves the research and distribution of information
– Examples include librarians, computer programmers, and scientists
Quaternary Industry
A ________ economy is a system based on private ownership, free trade, and competition.
Market
This is a Description of a Industry
Little
Human labor (one family)
Very little – at home
Slow speed, low efficiency
Only for local market
Cottage Industry
“value of final goods + services produced in a country in one year”
shows amount of production & consumption, not much about quality of life
Gross Domestic Product (GDP)
Moving a portion(s) of a business to another country, usually for cheaper pay and other factors that may result in saving money for the business.
Example Ford Motor Company building its factories for building its cars to El Salvador.
Offshoring:
– Goods and services are exchanged
– Includes wholesale industries, businesses that sell to other businesses
– Includes retail industries where goods are sold to final consumers
– Include service industries where businesses provide services rather than goods
Tertiary Industry
Closest to a command model
Government owns factors of production
North Korea is an example.
Government makes all economic decisions.
Communist Economies
This is a Description of a Industry
A lot
Machines (operated by people)
A lot – in factories
Fast speed, high efficiency
For local and global market
Industrial Revolution
“small loans provided by individuals or NGOs to people in developing states
who are working to start a small business to benefit the community”
Microloans / Microfinance
Very Poor and not developed is known as what kind of country.
Periphery
are things that people do, such as a school nurse helping a student who is hurt
Services
Closest to a market economy
Individuals and businesses own factors of production and make economic decisions.
United States, Canada, and Taiwan are examples.
Government enforces health and safety standards.
Government spends money from taxes to support economic development.
Capitalist
_____ and _____ as key resources available to power engines, factories, trains
Coal and Iron
“compares what similar goods cost in various
countries” (i.e. value of money in a country)
Purchasing Power Parity (PPP)
Very Developed Country has all essentials to live and is a strong country, is known as what kind of a country.
Core