Political & Economic Systems

1. Political & Economic Systems Chapter 4, Section 3

2. Features of Gov’t • Today the world is made up of nearly 200 independent countries • Each country is defined by characteristics such as its territory, its population, and its sovereignty, or freedom from outside control

3. Levels of Gov’t • Unitary System- gov’t gives all key powers to the national or central gov’t. • Federal System- gov’t divides the powers of gov’t between the national gov’t and state gov’ts

4. Types of Governments • Gov’ts can be classified by asking the question: “Who governs?” • Under this classification system, all gov’ts belong to one of the three major groups

5. Autocracy • Any system of gov’t in which the power and authority to rule belong to a single individual is an autocracy. • Autocracies are the oldest and one of the most common forms of gov’t • Examples: Hitler’s gov’t in Germany

6. Oligarchy • An oligarchy is any system of gov’t in which a small group holds power • Example- Communists countries such as China are most oligarchies

7. Democracy • Democracy is any system of gov’t in which leaders rule with the consent of the citizens • Direct democracy, in which citizens themselves decide on issues, exists in some places at local levels of gov’t, but no countries today have a national gov’t based on direct democracy

8. Democracy Continued • Democratic countries have representational democracies in which the people elect representatives with the responsibility and power to make laws and conduct gov’t

9. Economic Systems • All economic systems must make three basic economic decisions: 1. What and how many goods and services should be produced? 2. How they should be produced? 3. Who gets the goods and services that are produced?

10. Traditional Economy • Habit and custom determine the rules for all economic activity • Individuals are not free to make decisions based on what they would like to have

11. Market Economy • In a Market Economy, individuals and private groups make decisions about what to produce • People as shoppers decide what they will and will not buy • Market economy is based on free enterprise, the idea that private individuals or groups have the right town property or businesses and make a profit with only limited gov’t interference.

12. Command Economy • In a Command Economy, the gov’t owns or directs the means of production—land, labor, capital (machinery, factories) and business managers, and controls the distribution of goods • Countries with command economies try to distribute goods and services equally among all citizens

13. Resources, Trade, and the Environment Chapter 4, Section 4

14. Resources • Earth provides all the elements necessary to sustain life. • The elements form the earth that are not made by people, but can be used by them for food, fuel, or other necessities are called natural resources

15. Renewable resources- cannot be used up or can be replaced naturally or grown again in a relatively short amount of time • Examples: wind, sun, animal life • Nonrenewable resources- resources that cannot be replaced • Examples: minerals and fossil fuels

16. Economic Development • Most natural resources are not evenly distributed throughout the earth. This uneven distribution affects the global economy. As a result, countries specialize in the economic activities best suited to their resources

17. Those having much technology and manufacturing are called developed countries. (United States) • Those countries working toward greater manufacturing and technology use are called developing countries (many countries in Africa and Latin America) • Industrialization, or the spread of industry, has transformed once largely agricultural countries (China & Malaysia)

18. World Trade The unequal distribution of natural resources promotes a complex network of trade among countries

19. Barriers to Trade • Tariffs- a tax added to the price of goods • Strict Quota- number limit on the quantity of a particular product that can be imported from a particular country • Embargo- banning trade with another country although as a way to punish that country for political or economic differences

20. Free Trade In recent years, governments around the world have moved toward free trade, the removal of trade barriers so that goods can flow freely among countries

21. People and the Environment A major environmental challenge today is pollution, the release of unclean or impure elements into the air, water, & land

22. Water and land pollution • Air pollution • Fragile ecosystem