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Types of economic systems

Types of economic systems . entities. Players: Goal Consumers: maximize personal utility Businesses: maximize long-run profit Government: maximize social welfare. Government Questions: 1. How much should the economy produce? It depends on the resources it has available. US Farm land.

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Types of economic systems

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  1. Types of economic systems

  2. entities • Players: Goal • Consumers: maximize personal utility • Businesses: maximize long-run profit • Government: maximize social welfare

  3. Government Questions: 1 • How much should the economy produce? • It depends on the resources it has available

  4. US Farm land • 1997, 2002 and 2007 Census of Agriculture 199720022007 • Approximate total land area (acres  ) 2,262,462,020 2,263,960,501 2,260,994,361    • Total farmland (acres) 954,752,502 938,279,056 922,095,840         •  Percent of total land area 42.2 41.4 40.8            • Cropland (acres) 445,324,765 434,164,946 406,424,909              • Percent of total farmland 46.6 46.3 44.1              • Percent irrigated 11.5 11.6 12.7               • On the arable land, which is only 11% of Japan's total land area, the population density is among the highest in the world. • 145,833 sq mi in Japan – 15,000 square miles of farmable land • 9,600,000 square acres • • Census of Agriculture• Contact NASS Customer Service, 1-800-727-9540.

  5. What should be produced? • Country Agri.  Indus. Serv.   • United States 0.9% 20.4% 78.6% • South Korea 3.3% 40.7% 56% • Indonesia 13.1% 46% 41%

  6. How are the goods and services produced? • By the most efficient companies. • Sometimes by the government.

  7. Who receives the output?Income Distribution by Quintile • 2006 BOT 20 MID 20 TOP 20 TOP 5 • 116,011 3.4 8.6 14.5 22.9 50.5 22.3 • 2005 • 114,384 3.4 8.6 14.6 23 50.4 22.2 • 2000 • 108,209 3.6 8.9 14.8 23 49.8 22.1 • 1990 • 94,312 3.8 9.6 15.9 24 46.6 18.5 • 1970 • 64,778 4.1 10.8 17.4 24.5 43.3 16.6

  8. Can the system adapt to change?

  9. These were so cool!

  10. State of the Art

  11. Types of Economies • Command – governments determines prices and quantities produced • Capitalistic - free market interaction between buyers and sells determines prices and quantities produced • Mixed – a mix where in some markets the government is a buyer, regulator, or producer. • Even with a free market capitalist system there are times when the system does not operate in a manner that best suits the overall population. These occurrences are known as free market breakdowns. Some of these free market breakdowns are on the “Free Market Breakdown” page on the website.

  12. How can the type of economic system be determined? Government percent of overall spending. http://anepigone.blogspot.com/2008/03/government-spending-as-percentage-of.html http://www.usgovernmentspending.com/ http://www.heritage.org/index/Ranking.aspx

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