The Economy and Work
How does change in the economy reshape society?
What makes capitalist and socialist economies different?
Why have the types of jobs available in the United States changed over the last fifty years? Here’s a quick quiz about the U.S. economy (Hint: All five questions have the same right answer): •Which business do 100 million people in the United States visit each week? •Which U.S. company, on average, opens a new store every day? •Which U.S. company is the largest employer in the country after the federal government? •Which U.S. company will create nearly 800,000 new jobs over the next five years? •Which single company accounted for 25 percent of all the growth in U.S. economic output during the second half of the 1990s? You have probably guessed that the correct answer is Wal-Mart, the global discount store chain founded by Sam Walton, who opened his first store in Arkansas in 1962. By 2005, Wal-Mart had $285 billion in sales from 3,600 stores in the United States and 1,500 stores in other countries, from Brazil to China. Wal-Mart has made a lot of shoppers happy, but not everyone is pleased about the company’s rapid expansion across the United States. Opponents have formed a social movement to keep Wal-Mart out of their local communities, fearing the loss of local businesses and, in some cases, local culture. Critics also claim that the merchandising giant pays low wages, keeps out unions, and sells many products made in sweatshops abroad (Rousseau, 2002; Saporito, 2003). This chapter examines the economy, widely considered the most influential of all social institutions. (The other major social institutions are examined in the chapters that follow.) As the story of Wal-Mart’s expansion suggests, the economy of the United States and the entire world is dominated by a number of giant corporations. Who benefits from these megabusinesses? Who loses? What is it like to work for one of these corporations? To answer these questions, sociologists study how the economy operates as well as the nature of work and what it means to each of us. The Economy: Historical Overview
The economy is the social institution that organizes a society’s production, distribution, and consumption of goods and services. As an institution, the economy operates in a generally predictable manner. Goods are commodities ranging from necessities (food, clothing, shelter) to luxury items (cars, swimming pools, yachts). Services are activities that benefit others (for example, the work of priests, physicians, teachers, and software specialists). We value goods and services because they ensure survival or because they make life easier or more interesting. Also, what people produce as workers and what they buy as consumers are important parts of social identity, as when we say, “He’s a steelworker,” or “She drives a Mercedes.” How goods and services are distributed, too, shapes the lives of everyone by giving more resources to some and fewer to others. The economies of modern high-income nations are the result of centuries of social change. We turn now to three technological revolutions that reorganized production and, in the process, transformed social life. The Agricultural Revolution
MEMBERS OF THE EARLIEST HUMAN SOCIETIES WERE HUNTERS AND GATHERERS LIVING OFF THE LAND. IN THESE TECHNOLOGICALLY SIMPLE SOCIETIES, THERE WAS NO DISTINCT ECONOMY. RATHER, PRODUCING AND CONSUMING WERE ALL PART OF FAMILY LIFE. As Chapter 4 (“Society”) explained, when people harnessed animals to plows, beginning some 5,000 years ago, a new agricultural economy was created that was fifty times more productive than hunting and gathering. The resulting surplus meant that not everyone had to produce food, so many took on specialized work: making tools, raising animals, or building dwellings. Soon towns sprang up, linked by networks of traders dealing in food, animals, and other goods. These four factors—agricultural...