Masaga, April B.
Sebastian, Jo Ann D.
Reyes Marvin Sergio L.
The process by which the economic and social systems of nations are connected together so that goods, services, capital and knowledge move freely between nations.
The system a society uses to provide goods and services it needs to survive and flourish.
The economic system accomplishes two basic economic task:
The task of producing goods and services, which requires determining what will be produced, how it will be produced and who will produce it.
The task of distributing these goods and services among its members which requires determining who will get what and how much each will get.
To accomplish these two tasks, economic system rely on three kinds of social devices:
Small and rely on traditional communal roles and customs to carry out the two basic economic tasks.
Individuals are motivated by the community’s expression of approval or disapproval and the community’s productive resources - such as its herds are owned in common
E.g. Bushman, the Inuit, Kalahari hunters and Bedouin tribes.
Based primarily on a government authority (a person or a group) making the economic decisions about what is to be produced, who will produce it and who will get it.
Productive resources such as land and factories are owned or controlled by government and are considered belong to the public.
E.g. China, Vietnam, North Korea, Cuba, former Soviet Union run their economies primarily on the basis of commands.
An economic system based primarily on private individuals making the main decisions about what they will produce and who will get it.
Productive resources like land and factories are