Chapter 11 Flashcards
Capitalism
Economic system in which resources and producing goods and services are privately owned
Adam Smith
Economist believed people are guided by their self interest economy produces the greatest good for the greatest number of people
Free market environment
Producers compete with each other to sell goods and services consumers compete to buy
Government
Formal organization that directs political life of society
Problems with capitalism
Companies replace workers with machines that are more cheap generates a high level of economic inequality
Socialism
Economic system in which natural resources and means of producing goods and services are collectively owned Collective desire to serve the common good and not ourselves
Socialist model Karl Marx
Capitalisms private ownership of productive property creates unequal social classes Replace private goals with social goals big government
Problems with socialist model
A low standard of living highly regimented government Limiting individual freedoms to speak and move freely
State capitalism
Government working closely with large and privately owned
Welfare capitalism
Government provides extensive welfare programs funded by high taxes
Political left, middle, political right
The more left free market is a problem
The more right free market is the solution
Mixed System is known as a state capitalism
Involves government working closely with large privately owned companies
Political economy
The closely linked economic and political life of a nation or world region
Peter Berger Political sociologist
Examined the political consequences of capitalism limited government of a capitalist society provide people with the right to vote but extends freedom
Socialism political views Karl Marx
Capitalism actually reduces personal security at least for most people
Democracy
Powers exercised by the people as a whole
Authoritarianism
The opposite of democracy a system that denies popular participation in government power Iran is an example
Monarchy
Another example of authoritarian nation system in which of single family rules from generation to generation
Corporations
Business that is separate And distinct from its owners think of an island. Business with legal entity with legal existence Including rights and liabilities separate from that of their members
How does the government partner with companies corporations
Corporations are governments biggest customers corporations expect favors from government because they attract business and jobs
Monopoly
Domination of an entire market by a single company
Oligopoly
Domination of a market by a few companies
Difference between monopoly and oligopoly
Monopoly is domination by a single company oligopoly is domination by more than one company