1. Political and Economic Systems

2. Totalitarianism • A political and social system in which the central state completely controls every aspect of life (economic, family, religious, educational, cultural, etc.). • ie: Nazi Party in Germany; Communist Party in USSR • Often a dictatorship - form of government in which absolute power is concentrated in one ruler

3. Communism • Theory and system that believes that greater equality and justice will exist in a society where no private ownership of productive property (land, factories, stores) is allowed. • Communist society places ownership of "the means of production" (property) in the state or community

4. Socialism • A political and economic theory in which the production and distribution of goods are controlled by the govt. rather than by private enterprise • Cooperation rather than competition guides economic activity • Many varieties of socialism • Some socialists tolerate capitalism, as long as the government maintains the dominant influence over the economy; others insist on an elimination of private enterprise. • All communists are socialists, but not all socialists are communists.

5. Authoritarianism and Monarchy • System of government that concentrates power in the hands of one person or small group of people not responsible to the population as a whole

6. Representative Govt. (Republic) • People elect government representatives to express their welfare and to rule the country accordingly

7. Democracy • A society or government ruled by the people or by popular sovereignty.

8. Anarchy • Political philosophy that all state authority or power is oppressive and unjust • Believes that governmental authority imposes unfair rules on people, steals their money, and keeps them in slavery

9. 3 Basic Economic Questions • What to produce? • How to produce? • For whom to produce?

10. Capitalism • economic system characterized by private ownership of property, wage labor, investment, competition, and free markets

11. Market Economy • an economy in which most goods and services are produced and distributed through free markets, free from the control or regulation of the state (laissez faire)

12. Command Economy • an economic system in which activity is controlled by a central authority and the means of production are publicly owned

13. Mixed Economy • Mix of traditional market and command economies • Mix of govt. owned/regulated businesses and private businesses

14. What works best? How does each system answer our 3 economic questions? What would make people want a command economy? What would make people want a capitalist free market economy?