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Economics Theories

“If an elective republic is to endure for any great length of time, every elector must have sufficient information…to direct wisely the legislature, the ambassadors, and the executive of the nation… It is the duty of government to see that the means of information be diffused to every citizen.”

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Economics Theories

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  1. “If an elective republic is to endure for any great length of time, every elector must have sufficient information…to direct wisely the legislature, the ambassadors, and the executive of the nation… It is the duty of government to see that the means of information be diffused to every citizen.” -Thaddeus Stevens, Apr. 1835 What might this quote be talking about?

  2. Economics Theories The Role of Economics in Government

  3. Economics Systems Three Decisions of Economic Systems • What and how much should be produced? • How goods and services should be produced? • Who gets the goods and services that are produced?

  4. Economics Systems

  5. History of Capitalism • Capitalism developed from economic and political changes in early modern Europe • Market System • People could work for Economic Gain • Wealth should be used aggressively (?) • Free Market • Buyers and sellers were free to make unlimited economic decisions in the marketplace

  6. History Cont.. • The Wealth of Nations • Written by Adam Smith • Provided a philosophy for capitalism • Concept of Laissez-faire • “to let alone” • Gov. has hands off policy towards economy. • Market - determines price and goods produced • Gov. Influence • Mixed Market Economy – free enterprise combined and supported by government decisions in the market place. • How does the free enterprise system contribute to the idea of individual liberty?

  7. Capitalism Five Main Characteristics • Private ownership and control of property and resources • Free Enterprise • Competition among Businesses • Freedom of choice • Possibility of Profits

  8. Communism Hist. The Communist Manifesto (pamphlet) • Written by Karl Marx • Argued that population was divided • Bourgeoisie-Capitalists and owners of production • Proletariat – workers who produce the goods • Class Struggle between workers and owners

  9. Communism Beginning “In short, Communists everywhere support every revolutionary movement against the existing social and political order of things… Let the ruling class tremble at the Communist Revolution. The proletarians have nothing to lose but their chains. Working mean of all countries, Unite!” -Karl Marx, 1848 • According to Marx, How must communism come about? • Why might communism begin in this way?

  10. Goal of Communism • Full Communism • One class would evolve • Property would be communal • No need for government • Is Full Communism possible?

  11. Communist Government • Command Economy • Decisions are made at the upper levels of government. • State owns land, natural resources, industry, banks, and transportation. • State controls all mass communication • T.V., newspapers, radio etc… Issues: • Communism fails to provide adequate standards of living • Ends in Government Change or Revolt by the people. (China)

  12. Socialism Hist. • Modern Socialism • Develops in 19thcentury Industrialization causes problems • Low paid workers • Slums in cities • Democratic Socialism • Peaceful change • Gov. owns mean of production and makes most economic decisions • Free Elections • Tanzia, Denmark, Norway and Sweden

  13. Socialism Three Main Goals • Public Ownership of most land, factories, and other means of production. • Equal Distribution of wealth and economic opportunity amongst population. • Society’s control, through its gov., of all major decisions about production.

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