THE CONTEMPORARY WORLD GEC-3

MIDTERMS LESSON  WELFARE IGNORED.

 EXPLOITATION OF LABOR.
LESSON 1:
“GLOBAL ECONOMIC SYSTEM”  BASIC SOCIAL NEEDS
IGNORED
 ECONOMIC SYSTEMS
All economic systems are "mixed" 2. DEMOCRATIC SOCIALISM
economies:  Major economic resources are owned
 Capitalism by government (transportation,
 Democratic Socialism communication, and utilities). Other
 Authoritarian Socialism resources are owned by individuals.
(Communism)  Individuals maintain basic human
rights.
1. CAPITALISM  Government leadership is determined
 Economic resources are owned and through elections with peaceful
controlled by individuals. transition of leadership.
 Prices are set through the interaction of
ADVANTAGES OF DEMOCRATIC
supply and demand.
SOCIALISM
 Government has a limited role in the
economy (only for the protection of  Economic equality
society).  Low unemployment
FEATURES OF A CAPITALIST  More public goods and services
ECONOMY  Universal healthcare
 Retirement pensions
 RIGHT TO PRIVATE PROPERTY.  University education
 PROFIT MOTIVE  Meets the needs of most people.
 FREEDOM OF CHOICE
 MARKET FORCES. DISADVANTAGES OF
DEMOCRATIC SOCIALISM
 MINIMAL ROLE OF
GOVERNMENT  Redistribution of incomes
ADVANTAGES OF CAPITALIST  High taxes
ECONOMY  0 Less freedom
 Lack of incentive
 Market efficiency  Lack of motivation
 Economic prosperity  Government sets prices for
 Personal freedom Freedom of government owned resources.
choice; products, careers, location,  Government decides the
and education allocation of government owned
 Private property resources.
 Competition; lower prices, better
quality and more variety 3. AUTHORITARIAN SOCIALISM
 Lower taxes  Government owns and controls
DISADVANTAGES OF CAPITALIST the economic resources and
ECONOMY answers the three economic
questions through collective
 INEQUALITIES. decision-making.
 LEADS TO MONOPOLY.
 DEPRESSIONS.
 MECHANIZATION AND
AUTOMATION.
THE CONTEMPORARY WORLD GEC-3

ADVANTAGES OF
AUTHORITARIAN SOCIALISM
 Nationalism
 Focus on a strong military
 Equality (classless society)
 State supplies many public goods
including; employment
 housing
 healthcare
 education
 Meets everyone's needs
 Job security
DISADVANTAGES OF
AUTHORITARIAN SOCIALISM
 Government transitions are
usually violent
 Government rules through
propaganda and fear.
 Redistribution of income
 Limited decision-making/choice
 Lack of motivation/incentive
 High taxes