UNIT 2 LEARNING GOAL 2Economic Systems

How the distribution of goods and services is determined in free enterprise, socialist, and communist economic systems and classify where various countries fall along the economic spectrum.

(do not write)

U2LG2

Learning Goal:Outline the distribution, characteristics,

and interactions of the economic systems in the world.

Criteria For Success:• (A)  Students determine the forces which

distribute goods and services in the free enterprise, socialist, and communist economic systems

• (B) Students outline specific countries of where they fall along the economic spectrum between free enterprise and communism

Question: What is the difference between Gross Domestic Product (GDP) and Gross National Product (GNP)? 

- GDP is the market value of everything produced within a country

- GNP is the value of what’s produced by a country’s residents, no matter where they live.

In your ISN: Write the question

and the responses then tell…

What do these answers mean to you?

Can you list or draw examples?

Pair with another to share your thoughts / illustrations.

ANSWER:

Free Enterprise Economies

Business governed by the laws of supply and demand, not restrained by government interference, regulation or 

subsidy.  Also called free

market and capitalism.

The Bad: Free markets don’t create utopia. Businesses can fail and workers be displaced.

The Good:

The Ugly: Capitalism is prone to corruption. People get greedy, and they cheat, and they exploit the weaker elements of society.

Socialist Economies

• An economic system in which goods and services are provided through a central system of cooperative and/or government ownership rather than

through competition and a free market system. Tax rates extremely high but, services (healthcare, education, child care, housing subsidies)

The Good: Everyone Shares (just like mom and dad told you to do with your brothers and sisters

The Bad: See above

The Ugly: See above

Command Economy

• Economic and social system in which all (or nearly all) property and resources are collectively owned by a classless society and not by individual citizens

• Communist Countries, Past and Present• Current Communist Countries: China, Cuba, 

Laos, North Korea, and Vietnam.• Formerly Communist countries (by current

name):• Formerly part of the Soviet Union: Armenia, 

Azerbaijan, Belarus, Estonia, Georgia, Kazakhstan, Kyrgyzstan, Latvia, Lithuania, Moldova, Russia, Tajikistan, Turkmenistan, Ukraine, and Uzbekistan.

• Other Asian countries: Afghanistan, Cambodia, Mongolia, and Yemen.

• Soviet-controlled Eastern bloc countries: Bulgaria, Czech Republic, Germany (East), Hungary, Poland, Romania, Slovakia.

• The Balkans: Albania, Bosnia and Herzegovina, Bulgaria, Croatia, Rep. of Macedonia, Montenegro, Serbia, and Slovenia.

• Africa: Angola, Benin, Dem Rep. of Congo, Ethiopia, Somalia, Eritrea, and Mozambique.

(according to the Young Communist League)The Good: Everyone is guaranteed a job.The Bad: no one has the right to become wealthy.The Ugly: Generally No Taxes = no money for roads, schools, etc.

Communism Map of the Past

Look at the following countries and HK, Which would YOU consider one that has a Free Enterprise Economic System? A Socialist Economic System? A Communist Economic System?One-By-One, Which Economic System Do You & Your Classmates Believe Each Country Falls Under? France

Hong Kong, China

Japan

Laos

Vietnam

Germany

Ireland

Australia

Denmark

Free Enterprise(capitalism)

Socialism Command

4:34 minutes of the World’s Largest Economies 2001 to Present to 2018 http://www.youtube.com/watch?

v=p3UzJtA4yRw