Economic Concepts and Issues

• These flashcards define key economic concepts and issues.

Economic Concepts

• Economic Growth: GDP increase over time via increased production.
• Colonialism: A country seeks its own benefit by subjugating another, including imposing cultural, economic, or religious practices.
• Mercantile System: A country increases wealth by maintaining a positive trade balance, maximizing exports and minimizing imports.
• Neo-Colonialism: Control of another country through economic, trade, and cultural influence.
• Trans-National Corporations: Companies operating globally without being tied to a single country.
• Concession Companies: Companies created by colonizing countries to trade in specific regions or products, often governing the trade area.
• Command Economy: The government determines prices and quantities of goods and services.
• Mixed Economy: Combines free enterprise and government intervention.
• Economic Liberalism: The belief that economies should operate without government intervention, proposed by Adam Smith in 1776.
• Keynesian Economics: Government should increase spending during economic slowdowns to stimulate the economy.
• Progressive Thought: Belief that unregulated capitalism is harmful and the government should regulate the economy to promote social justice.
• Neo-Liberalism: A modern term describing Adam Smith's ideas, such as a free market economy and a reduced role for government.
• Economic Globalization: A worldwide economic system with easy movement of capital, goods, labor, production, and resources as trade barriers are removed.
• Tariffs: Taxes on imports or exports.
• Non-Tariff Barriers: Regulations protecting domestic businesses from international competition, like quotas or bans, aside from tariffs.
• Populism: A political movement linked to citizens' aspirations, viewed as a struggle between "the people" and "others."
• Traditional Economy: An economic system based on agriculture, fishing, hunting, and gathering
• Market Economy: An economic system where prices are determined by supply and demand
• Command Economy: An economic system where the supply of goods and services is determined by the government

Sustainability and Welfare Indicators

• Living Planet Index: Measures global biodiversity in terrestrial, freshwater, and marine ecosystems, created by the World Wildlife Fund.
• Ecological Footprint (EF): Measures the environmental impact of a lifestyle, expressed as the land needed to sustain it.
• Index of Sustainable Economic Welfare (ISEW): Measures beneficial vs. unsustainable activities, like adding child-care costs and subtracting pollution costs.
• Genuine Progress Indicator (GPI): Measures a country's well-being using economic, environmental, and social indicators.

Stages of Economic Development

• Traditional Society: Stage 1, based on subsistence agriculture, often with dictatorships or monarchies.
• Establishing conditions for take off: Stage 2, where society gains wealth and becomes more centralized.
• Economic Takeoff: Stage 3, new technology is introduced, and the tertiary sector expands in cities.
• Drive to maturity: Stage 4, economic growth outpaces population growth, with technological improvements in primary and secondary sectors.
• High mass consumption: Stage 5, people have enough money and demand more goods and services.

Colonialism definitions

• A practice where one country rules another and develops trade for its own benefit, restricting colonies to trade only with the mother country.
• A modern form of colonialism that exerts economic power over another country without taking over land
• Cultural heritage, such as languages, persisting because of colonial powers creating new boundaries

Balancing Economic Growth and Environmental Sustainability

• Requires including environmental concerns into financial decisions and implementing policies promoting sustainability and innovation.
• Involves measuring environmental impacts and promoting sustainable development to provide long-term benefits without harming the environment.