GEOGRAPHY SHORT BRIEF NOTE
What are the specific examples of countries with a command economic system? What are the
specific examples of countries with a command economic system? What are the specific
examples of countries with a command economic system? What are the specific examples of
countries with a command economic system? Characteristics of traditional economic system
lack of knowledge of science and technology
low productivity
low level of exchange of goods
2. market economy
it is an economic system in which individuals make the main economic activity and transaction
decisions.
the basic economy questions are answered by the interplay of buyers and sellers.
the guiding principle of the market system is self-interest. Sailors wanted to sell at a higher price
and the buyers want to buy the lowest price
characteristics of the market economic system
private property
economic freedom
prices are determined by the law of demand and supply.
decentralized decision-making.
3. Command economy
in a command economy the government makes the government decision about production and
consumption
the government decides what to produce, how to produce and for whom to produce
all factories, and land housing is owned by the government.
command economic system is now fading away in the world but some countries use common
economic systems like North Korea, Cuba, and China
it is characterized by
A master plan for supply and price
the government develops and enforces plans
goods and services are distributed through government agencies
4. Mixed economy
Both government and private sectors play an important role in answering the what, how, and for
whom questions concerning society as a whole
There is competition between the government and the private sections sometimes those that
are unable to complete soon die away.
4.2 Sustainable economic development
concept and indicators of economic development
development is a difficult concept to define
a possible definition of development includes a wide range of elements
population global player
urban issues rural issues
growth poverty the environment of development
environment
development is a process by which members of society increase their personal and institutional capacity
to mobilize and manage resources to produce sustainable improvement in their quality of life
development in any society must have at least three objectives
o to increase the availability and widen the distribution of basic life-sustaining goods such as food
shelter health services and closing.
o to raise living standards and levels of income employment education and attention to cultural
and human values.
o to expand the range of economic and social choices.
economic development strategy should give due attention to increasing the productive capacity
of human will and the health of the environment this is done by concentrating on
making sure that the nation has a labor force that's ready to work
improving the skill and ability to workforce
ensuring the human labor force has adequate medical care
improving the supply multiplication and distribution of modern and environmentally friendly
technology and other inputs
Sustainable development is easy development that meets the needs of the present without
compromising the ability of future generalizations to meet their own needs
Components of sustainable development
society meeting the needs of the majority of people
Economy eradicating poverty by increasing living standards.
Environment protecting the environment by harmonizing socio-economic development.
The area of overlap or intersection between these three represents human well-being
As the environment society and economy become more aligned the area of overlap increases
and so does human well-being.
indicators of economic development
Indicators of development are measures of a certain level of development in a given country
The main indicators of development in the world include
1. The GDP or gross domestic product
GDP is the total value of currency produced for final goods and services within a country's
borders in a year
2. Per capita income
per capita, income is a measure used to evaluate the standard of living it is related to the GDP
per capita income= GDP+(income secured from abroad-income taken away by foreigners)
. total population
or per capita income= GNP/total population
3. standard of living
o living standard is perhaps the best measure of the quality of life in a given society
o it is directly related to both GDP and per capita income this is because at the later gate
higher the former improves and vice versa.
Developed countries have high end constantly growing living standards
Developing countries have low living standards
based on the indicators of development the countries of the world can be classified as
- rich or poor - first world/third world
- developed or developing - more developed or less developed
- North or South
using the current development status as criterion countries can be grouped as
- developed/less developed/least developed
the world's top ten developed countries (according to 2009 data)
USA Germany Italy
Japan Canada
France UK
Norway Switzerland
the words least developed countries [according to 2009 data]
Afghanistan Burkina Faso Central African Republic
Bangladesh Guinea Bissau Chad
Benin Burundi Guinea
4.3 economic organizations of the World
three key institutions serve the U.S. economic organization of the world are
1. World Bank
it is the specialized agency of the united nations
it was established in 1944
it grants loans to member nations for reconstruction and development
its headquarter is in Washington DC
it makes large loans to governments in developing countries to finance projects example
road construction, dams, power generation, and industries
officially, it is called the international bank for Reconstruction and Development [IBRD]
2. International Monetary Fund[IMF]
established in 1944
IMF is aimed at
encouraging exchange stability
eliminating exchange controls
promoting International Monetary cooperation
expanding World Trade
- it makes loans so that the countries can maintain the values of their currencies and repay
foreign debt
- initially it focused on Europe but in the 1970s it changed its focus to LCDs
- both IMF and the World Bank impose certain conditions for loans and require what are
called structural adjustment programs from borrowers the programs are based on a strategy
that promotes free markets including
Privatization
Deregulation
Trade liberalization
3. World Trade Organization
it was established in 1994 to replace the general agreement on Tariffs and Trade [GATT],
which was established in 1947
it promotes and enforces provisions of the trade laws and regulation
it has the authority to administer and put in place new and existing free trade
agreements to oversee World Trade practices, and to settle trade disputes among
member countries
it has both proponents and opponents
Globalization
- it is a process by which people, their ideas, and their activities[economic, cultural, political]
in previously relatively separated parts of the world become interconnected and are drawn
to the same social space at the same historical time
Advantage of globalization
It creates new opportunities and benefits
the rise in free trade
rapid information flow
improved quality of goods and services
it helps to increase foreign direct investment
promote economic growth and lift the poor from poverty
increase in remittances in developing countries sent by migrants from abroad
Disadvantage of globalization
I'm able to avoid the divergent interest clash between the rich Western industrialized countries
in the poor developing countries
the strong end wheezy nations have the power to promote certain of their advantages
local markets in developing countries may be dominated by the goods imported from developed
countries
the widening gap between the rich and the poor
environmental degradation
small scale industries face extinction
the rapid spread of deadly diseases
