Chapter 13: The Economy and Politics

The economy is what shows neighboring countries what kind of country it is. Economy is what shows people how developed and how powerful a nation is. Politics are what all countries have in order to keep peace and to have authority over the people. Politics are anything that has to do with the government that contain power.

To satisfy people's needs and wants, every society develops a system of roles and norms that governs the production, distribution, and consumption of goods and services. This is called the economic institution. The factors of production are resources needed to produce goods and services which include the land, labor, capital, and entrepreneurship. The primary sector deals wsecondary sector concentrates on the use of raw materials to manufacture goods. The tertiary sector shifts to providing services. In Preindustrial societies, there is very little technological development. In Industrial societies, the main emphasis in the economy shifts from the primary sector to secondary. Postindustrial societies, the tertiary sector is the most important. In capitalism the factors of production are owned by the individuals rather than by the government. Law of supply states that producers will supply more products when they can charge higher prices and fewer products when they must charge lower prices. Law of demand states that consumers will demand more of a product as the price of the product decreases. If government interference is kept to a minimum and if competition is restricted, the invisible hand of market forces will keep the economy in balance, sometimes known as laissez-faire capitalism. The commitment to limited government control of business operations has resulted in the labeling of capitalist economies as free-enterprise systems. In socialism, the factors of production are owned by the government, which regulates economic activity. Communism is a political and economic system in which property is communally owned. Totalitarianism: those in power exercise complete authority over the lives of individual citizens. Both have changed over time; capitalism has changed for the USA is capitalist but it uses programs that are socialist in nature and socialism collapsed. Corporation is a business organization that is owned by stockholders and is treated by law as if it were an individual person. Oligopoly is the market situation in which a few large companies control an industry. Protectionism is the use of trade barriers to protect domestic manufacturers from foreign competition. Free-trade is trade that is not restricted by trade barriers between countries. Multinational is any corporation that has factories and offices in several countries. The nature of work has shifted from an industrial base to a service base. E-commerce is business conducted over the internet. Recently in the USA the economy has gone down considerably, the national debt is worse than it has ever been in the past and this is because of the current president. $16,805,913,562,515.19 is the debt now in the USA.

ith the extraction of raw materials from the environment. The

Power is the ability to control the behavior of others with or without their consent. State is the primarily political authority in society. Political Institution is the system of roles and norms that govern the distribution and exercise the power of society. Functionalist view is to analyze political institutions in terms of functions of the state, creation of laws, settling conflicts with individuals and relations with other countries. Conflict theorist view is how the political institution brings social change. Different groups in society compete for power. Legitimacy is whether those in power have the right to govern others. Max Weber referred to legitimate power as authority. Coercion is power that is considered illegitimate by the people governed. Traditional authority is power based on a long standing custom. Rational legal authorities are rules and regulations that outline the rights and obligations of those in power. Charismatic authority is based on the personal characteristics of the individual in power. Political Parties are organizations that seek to gain power through legitimate means. Proportional representation ensures that minority parties receive a voice in the government. Interest Group is an organization that attempts to influence the political decision making process. Voter participation is the heart of the democratic process. Voter Participation varies among different groups of Americans. Race, education, employment and age are factors that affect voting. The Power-elite model was first presented by C. Wright Mills and states that political power is exercised by and for the privileged few in society. The Pluralist model states that the political process is controlled by interest groups that compete one another for power.

As we can see economy is a huge factor for societies. If the economy is down, this shows that the country is not well, if it is high the country appears high. Politics can range from well behaved people to lesser behaved people. Some politics are good and others are bad. But a society needs politics in order to thrive.