TraditionalCommandMarket

ECONOMIC SYSTEMS

INUIT PEOPLE

Traditional EconomyAll economic activity stems from ritual, habit, or customSocial behavior comes from habit and customIndividuals not free to make own decisionsRoles are defined by customs and elders

Examples of Traditional Economy•Indigenous Peoples•Inuit of Northern Canada•Teach children to make tools, to hunt, to fish•When hunting they share what they kill•Each head of family got a portion•Hunter got first choice, next most responsible got second choice•Hunter a hero, village fed

What were the three questions every economy must answer?

Tell your elbow partner

1.WHAT2.HOW3.FOR WHOM?

Traditional EconomyAdvantage

Everyone knows their rolesEveryone knows WHAT to produceEveryone knows HOW to produceFOR WHOM decided by tradition which dictates how to live life

DisadvantageDiscourages new ideasPunish any “out of the box” thinkersLeads to economic stagnationLower standard of living

TASK•Read about Command Economy (page 35)•Read Closely•Describe a command economy.•What are the characteristics of a command economy?•Compare the advantages and disadvantages of a command economy

TASK•Read about Market Economy (page 37)•Read Closely•Describe a market economy.•What are the characteristics of a market economy?•Compare the advantages and disadvantages of a market economy