![]() Until shortly after World War I, most workers were immigrants from Europe, their immediate descendants, or African-Americans whose ancestors were brought to the Americas as slaves. Throughout its history, the United States has experienced steady growth in the labor force, and that, in turn, has helped fuel almost constant economic expansion. The number of available workers and, more importantly, their productivity help determine the health of an economy. The second ingredient is labor, which converts natural resources into goods. These extensive waterways have helped shape the country's economic growth over the years and helped bind America's 50 individual states together in a single economic unit. border with Canada - provide additional shipping access. Rivers flow from far within the continent, and the Great Lakes - five large, inland lakes along the U.S. It also has extensive coastlines on both the Atlantic and Pacific Oceans, as well as on the Gulf of Mexico. The United States is rich in mineral resources and fertile farm soil, and it is blessed with a moderate climate. The first ingredient of a nation's economic system is its natural resources. As a result, the American economy is perhaps better described as a "mixed" economy, with government playing an important role along with private enterprise.Īlthough Americans often disagree about exactly where to draw the line between their beliefs in both free enterprise and government management, the mixed economy they have developed has been remarkably successful. If the pure capitalism described by Marx ever existed, it has long since disappeared, as governments in the United States and many other countries have intervened in their economies to limit concentrations of power and address many of the social problems associated with unchecked private commercial interests. While those categories, though oversimplified, have elements of truth to them, they are far less relevant today. Marx and his followers believed that capitalist economies concentrate power in the hands of wealthy business people, who aim mainly to maximize profits socialist economies, on the other hand, would be more likely to feature greater control by government, which tends to put political aims - a more equal distribution of society's resources, for instance - ahead of profits. Marx contrasted capitalist economies to "socialist" ones, which vest more power in the political system. ![]() ![]() The United States is often described as a "capitalist" economy, a term coined by 19th-century German economist and social theorist Karl Marx to describe a system in which a small group of people who control large amounts of money, or capital, make the most important economic decisions. But the way these different elements are organized and used also reflects a nation's political ideals and its culture. In every economic system, entrepreneurs and managers bring together natural resources, labor, and technology to produce and distribute goods and services. The Role of the Government in the Economyįoreign Trade and Global Economic Policies
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