An economic system is the combination of the various institutions, agencies, consumers, entities (or even sectors as described by some authors) that comprise the economic structure of a given society or community. It also includes how these various agencies and institutions are linked to one another, how information flows between them, and the social relations within the system (including property rights and the structure of management). A related concept is the mode of production.
The economic system involves production, allocation of economic inputs, distribution of economic outputs, land availability, households (earnings and expenditure consumption of goods and services in an economy), financial institutions and government policies. It involves a set of institutions and their various social relations.
Alternatively, it is the set of principles by which problems of economics are addressed, such as the economic problem of scarcity through allocation of finite productive resources. An economic system is composed of people, institutions, rules, and relationships. For example, the convention of property, the institution of government, or the employee-employer relationship. Examples of contemporary economic systems include capitalist systems, socialist systems, and mixed economies. Today the world largely operates under a global economic system based on the capitalist mode of production.
"Economic systems" is the economics category that includes the study of such systems. It includes comparative economic systems as a subfield.
Read more about Economic System: Components, Types, Evolutionary Economics, Context in Society, List of Economic Systems
Famous quotes containing the words economic system, economic and/or system:
“Politics at all times lead to bloody wars, and not only politics, but also religions as well as social and economic systems of all times are spattered with blood. Invariably the big ones devoured the little ones, and the little ones the tiny ones.”
—Friedrich Dürrenmatt (1921–1990)
“We have heard all of our lives how, after the Civil War was over, the South went back to straighten itself out and make a living again. It was for many years a voiceless part of the government. The balance of power moved away from it—to the north and the east. The problems of the north and the east became the big problem of the country and nobody paid much attention to the economic unbalance the South had left as its only choice.”
—Lyndon Baines Johnson (1908–1973)
“How natural that the errors of the ancient should be handed down and, mixing with the principles and system which Christ taught, give to us an adulterated Christianity.”
—Olympia Brown (1835–1900)