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The Economy:
Historical Overview
The economy – the social institution that
organizes a social production, distribution,
and consumption of goods and services.
 Members of the earliest human societies
were hunters and gatherers living off the land.
 When people harnessed animals to plow, the
economy was 50 times more productive.

The Economy:
Historical Overview
The Agricultural Revolution – the
resulting surplus meant that not
everyone had to produce food.
 Many took on specialized work.
 Soon towns sprang up, making the
economy a distinct social institution.

The Economy:
Historical Overview

The Industrial
Revolution – The
development of
industry changed
the economy.
 This raised the
standard of living.
 The benefits were
not shared equally.


The Information
Revolution –
automated machinery
reduced the role of
human labor.
The computer has
blurred the line between
home and work life.
Sectors of the Economy
The primary sector – the part of the
economy that draws raw materials from the
natural environment.
 The secondary sector – the part of the
economy that transforms raw materials into
manufactured goods.
 The tertiary sector – the part of the economy
that involves services rather than goods.

Economic Systems:
Paths to Justice

Capitalism – an
economic system in
which natural
resources and the
means of producing
goods and services
are privately owned.

Socialism – an
economic system in
which natural
resources and the
means of producing
goods and services
are collectively
owned.
Economic Systems:
Paths to Justice

Welfare capitalism – an
economic and political system
that combines a mostly marketbased economy with extensive
social welfare programs.
Work in the Postindustrial
Economy
Regions of the country with greater
labor force participation are more
affluent.
 Farming has rapidly declined, shrinking
the primary sector.
 A majority of workers have moved into
service occupations, creating a vast
middle-class.

Figure 12-2 (p.
308)
The Changing
Pattern of Work in
the United States,
1900-2001
The Dual Labor Market

The primary labor
market – jobs that
provide extensive
benefits to workers.
 Includes white-collar
as well as upper
management
positions.

The secondary
labor market – jobs
that provide minimal
benefits to workers.
 Includes those
employed in lowskilled, low-level
sector jobs.
Corporations
Corporation – an organization with a legal
existence, including rights and liabilities, apart
from that of its members.
 Incorporating makes an organization a legal
entity unto itself.
 Incorporating also protects the wealth of
owners from lawsuits.

Looking Ahead: The Economy of the
Twenty-First Century

Our economy provides much better for some
than it does for others.
 The Information Revolution continues to
change our economy.
 Our society must face the challenge of
providing millions of people with the computer
skills necessary to survive.
 In the new century, the economy will also
become increasingly global.
Politics: Historical Overview


Politics – the social
institution that
distributes power, sets a
society’s agenda, and
makes decisions.
Power – the ability to
achieve desired ends
despite resistance from
others.


Government – a formal
organization that directs
the political life of a
society.
Authority – power that
people perceive as
legitimate rather than
coercive.
Types of Authority
Traditional authority – power legitimized
through respect for long-established cultural
patterns.
 Rational-legal authority – power legitimized
by legally enacted rules and regulations.
 Charismatic authority – power legitimized
through extraordinary personal abilities that
inspire devotion and obedience.

Monarchy and Democracy
Monarchy – a
single family rules
from generation to
generation.
 This is typical in
agrarian societies.
 Monarchs remain in
several European
nations.

Democracy – a
type of political
system which gives
power to the people
as a whole.
 Most rich countries
of the world claim to
be democratic.

Authoritarianism and
Totalitarianism

Authoritarianism –
denies popular
participation in
government.
 This government is
indifferent to people’s
needs.
 People have little
opportunity to voice
their opinion.
Totalitarianism – a highly
centralized political
system that extensively
regulates people’s lives.
 Such governments are
total concentrations of
power.
 They allow no organized
opposition.

Politics in the United States

The political culture of the United States can
be summed up in one word: individualism.
 This emphasis derives from the Bill of Rights,
which guarantees freedom from undue
government interference.
 Welfare state – a range of government
agencies and programs that provides benefits
to the population.
Special-Interest Groups


Special interest group – a political
alliance of people interested in some
economic or social issue.
Political action committees (PACs) –
organizations formed by special-interest
groups, independent of political parties,
to pursue political aims by raising and
spending money.
Theoretical Analysis of
Power in Society
The pluralist model – sees power as
dispersed among many competing
interest groups.
 The power-elite model – sees power
as concentrated among the rich.
 The Marxist political-economy model
– explains politics in terms of society’s
economic system.

Terrorism, War, and Peace



September 11, 2001 was  War – organized armed
conflict between the
the most serious terrorist
people of various
act ever recorded.
societies, directed by
Terrorism – acts of
their governments.
violence or the threat of  Approaches to peace:
such violence used by
(1) Deterrence.
an individual or group as
(2) High-technology
a political strategy.
defense.
Terrorists try to paint
(3) Diplomacy and
violence as a legitimate
disarmament.
political tactic.
(4) Resolving
underlying conflict.