Download Economic Systems - Warren County Schools

LAISSEZ-FAIRE
“Free to do”
Adam Smith was the leading advocate
Market Economy-Markets free from government interference where businesses
can compete freely against each other for trade
Industrial Capitalism emerged as the main economic system in the Western world.
BUSINESS LEADERS
Industrial Revolution changed roles for business leaders
Entrepreneur-someone who starts a new business
Land owners lost power, Industrialists were gaining wealth and political power
Financiers, bankers, and investors pooled money together to create large
corporations
Andrew Carnegie-rags to riches success
Carnegie, Cornelius Vanderbilt, John D. Rockefeller, etc – “robber barons”
SOCIALISM
Robert Owen thought that for the good of all, society or the government, instead of
individuals, should own property and control industry
Efforts of Owens and others who agreed led to a movement called social democracy
COMMUNISM
More radical view of Socialism put forth by Karl Marx
Believed capitalism would lead to poverty
Believed capitalism disrupts the relationship between labor and profit
Believed there should be a direct connection between one’s work and one’s pay
In a communist economy, the government owns almost all the means of production
and controls economic planning
Communism is later used to violate basic human rights and freedom of choice
EFFECTS ON HOME LIFE
“Separate Spheres”- When men went to work, women stayed at home
Woman responsible for moral guidance
Lower class couldn’t afford for the mother to stay at home, still responsible
for guidance
EFFECTS ON COUNTRIES
Mass production increased their ability to build ships and make weapons
Countries were able to conquer and control sources of raw materials around the
world
Population growth
LONG-TERM EFFECTS
Standard of living improved
Leisure time
Citizens became more educated