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Economy
Economy
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Economics - Political Economy - Prof. Uddeepan Chatterjee, Study notes of Economics
Summary about Political Economy, Political System, Collectivism, Socialism, Individualism, Democratic System.
Typology: Study notes
2010/2011
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Political
Political
Economy
Economy
Political Economy
Political Economy
Political Economy originally is the
Political Economy originally is the
term for studying production, buying
term for studying production, buying
and selling and their relation with law,
and selling and their relation with law,
custom and govt.
custom and govt.
Political and economic environment
Political and economic environment
has an important impact on market
has an important impact on market
selection and business strategy
selection and business strategy
formulation
formulation
Political Systems
Political Systems
Political
Systems
Collectivitism/
Socialism
Individualism Democratic
Collectivism
Collectivism
It refers to a political system that
It refers to a political system that
stresses the primacy of collective goals
stresses the primacy of collective goals
over individual goals.
over individual goals.
Individual rights should be sacrificed
Individual rights should be sacrificed
for the good of the society.
for the good of the society.
Collectivism has been picked by
Collectivism has been picked by
Socialism.
Socialism.
Socialism
Socialism
Communists
Communists
They believe Socialism could
They believe Socialism could
be achieved only through be achieved only through
violent revolution
violent revolution
Social Democrats
Social Democrats
They believe in achieving They believe in achieving
socialism by Democratic
socialism by Democratic
means
means
Socialist Camps
Individualism
Individualism
It refers a political systemIt refers a political system
where individual economic &
where individual economic &
political freedoms are the
political freedoms are the
ground rules on which a society
ground rules on which a society
should be based.(USA)
should be based.(USA)
Welfare of society is best
Welfare of society is best
served by letting people pursue
served by letting people pursue
their own economic self
their own economic self
interest.
interest.
The Pro-Business & Pro-Trade
The Pro-Business & Pro-Trade
values of individualism create a
values of individualism create a
favorable environment within
favorable environment within
which International Business
which International Business
can grow.
can grow.
Political Systems and
Political Systems and
International Business
International Business
Political environment of any country
Political environment of any country
Economic Policy of ruling party
Economic Policy of ruling party
Political decisions
Political decisions
Economic System
Economic System
An Economic system is the
An Economic system is the
process of production,
process of production,
distribution and
distribution and
consumption
consumption
of products and services of
of products and services of
an economy
an economy
Free Market Economy/Capitalist
Free Market Economy/Capitalist
Economy
Economy
Freedom of Pvt. Enterprise is greatest.
Freedom of Pvt. Enterprise is greatest.
The factors of production
The factors of production
(Labour,Land,Capital) are pvtly owned &
(Labour,Land,Capital) are pvtly owned &
production occurs at the initiative of the pvt.
production occurs at the initiative of the pvt.
Enterprise.
Enterprise.
The free market economy is not
The free market economy is not
planned,controlled or regulated by the govt.
planned,controlled or regulated by the govt.
The Govt. does not compete with pvt. Firms.
The Govt. does not compete with pvt. Firms.
Eg. USA,Canada
Eg. USA,Canada
Command/Centrally Planned
Command/Centrally Planned
Economy
Economy
The State owns all the means of factors
The State owns all the means of factors
of production.
of production.
The State determines the goals of
The State determines the goals of
production.
production.
Overall State controls the economy.
Overall State controls the economy.
Eg.The Communists China,Hungary,Poland
Eg.The Communists China,Hungary,Poland
State Directed Economy
State Directed Economy
In this economic system, the
In this economic system, the
State plays a significant role
State plays a significant role
in directing the investment
in directing the investment
activities of Pvt. Enterprises
activities of Pvt. Enterprises
through Industrial policy &
through Industrial policy &
in otherwise regulating
in otherwise regulating
business activities in
business activities in
accordance to national goals.
accordance to national goals.
Eg.Japan.South Korea
Eg.Japan.South Korea
Economic Environment &
Economic Environment &
International Business
International Business
Structure & Nature of Economy
Economic Conditions Economic Policies
Economic Policies
Economic Policies
Industrial Policy
Industrial Policy
Trade Policy
Trade Policy
Foreign Exchange Policy
Foreign Exchange Policy
Monetary Policy
Monetary Policy
Fiscal Policy
Fiscal Policy
Economic Conditions
Economic Conditions
Boom
Boom -High level of output, employment
-High level of output, employment
& rising demand
& rising demand
Recession
Recession
- Opposite of above.
- Opposite of above.
Economic conditions can be :
Economic conditions can be :
Widespread-
Widespread- Eg.Worldwide recession
Eg.Worldwide recession
Regional-
Regional- Eg.South East Asia Economic
Eg.South East Asia Economic
recession
recession