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Concept Summaries

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Submitted By papiman21
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How People Make Economic Decisions
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ECO 212
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Economics is an important part of everyday life, and individuals live or die because of the merit of their economic system. All economic views can be set in one of three categories: the far left, the far right, and somewhere in the middle.
The government runs the far left of the economic spectrum to control the economy, and modern economic systems fall into two categories: Communism, and Socialism. According to Merriam-Webster online, communism occurs when the state has full economic control, everyone works for the state, the state owns everything, and the state distributes goods. Also according to Merriam-Webster online, socialism occurs when the state controls the manufacturing processes of an economy, and the states supports everyone along with the goods. In Socialism however, individuals can own property. The far left is often popular in poor nations, or in those nations dealing with a failing capitalistic system. A person in a far left economic system is always considered, and everyone receives a fair share of employment and goods.
The far left of economics has two problems, the first because this system of state controlled economics is weak, inefficient and not growth-oriented. The government sets up boards and companies to run industries, and if these boards or companies fail, they will cover up their mess, instead of fixing the mess. Eventually the weakness of one industry or organization affects others in this process. Even in an ideally running communist country, growth is not encouraged by the system. If everyone has work and food, there is no need to change anything. New technologies or processes of work occur very slowly because there is no competitive necessity for them, which encourages inefficiency. The second problem of the left is corruption. When any entity allows too

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