Chapter 11, Economics and Politics

1. Chapter 11, Economics and Politics • The Economy • Major Economic Systems • World System Theory • The U.S. Economy as Number One • Political System and Power Forms of Government • The Political System of a Superpower

2. World Economic System Three major ongoing revolutions have shaped the world’s economic system: • Agricultural Revolution • Industrial Revolution • Information Revolution

3. Agricultural Revolution Two fundamental changes created foodsurpluses and and allowed society to support nonfood occupations: • 10,000 years ago - humans domesticated plants and animals. • 5,000 b.c. - invention of the scratch plow allowed farmers to use oxen to plow the soil.

4. Industrial Revolution • Mechanization added external power to hand tools and modes of transportation. • Changed the nature of work and transformed individual workshops into factories. • Combined with colonization, allowed colonists to force local populations to cultivate and harvest crops and extract minerals and other raw materials for export.

5. Information Revolution • Economy centered on the creation of information and delivery of services rather then the production of goods. • Majority of workers are not employed in manual labor. • Defined by the manipulation of numbers, words, images and other symbols rather than by the production of goods.

6. Major Economic Systems • Two extremes: Capitalism and Socialism • No economy fully realizes the principles of either.

7. World System Theory • Economic transactions transcend national boundaries. • No single political structure or national government has authority over the system of production and distribution.

8. Six Ways Capitalists Create Economic Growth • Hiring employees who will work for the lowest wages. • Securing raw materials at the lowest possible price. • Creating a new product that consumers “need”.

9. Six Ways Capitalists Create Economic Growth • Improving an existing product and making previous versions obsolete. • Expanding the outer boundaries of the world economy by creating new markets. • “Redistributing” wealth to enable more people to purchase products and services by offering higher wages or issuing credit.

10. 10 Fastest Growing Occupations (1996-2006) • Cashiers • Systems analysts • General managers and top executives • Registered nurses • Retail salespersons

11. 10 Fastest Growing Occupations (1996-2006) • Truck drivers • Home health aides • Teacher’s aides and educational assistants • Nurse’s aides and orderlies • Receptionists and information clerks

12. Reasons for the Decline in Union Membership • Declining significance of the manufacturing sector in the overall economy. • Increasing percentages of females in the workforce. • Increasing global competition, which adds pressure to keep wages down and keeps union influence at a minimum.

13. Forms of Government • Democracy • Totalitarianism • Authoritarianism

14. Participation in the Political Process • 62.1% of Americans eligible to vote were registered voters in 1998. • Only 51.2% of the voting-age population voted in the 2000 presidential election. • People between 18 and 24 were the least likely age group to vote.