Textbook Notes (363,145)
Canada (158,221)
MGTA01H3 (583)
Chapter 3

MGTA01H3 Chapter 3: chp 3 business

7 Pages
Unlock Document

University of Toronto Scarborough
Management (MGT)
Chris Bovaird

Chapter 3 Economic Systems Introduction: economics: the study of how people produce the things they need and want the goods services that are produced made available to us are from a mix of forprot notforprot organizations (called economic systems) economic systems: the means by which a society produces distributes the goods and services that its people need Through its choice of economic system, a country determines the following who owns the factors of production who controls the factors of production who decides what needs to be produced who decides how goods services are distributed the division of what gets produced distributed by businesses and what gets produced distributed by the government has evolved through Canadian history because it seems to work for us (i.e. Canadian accept the fact that health care is publicly funded by the government but in other countries this may be seen strange) Just as in Canada, the economic systems used by other countries have evolved, inuenced by politics, culture and tradition and have been shaped by historical events Economic Systems: Planned Economies Versus Market Economies we can divided all countries into one of two categories: planned economies: countries in which most of the factors of production are controlled by the state market economies: countries in which most of the factors of production are controlled by individuals and where entrepreneurship and business ownership are encouraged those who advocate for a planned economic system base their arguments on two key points: only the state, with its ability to create and enforce the law, has the power and the authority necessary to feed, clothes, shelter, educate and employ the nations entire population businesses are primarily concerned with making a prot. Therefore, businesses have no concern for those who arent customers or do not have the money to buy products. Only the state has a benevolent interest in the welfare of all members of society Those who argue for market economics argue the following: state control works poorly in practice. people need an almost innite variety of things (coffee, shoes, toothpaste, etc.) The full range of peoples needs, people of different genders, ages, tastes are personalities is simply too vast for any one entityeven the government to plan, produce and distribute effectively government bureaucrats lack the information and the feel for the average persons chasing needs tastes. government ofcials wont have the skills, information or motivation to effectively run a local barbershop for example. a benet of private enterprise is competition. without that competition, enterprises can become unresponsive, wasteful and inefcient. planned economic systems concentrate a great deal of power into the hands of a small number of the political elite (power can be corruptive and political leaders can be selsh and greedy like anybody else) Planned Economies:
More Less

Related notes for MGTA01H3

Log In


Don't have an account?

Join OneClass

Access over 10 million pages of study
documents for 1.3 million courses.

Sign up

Join to view


By registering, I agree to the Terms and Privacy Policies
Already have an account?
Just a few more details

So we can recommend you notes for your school.

Reset Password

Please enter below the email address you registered with and we will send you a link to reset your password.

Add your courses

Get notes from the top students in your class.