Social 30-1: Economics

Modern liberal

Believe that freedom cannot be achieved unless the government steps into assure that it does

Collectivism

Believing and doing what is best for society

Individualism

Believing and doing what is best for the individual

Welfare state

A capitalist economy combined with a government that uses policies that directly or indirectly modify the market forces in order to ensure economic stability and a basic standard of living for its citizens

Welfare capitalism

A classical liberal economic system combined with a government that used legislation to give workers protections and a safety net with features like pensions

Transfer payments

A collection of fiscal equalization processes used in Canada

Industrial revolution

A revolution in Britain and US that lead to many mechanical developments like steam power and also helped create a more industrialized society

Invisible hand

A term created by Adam smith used to describe the pursuit of profits guided entrepreneurs to determine what consumers want

Keynesian economics

AKA: demand side economics, consists of fiscal policy, when taxes are low the government should spend more, when taxes are high government should spend less

Left wing radical

Communist

Classic liberal

See government intervention as an infringement on the freedoms of individuals

Supply and demand

The amount of product available and the desire of buyers for it considered as factors regulating its price

Boom & bust cycle

The cycle of economics that after every high period is followed by a low period ex: the roaring 20's then the Great Depression

Profit motive

The desire to make money

Milton Friedman

The economist most closely associated with monetarism

Friedmans views on inflation

The money supply is controlled through regulation of interest rates, when the money supply was increased, consumer spending would also increase, causing demand to rise and inflation to increase

Privatization

The process of transferring an enterprise or industry to the private sector from the public sector

Consumer sovereignty

The theory that consumer taste and choice determine what products are produced

Fiscal policy

When taxes are high, government spends less, when taxes are low government spends more

Dollar voting

When people purchase products they cast a _________

Capitalism

An economic system where a country's trade and industry are controlled by private owners for profit rather than the state

Adam smith

An economist that believed in laissez faire capitalism and invented the term "the invisible hand"

Hayek

An economist who was a critic of collectivist thinking since before WWII

Free market capitalism

Capitalism

Laissez faire economics

Capitalism

Market oriented economics

Capitalism

Free market economy

Economy found in the middle of the spectrum, includes government involvement in economic decision making but still maintains a citizens individual freedom

Crown corporations

Entities somewhere between a government body and a private enterprise, owned by the state but operated at and arms length

Deficit spending

Government spending in excess of revenue of funds raised by borrowing rather than from taxation

Trickle down economics

If the government and upper class are doing good, it would eventually effect the lower and middle class positively

Arguments against government regulation

More competition, dollar voting, supply/demand, bureaucracy takes longer to approve items

Tax concession

Lowering taxes

Combination Act

Prevented workers from forming unions in the industrial revolution

Arguments for government regulation

Prevents corruption, quality/safety of products, improved quality of life, sets regulations

Demand side economics

Regulates demand

Supply side economics

Ronald Reagan's idea to reduce income and business taxes, reduced regulation and increase spending on military and it would increase investment

Democratic socialism

Socialism Ex: Sweden's government

Collusion

Two things working together Ex: unions

Neo-conservatism

Type of thinking and beliefs supported by Ralph Klein, Margaret Thatcher and Ronald Reagan, supply side economics, Thatcherism, trickle down economics etc...

Stagflation

When a recession and high inflation occur at the same time

Monetary policy

When interest rates are high it discourages spending, when interest rates are low it encourages spending

Tax loophole

Ways companies can get out of paying taxes