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