An economic system is the combination of the various institutions, agencies, consumers, entities (or even sectors as described by some authors) that comprise the economic structure of a given society or community. It also includes how these various agencies and institutions are linked to one another, how information flows between them, and the social relations within the system (including property rights and the structure of management). A related concept is the mode of production.
The economic system involves production, allocation of economic inputs, distribution of economic outputs, land availability, households (earnings and expenditure consumption of goods and services in an economy), financial institutions and government policies. It involves a set of institutions and their various social relations.
Alternatively, it is the set of principles by which problems of economics are addressed, such as the economic problem of scarcity through allocation of finite productive resources. An economic system is composed of people, institutions, rules, and relationships. For example, the convention of property, the institution of government, or the employee-employer relationship. Examples of contemporary economic systems include capitalist systems, socialist systems, and mixed economies. Today the world largely operates under a global economic system based on the capitalist mode of production.
"Economic systems" is the economics category that includes the study of such systems. It includes comparative economic systems as a subfield.
Read more about Economic System: Components, Types, Evolutionary Economics, Context in Society, List of Economic Systems
Famous quotes containing the words economic system, economic and/or system:
“One set of messages of the society we live in is: Consume. Grow. Do what you want. Amuse yourselves. The very working of this economic system, which has bestowed these unprecedented liberties, most cherished in the form of physical mobility and material prosperity, depends on encouraging people to defy limits.”
—Susan Sontag (b. 1933)
“Until women learn to want economic independence ... and until they work out a way to get this independence without denying themselves the joys of love and motherhood, it seems to me feminism has no roots.”
—Crystal Eastman (1881–1928)
“A system of morality which is based on relative emotional values is a mere illusion, a thoroughly vulgar conception which has nothing sound in it and nothing true.”
—Socrates (469–399 B.C.)