Economy

For other meanings see Economy (disambiguation).

An economy is a set of human and social activities and institutions related to the production, distribution, exchange and consumption of goods and services.It is also an organized way a soiety provides for the wants and needs of its people.

Examples of economies: the economy of Ireland, the World economy, the underground economy.

Main traits

• The main people and organizations involved in economic activities are: firms, workers, investors, consumers, States...
• An economy works in the frame of an economic system.
• The way it works (for example how the allocation of scarce resources is done) is studied by a social science: economics
• Economies demonstrate a degree of adaptive capacity giving resilience in the face of major perturbations, which helps minimise loss of function when beset by rapid social or economic change.

Sectorial evolution

The economy evolved in successive phases.

• The ancient economy was mainly based on subsistence farming.
• The industrial revolution lessened the role of subsistence farming, converting it to more extensive and monocultural forms of agriculture in the last three centuries. There is a growth in mining, construction and manufacturing industries.
• In modern consumer societies' economies there is a growing part played by services, finance, technology... (knowledge economy)

The balance between those various economic sectors (also called industries) differs largely between the various regions of the world. The nature of their natural resources and their level of economic development are among the main factors that led to those discrepancies.

GDP

The GDP - Gross domestic product of a country measures the size of its Economy.

See also

• Primary sector of industry
• Secondary sector of industry
• Tertiary sector of industry
• Quaternary sector of industry
• Ecological Economics

Categories

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