Four - Four Whats of an Economic System $ What is produced?...

Info iconThis preview shows page 1. Sign up to view the full content.

View Full Document Right Arrow Icon
Four “What’s” of an Economic System $ What is produced? $ What amount is produced? $ What is the method of output distribution? $ What is the rate of economic growth? $ The secret to economic development can be summed up in the saying, “give a man a fish and you feed him for a day, but teach a man to fish and you feed him for a lifetime.” $ ADAM SMITH advocated creating wealth through entrepreneurship. $ Rather than divide fixed resources, Smith envisioned creating more resources so that everyone could be wealthier. $ Smith believed that FREEDOM was vital to the survival of any economy. $ Also, he believed that people will work hard if they have INCENTIVES for doing so. Circular Flow Model HOW BUSINESSES BENEFIT THE COMMUNITY The INVISIBLE HAND is a phrase coined by Adam Smith to describe the process that turns self-directed gain into social and economic benefits for all. Basically, this meant that a person working hard to make money for his or
Background image of page 1
This is the end of the preview. Sign up to access the rest of the document.

This note was uploaded on 03/26/2012 for the course GEB GEB1011 taught by Professor Henn during the Spring '10 term at Broward College.

Ask a homework question - tutors are online