Political Economy: political, economical, legal systems of a country
are interdependent
political system
collective versus individualistic. democratic or totalitarian
collective - Plato
good of society over individualism
socialist - Karl Marx
pay of a worker does not reflect their actual value of labor. few benefit from capitalism. advocated for state ownership.
socialist- communist vs social democrats
communist- socialism can only be achieved through violent revolution and totalitarian dictatorship
social democrats- achieving through democratic means
in many countries state owned firms performed poorly
-no competition
-higher prices and taxes
Privatization
To change from government or public ownership or control to private ownership or control.
individualism - Aristotle
argued individual diversity and and private ownership is desirable. it will stimulate progress. private property gets more cared for than communal.
totalitarian
one person or political party has absolute control over human life
Communist Totalitarianism
used to be popular but it is declining now. most are communist in name
theocratic totalitarianism
political power is monopolized by a party, group, or individual that governs according to religious principles
Tribal Totalitarianism
A political system in which a party, group, or individual that represents the interests of a particular tribe (ethnic group) monopolizes political power.
Right-Wing Totalitarianism
A political system in which political power is monopolized by a party, group, or individual that generally permits individual economic freedom but restricts individual political freedom, including free speech, often on the grounds that it would lead to th
command economy
An economic system in which the government controls a country's economy. collective. "good of society
market economy
Economic decisions are made by individuals or the open market.
mixed economy
an economic system combining private and public enterprise. is becoming less popular
Common Law
A legal system based on custom and court rulings. tradition and precedent
Contract Law
the body of law that governs contract enforcement
Private Action
the theft, piracy, blackmail, and the like by private individuals or groups (mafia)
Public Action
the extortion of income or resources, property of property holders by public officials, such as politicians and government bureaucrats
Foreign Corrupt Practices Act (FCPA)
a law that prohibits U.S. corporations from making illegal payments to public officials of foreign governments to obtain business rights or to enhance their business dealings in those countries
a nation with democratic institutions, market based, legal system, protects property rights
is more attractive for business than one that is not.