Economic in Time
You might have heard the term “economic” many times, but what exactly does economic mean? Also, how does economic affect our daily life and the world? Economic is the study of how people satisfy their wants and needs with the limited resources they have. Economic often involve in money and currency. The two main bases of economic are wants and needs. Needs are our basic needs to survive, and wants are everything else beside needs and are unlimited. People have wants and needs, and when they take actions to satisfy their wants and needs it involve economic. Economic is in every corner of the world. You involve in economic every day. Economic has exists for a very long time in human history. As the time proceeds and technology advance, economic has evolved into various form and has more connection with the world rather than individual.
In the ancient time of the human being, people used to be self-reliant, meaning that they are able to fulfill their own wants and needs using any resources they can get from their environment. People grow their food and make their own cloth. Later in time, when people start to come and live together, towns and villages were formed. People then start to trade with each other using what they have for what they need. During the Middle Ages, most of the people’s possession belongs to the rulers or the upper class and little for the people themselves.
It is not until the 19th century that people start to come up with ideas that made up most of the modern day economy. 19th century is the time of changes and revolutions. It is the time where capitalism and socialism rise to power. “Capitalism” is a kind of economic system which the means of production and profits were privately own. It is the idea of a 19th century British philosopher named Adam Smith. Good thing about capitalism is that it generate large amount of profit and boost up the economy. However, it often results in the exploitation of the working class for most of the profit goes to the middle class and the upper class. The working class only got a very few share. This is when “socialism” rise to power and compete against capitalism. Socialism is a kind of economic system in which the means of production and profits were public own. In socialism, people cooperate and share the profit. It Is the idea of a 19th century German philosopher named Karl Marx. Socialism can produce a fair and cooperative economy. However, not everyone wants an equal share and socialism often results in the exploitation of the middle class. Also, it is hard to boost up the economy when all the profit was equally divided.
So what should people do if they want a fair economic system that also generate large amount of profit? The solution is a “mixed economy”. A mixed economy is the combination of the idea of both capitalism and socialism. The mixed economy allows means of production and profits to be privately own. However, the employer or the middle class must give the working class the share and treatment they deserve. The idea of mixed economy also started out in the 19th century, and is most common economic system adopted by the developed nations. Usually, in a mixed economy, there are two main factions, the enterprise and the labor union. The enterprise is the middle class people who generate and own the profit. The labor union is mostly consisted of people from the working class. These people help the enterprise generate profit, but don’t own the profit. They could, however, demand the enterprise to give them a proper share of profit or treatments. If not, they could go on a strike which will cause the generation of the profit to stop. Mixed economy balances the power between the working class and the middle class.
The reason people study economics is because they want to have a good idea on whether they are spending their limited resource in a good way. People want to know if they make full-use of the resources. They want to know if they are making the right decision, in another word, does it worth it? Economic have change in time. It has evolve from the basic self-reliant economic to global economic which everyone in this world is responsible for the change in it. Economic has become one of the greatest global issues nowadays. It is now the representation of power in modern day.