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Economic systems

             Human's needs for society and government results in economics which answers the questions what, how, and how much should be produced. Varying economies are a reflection of different government's approaches to these questions. Based on differing levels of government intervention, economies can generally be classified as one of three distinct systems; market, mixed, or command. Although each system has its own positives and negatives the mixed economy would seem to be the most effective in fulfilling the majority of the populations needs.
             On the right side of the economic spectrum lies the capitalist or market economy in which the government has very little, or in its pure form no government intervention in economic affairs. This type of system advocated by Adam Smith was practiced by both British and American governments during the industrial revolution and led to productive but unstable economies consisting of booms and recessions. Many entrepreneurs became very rich but the number of wealthy people was small when compared to the number of poor ones, and the middle class was all but nonexistent. Social inequalities and class differences were harshly apparent. The unrestricted pursuit of profit left the worker's welfare solely in the hands of the employers who were free to impose any conditions they pleased. Often this resulted in dangerous working conditions, extremely low salaries, and terrible living conditions. There were also no regulations in place to limit the minimum age for working or maximum job hours. Lack of government intervention was shown to be practically ineffective when it caused the great depression in the 1930's by allowing wages to remain low as productivity increased and the demand for goods could not keep up with the increased supply. This system also left the stock market unregulated which led to its crash which also contributed to the depression.

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