The three economic sytems, capitalism, communism, and socialism have been considered, some what succinctly.
The associated defects of capitalism,communism, and socialism were described.
The associated defects of capitalism,communism, and socialism were described.
A number of factors affect the economic system in any given economy. These factors include the following:
1. The
Historical Background of the People: This factor pertains to
the historical antecedents of the people of a given region or country in terms
of their origins, ethics, norms and values as well as their customs and
traditions. Any economic system that
remarkably impinges on these basic beliefs is very likely to be resisted. For example, the Nigerian people as a result
of their circumstances of colonialism,
among others, have imbibed, nurtured, and sustained the mindset that one’s
position in life is a function of one’s own energy, courage and resourcefulness.
That is, one’s level of entrepreneurialism.
Based on this economic philosophy, successful businesspeople are
regarded highly in their communities. As
a result, any economic system that will negate or undermine this economic thinking will be highly rejected by the citizens.
2. The Extent of Wealth and
Natural Resources in an Economy:
Another factor affecting economic systems is the level of wealth and
natural resources in a given economy.
Nations rich in timber, mineral deposits, and fertile farmland, among
others, naturally support an agricultural and industrial population. This promotes
entrepreneurial activities and the accompanying economic system
(capitalism). On the other hand, nations
possessing inadequate natural endowments pose unique challenges to the
government, and in a bid to cater for the general welfare of their citizens,
such nations might embrace a more welfaristic system, as the case might be.
3. The
Political will of the People: This factor stems from the
people’s historical backgrounds. If an
economic system is insensitive to the citizens’ political consciousness and
sensibilities, dissatisfaction about it might alter the existing economic
system, and bring in the process a more welfaristic one.
4. Instability in the Mode of Governance: This factor refers to
short-term and frequent transitions among heads of government such that
long-term planning and policy implementation in the given economy gets
disrupted. As a result, the larger
populations might agitate for a change in the existing economic systems.
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