LeoGlossary: Economy

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A large set of inter-related activities that revolve around production, consumption, and exchange activities. Through this we see the allocation of resources that are available.

This most often is analyzed based on a particular geographic area. We see this through the lens of local, national, and global.

Within cryptocurrency, we are seeing this pertaining to different blockchain or ecosystems such as Ethereum.

Economies can be:

  • Market-based - buyers and sellers determine what is produced
  • Centrally Planned - a select group of people, usually tied to the government, decide what is produced

The Soviet Union was an example of a centrally planned economy while the United States, to a large degree, is market-based.

Components

There are many factors that go into an economy. Here are some of the larger components that create differences:

  • Culture
  • Political System
  • Technology
  • Demographics
  • Institutions

The interaction between these areas have a direct impact upon how well, or poorly, an economy can do. When we factor all these together, it is easy to see why turning economies is not an easy task. Much of what happens is tied to the foundation of the nation.

General:

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