An economy is an area of the production, distribution, or trade, and consumption of goods and services by different agents. Understood in its broadest sense, ‘The economy is defined as a social domain that emphasizes the practices, discourses, and material expressions associated with the production, use, and management of resources’. Economic agents can be individuals, businesses, organizations, or governments. Economic transactions occur when two parties agree to the value or price of the transacted good or service. Commonly expressed in a certain currency. However, monetary transactions only account for a small part of the economic domain.

Economic activity is spurred by production which uses natural resources, labor, and capital. It has changed over time due to:

Technology (automation, accelerator of process, reduction of cost functions),
Innovation (new products, services, processes, expanding markets, diversification of markets, niche markets, increases revenue functions)

Such innovation produces intellectual property and changes in industrial relations (for example, child labor being replaced in some parts of the world with universal access to education).

A given economy is the result of a set of processes that involves its culture, values, education, technological evolution, history, social organization, political structure, and legal systems. As well as its geography, natural resource endowment, and ecology, as its main factors. These factors give context, content, and set the conditions and parameters in which an economy functions. In other words, the economic domain is a social domain of human practices and transactions. It does not stand alone in and of itself. ― Wikipedia

Jan

2021

Economy