Christopher Livingston

3/22/17

Ch. 9 Thinking Geographically

Q. 1. What are the distinguishing characteristics of the economic systems labeled subsistence,

commercial, planned, and transitional? Are they mutually exclusive, or can they coexist within a

single political unit?

A: To begin, these economic systems all deal with the way people trade goods amongst the

people living around them. Subsistence economy is where goods and services are created for the

use of the producers and their kinship groups. This means that the people creating certain foods,

clothes, or some other product will be selling them to people maybe in just the surrounding city

they live in. A Commercial economy is where producers or their agents freely market their goods

and services, and market competition is the primary force shaping production decisions and

distributions. Take for example Wal-Mart, they have a higher corporation and agents overseeing

a large chain of stores to distribute the goods that they sale. Commercial economy is not limited

to one place. They spread and fill their supply due to what the people they are selling to want.

Now in a Planned economy the government has a lot more power in the choices of what

is sold and distributed. This can overlap both the proceeding economies due to the fact that they

will be taking place in (normally) a communist setting. In this setting, the government has all

control on money distribution, but there are a few exceptions that the book points out. There are

a few countries that are changing from this very form into something less government

influenced, what we call Transitional economies. In this example take Russias government that

used to be completely formed by the ideals of communism. They thence have turned away from
 Christopher Livingston
3/22/17

form and a planned economy and have changed to a more commercial one. (This is what we call

Transitional economy.)

As for answering if they can be one in the same, the answer is yes and no. Depending on

what two economies you are trying to put together, they can go hand in hand or not make sense.

If you have a community of farmers who trade amongst themselves and that is about it, you can

also have a Wal-Mart in the next city over. America has both subsistence and commercial though

we see less and less of subsistence now a day. As for the planned economy, you can only have

that in a communist country (or countries with similar government rule) where the economy

must be influenced by the government. And you may have planned economy with transitional,

but more than likely you must get rid of the government rule completely before ever changing

back.