Basic economic system
Dr. Rajmoni
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Basic Economic Types
in non-industrial system/preindustrial society
Foraging
Horticulture (Shifting cultivation)
Agriculture (Agrarian society)
Pastoralism
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Foraging:
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Foraging(hunter-
gatherers)
It is a basic social unit
Hunting and gathering
They rely on nature for resources
Natural environment is different: Asia, Europe, Africa, and the
Americas.
Men normally do hunting or fishing (Division of labor)
Women normally gather or collect fruits and foods from the
forest
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Examples for Foraging
Bush man in Kalahari desert of
South Africa
Some Islands in Malaysia and the
Philippines
During the ice age—European
used to hunt whales, seal, and
other big animals for consumption
Still Eskimo, Inuit of Alaska
practice seal hunting11/30/2
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Horticulture
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Horticulture
It is a part of agriculture
Grow plants, fruits, crops,
beautification
Horticulture, the branch of plant
agriculture dealing with garden crops,
generally fruits, vegetables, and
ornamental plants
([Link]
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Here, we will focus on Shifting
cultivation
They shift their land from place to place
They use simple tools: hoe & digging
stick
Lands are not used frequently
It has a fallow period (lie for some
periods)
But their houses/settlements do not
move
It also involves slash and burning
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What is slash and burning
Local vegetation is killed through fire
Burned ash transformed into natural
fertilizer
It kills pests by burning the forest
Later, soil becomes fertile
Land is not used frequently (stated
above) and
Waits for the next vegetation and soil
fertility
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Agriculture:
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Agriculture (Agrarian society)
Talking about pre-industrial society
It is more labor intensive than
horticulture
Land is used frequently (year after year)
Land uses for Double crops/ Triple crops
in Bangladesh
Landowners carry power and prestige
Landless become dependent on
landowners
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More on Agriculture
(Agrarian society)
Family members work together (Less division of
labor)
Domestic animal: Transport & Cultivation
Irrigation: they control water culturally and
mechanized way (Developed countries)
Subak irrigation system in Bali, Indonesia
Terracing: Steep hillside and practices in Indonesia
and the Philippines.
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Pastoralism:
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Pastoralism
Pastoral Nomad
Move according to the season from one place to another
(pastures are not fixed and irregular movement)
Moving all family members, including animals
They eat meat and drink milk
They also sell milk and meat during the movement
They do trade with other farmers
Example: Middle East, Mongolia, & North Africa
Transhumance:
It is a seasonal movement with herds (pastures are
fixed)
Some of them move with animals
Other members stay at home
Example: Kirghiz ethnic in Xinjiang Province, China &
Mongolia 11/30/2 14
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Production
Mode of Production:
Relationship between labor and
owner.
Example: Garments workers and owner.
Means of production: Land,
labor, and technology
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Economic System:
Production: Produce for the people
Distribution: Distribution of goods
items/food for local, regional,
national, and Int. consumers.
Consumption: For using (energy,
materials, clothes) and eating the
products (food, drinks).
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Distribution of Goods and
Services
Reciprocity
Redistributions
Market or Commercial
Exchange
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Karl Polanyi (Economic Anthropologist)
He defined 3 principles of exchanges
1. Market Principles
It Governance the means of production
Market exchange and try to maximize the benefit
2. Redistribution
It operates during goods, and services move
from the local to the center level.
Center may be capital, regional center, or
storehouse
3. Reciprocity: mutual benefits between people,
countries, and situation 11/30/2
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Reciprocity
Reciprocity happens between social equals who are
connected by kinship and marriage.
Normally, it happens in an egalitarian society (classless
society)
3 types of reciprocity:
Generalized reciprocity: Gift somebody without
expecting any return. It applies between close members.
Balanced reciprocity: Exchange applies between distant
relative members. They exchange gift items under a
balance.
Negative reciprocity: Exchange happens outside the
social system. It is like a market economy.
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Redistribution
Collection of goods in a center for
redistribution
It is found in most of the societies
Within the family member
Between the Chief and patron/client (If
there is a headman system)
It happens within a given territory
Redistribution brings prestige and
image to the society
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Market/Commercial Exchange
Kinds of Money:
Money plays the role of a medium of exchange, a standard
of value, and a store of wealth.
Transaction can be made when goods are being purchased
General Purpose money:
Universal accepted medium of exchange
It is used for commercial transactions (buying and selling)
Non-commercial (tax, fine, gift, contribution)
Degree of Commercialization: distribute food and goods
by reciprocity and redistribution. But their traditional
subsistence is changing to commercial.
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Subsistence Economy
Producing items just
for consumption, but
not for selling
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Industrial versus non-Industrial
(Mode of production: Social relationship
between laborers and owners)
Industrial:
Money buys labor power (Boss and Workers)
Labor means money
Social relationship is missing
Non-Industrial:
Labor are not bought and sold (It is an obligation)
It is a kin based mode of production (marriage or blood)
Mutual aid and cooperation
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Industrial versus non-Industrial
Industrial:
Produce for sale
People sell labor for cash
Work for companies’ benefit
Product is nothing to do with workers
Non-Industrial:
Economic relations between co-workers.
It is similar to social relations
Economic activities is embedded in society
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