1. Washoe County School District C 7.6.2 Define the world’s major economic systems,
including capitalism, mixed economy, socialism, command
Social Studies Sixth Grade Units economy.
Lesson 1
Scott Foresman Different Economic Systems
Social Studies
1 Introduce How is a mixed economy a blend of
• Ask students to name some products, capitalism and socialism? (Individuals,
such as milk, cereal, toothpaste, clothing, businesses, and the government all own
and pencils, that they have used today. parts of the economy and decide how to
make and distribute goods and services.)
• Explain to students that every country has
3 Assess and Extend
an economic system that determines how
people will make and get the items they Assess After students complete their charts,
need every day. direct them to sources that will help them
identify the economic systems of various
• Tell students that in this lesson they will other countries around the world. Have
learn about different economic systems students define and label different economic
around the world. systems on a world map and then discuss
2 Teach how the economic systems differ.
Ask students to read the lesson. Review Extend Have students choose an economic
the meaning and pronunciation of any word system and then write journal entries from the
that might be unfamiliar to students, such possible points of view of different people in
as economic or distribution. Provide some a society that has that system. For example,
background on how economic systems can a student could choose capitalism and write
change as a result of political uprisings and from the perspectives of a factory owner and
rebellions. Explain to students that during the a factory worker. Ideas in the journal entries
Cold War, many countries in Eastern Europe should be supported by research about the
had socialist economic systems. However, economic system.
after the fall of the Soviet Union, many
Eastern European countries adopted more
of a mixed economic system. Then ask: Answer
Key Lesson 1 Different Economic Systems
What is an economic system? (A system
for producing and distributing goods)
Who Makes
How is capitalism different from a Economic Who Owns the
Economic
System Resources
command economy? (In a capitalist Decisions
economy, individuals and businesses own lndividuals and Individuals and
most of the things used to produce goods, Capitalism
businesses businesses
and individuals and businesses buy and People, through Representatives
sell goods freely. In a command economy, Socialism
their government of the people
the government owns the resources used Individuals, Individuals,
to produce goods, and it decides how to Mixed
businesses, and businesses, and
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Economy
produce and distribute these goods.) government government
Command
Government Government
Economy

2. Name Date
Grade 6, Lesson 1
C 7.6.2
Different Economic Systems
Read the passage.
Every society must answer difficult economic questions, such as “How should
people use resources?”, “What goods should people produce, and in what quantities?”,
“Who should get the goods that are produced?”, and “How much should they pay for
these goods?” How a society answers these questions depends on its economic system. An
economic system is a way of producing and distributing goods and services. There are four
major economic systems in the world today: capitalism, socialism, command economy, and
mixed economy.
In a capitalist system, individuals and businesses own most of the natural and capital
resources. These are the factories, farms, machinery, land, minerals, and other resources
used to produce goods. Individuals and businesses also buy and sell goods freely. Goods are
distributed through the market of buyers and sellers. Capitalism is the economic system in
the United States.
Socialism is another type of economic system. In a socialist system, the people,
through their government, own many of the resources and manage the economy.
Representatives of the people decide what to produce and how much. The government
then plans how to carry out these decisions. The government also distributes most goods
and services, especially with regard to housing, food, medicine, and other basic necessities.
Many nations today engage in limited socialist programs, such as socialized medical or
education systems. However, only a few nations can be said to operate entirely under
socialist principals.
The third type of economic system is a command economy. In a command economy,
the government owns nearly everything that is used to produce goods. Government
planners, rather than the people, make the decisions about what to produce and how to
distribute it. North Korea is an example of a country with a command economy.
In a mixed economy, individuals, businesses, and the government own some parts of
the economy. All of these groups play a role in making economic decisions about what to
produce and how to distribute it. Russia was once part of the former Soviet Union, which
had a command economy. Russia now has a mixed economy.
Complete the chart with information about each economic system.
Economic System Who Owns the Resources Who Makes Economic Decisions
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Capitalism
Socialism
Mixed Economy
Command Economy