israel has a mixed economic system
TRANSCRIPT
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• Israel has a mixed economic system.
• According to the Index of Economic Freedom, Israel is 70% free and 30% command.
• Private businesses in technology, agriculture, and tourism, determine their own production of goods and services.
• Prices are based on supply and demand.
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• While private enterprise plays a role in Israel’s economy, the government also has a hand in the country’s economic planning.
• The government controls the electric, natural gas, and aerospace industries, and most of the land is government-owned.
• It charges various taxes and controls prices on agricultural goods and banking services.
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© Brain Wrinkles
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• Israel has the most diversified economy in Southwest Asia.
• Its important industries include: mining, cutting and polishing diamonds, agriculture, & manufacturing tech equipment.
• Also, a high percentage of Israelis work in the service industry, as Israel is a popular tourist destination.
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Israel’s Tourist
Destinations:
Jerusalem
Tel Aviv
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1. What to Produce? Individuals and corporations; government has some regulations
2. How to Produce? Individuals and corporations; government has some regulations
3. For Whom to Produce? Individuals and corporations; government has some regulations
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• Since its creation in 1948, Israel has been involved
in much conflict with its neighbors.
• Building up its national security and maintaining its
armed forces has put a strain on Israel’s economy.
• Another financial burden has been large volumes of
immigrants, even though they have brought
valuable skills to the country.
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• In 1932, when Saudi Arabia became a nation, its economy was mostly traditional and consisted of trading camels, goats, & textiles.
• When oil was discovered, the Saudi royal family transformed the economy into mostly command and profited greatly from oil wealth.
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• Today, the government still controls most of the oil industry, but it has begun to diversify the Saudi economy in other areas.
• The government has begun to encourage private enterprise in areas like power generation and natural gas exploration.
• With a large part of revenue now coming from private businesses, Saudi Arabia now has a mixed economythat rates as 64% free and 36% command.
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• The government is trying to grow the private sector in order to diversify the economy.
• Private businesses are being asked to take on a greater role in education, healthcare, and tourism.
• The Saudi government has even started selling shares of the country’s petroleum company to the public.
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Saudi Aramco is the state-run company that owns, operates, and
develops all of the oil and natural gas reserves in the country.
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• Despite the recent changes, the Saudi government is still very involved in the country’s economy.
• It lets private companies make few decisions about production and prices.
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1. What to Produce? Individuals and corporations; government has many restrictions on the oil industry
2. How to Produce? Individuals and corporations; government has many restrictions on the oil industry
3. For Whom to Produce? Individuals and corporations; government has many restrictions on the oil industry
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• Income from oil accounts for 75% of the country’s
budget; however, oil supplies don’t last forever.
• Saudi Arabia’s unemployment rate is high.
• One-third of Saudi Arabia’s jobs are filled by
people from other countries because the country
has a shortage of skilled native labor.
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• When Turkey became a country in 1923, its ruler Mustafa Kemal set up a command economy.
• Kemal believed the government should control & build the economy, so he invested in the country’s infrastructure: dams, electricity, ports, railroads, and roads.
• The government also developed important steel and weapon industries.
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Mustafa Kemal Ataturk
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• Reforms in Turkey since the 1980s have moved it to a mixed economy.
• Today, Turkey is by far the largest economy in the Middle East, and it rates as 65% free and 35% command.
• The Turkish government has aggressively privatized state-owned industries in recent years and private enterprise is growing in agriculture, electronics, textiles, automotive, and petrochemicals.
• Private companies are able to decide how much to produce and to set prices based on supply & demand.
• Much of Turkey’s land, businesses, and factories are privately owned.
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Private enterprise is growing in the agricultural
industry.
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• The state still has an active role in Turkey’s economy; it plays a major part in industry, communication, banking, and transportation.
• It charges taxes on businesses and some of its regulations are difficult to comply with, which has led to an increase in government corruption.
• The government sets price controls on electricity and some food items.
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1. What to Produce? Individuals and corporations; government has some regulations on industry, banking, transportation, & communications
2. How to Produce? Individuals and corporations; government has some regulations on industry, banking, transportation, & communications
3. For Whom to Produce? Individuals and corporations; government has some regulations on industry, banking, transportation, & communications
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• Turkey lies partly in Europe and partly in Asia.
• Because most of Turkey’s trade is with Western
Europe, so it has been trying for years to join the
European Union.
• Unfortunately, Turkey is considered a developing
nation and remains poor when compared to most
European countries.
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