key terminology

Protectionism-Government actions and policies that restrict or restrain international trade , often done with the intent of protecting local businesses and jobs from foreign competition. Typical methods of protectionism are import tariffs, quotas, subsidies or tax cuts to local businesses and direct state intervention.

joint ventures-A business arrangement in which two or more parties agree to pool their resources for the purpose of accomplishing a specific task. This task can be a new project or any other business activity. In a joint venture , each of the participants is responsible for profits, losses and costs associated with it. However, the venture is its own entity, separate and apart from the participants' other business interests.

economic reform-The term microeconomic reform (or often just economic reform) refers to policies directed to achieve improvements in economic efficiency

special economic zones-A Special Economic Zone  is a geographical region that is designed to export goods and provide employment. these are exempt from federal laws regarding taxes, quotas, FDI-bans, labour laws and other restrictive laws in order to make the goods manufactured in the SEZ at a globally competitive price.

globalisation-Globalisation is the process by which the world is becoming increasingly interconnected as a result of massively increased trade and cultural exchange. Globalisation has increased the production of goods and services. The biggest companies are no longer national firms but multinational corporations with subsidiaries in many countries.

command economic system-A system where the government, rather than the free market, determines what goods should be produced, how much should be produced and the price at which the goods will be offered for sale. The command economy is a key feature of any communist society. China, Cuba, North Korea andthe former Soviet Union are examples of countries that have command economies.

mixed economy-Mixed economy is an economic system in which both the state and private sector direct the economy , reflecting characteristics of both market economies and planned economies Most mixed economies can be described as market economies with strong regulatory oversight, and many mixed economies feature a variety of government-run enterprises and governmental provision of public goods.

transitional economy-A transition economy or transitional economy is an economy which is changing from a centrally planned economy to a free market Transition economies undergo economic liberalisation  , where market forces set prices rather than a central planning organization. In addition to this trade barriers are removed, there is a push to privatise state-owned businesses and resources, and a financial sector is created to facilitate macroeconomic stabilization and the movement of private capital The process has been applied in china.


public sector-the public sector is the part of the economy that is run directly by the government this includes services such as NHS , police and education. an economy that reflects this is cuba.


private sector-The private sector is the part of the economy that is run by the public and entrepreneurs through business's and companies all profit goes to them