Hey there!
This is your teacher Mr. H.,
and you’re watching History in a Hoodie.
Today’s episode is about Economic Systems
in Africa where we will learn all about how
countries make money.
I can’t wait to find out!
Well then, let’s get this show started!
What are we learning about today?
The standard for today’s lesson asks the
students to compare how traditional, command,
and market economies answer the basic economic
questions.
We will also explain that countries have a
mixed economic system located on a continuum
between pure market and pure command.
Finally, we will compare and contrast the
economic systems in South Africa, Nigeria,
and Kenya.
Before we start, let’s go over some vocabulary
for today’s lesson.
Much of this video should sound familiar because
two of the standards are word-for-word repeats
from earlier this year.
You should already understand the three basic
economic systems and how they are represented
on a continuum, so we will briefly review
these topics before exploring how they appear
in African countries.
There are three basic economic systems: market,
command, and traditional.
Traditional economies are never used for whole
countries – only ever found in small, remote
villages where bartering and trading are still
common.
The big systems are market and command.
A market economy is described by business
and consumers making the decisions about what
to buy and sell.
A business can decide what they are going
to produce or what service they will offer,
and the business will also decide how much
they are willing to sell their product or
service for.
The consumer (you and me) will make a decision
to buy or not to buy based on the product
and price.
Command Economies are kind of the opposite
of Market Economies.
Instead of businesses and consumers having
the freedom to decide for themselves, the
government dictates everything to do with
the economy.
Government planners decide what each company
will produce and the price that it will be
sold for.
Consumers are told what they can and cannot
purchase.
All told, not a ton of choice for everyday
citizens in a true command economy.
But, there is no such thing as a country that
is truly command or truly market.
Every country in the world has some qualities
of market and some qualities of command – which
means every country in the world is actually
a Mixed Economy.
How much command or how much market is really
the questions, and we display that answer
on an economic continuum graph like the one
shown.
Countries closer to the market side will have
a mostly free economy with just some government
intervention in certain areas of the economy.
For example, a country may allow most businesses
to do what they want, but utilities like water,
electric, and sewage are run by the government
to make sure every person gets clean and safe
access to water and power.
On the other hand, some countries are closer
to the command side and have a mostly controlled
economy with just some business freedoms.
This usually means that people in the country
are still under government control but some
businesses are allowed to participate in international
trade, under supervision by government officials.
How much economic freedom and how much government
control is a balance each government must
choose.
Too much freedom (meaning no rules) and businesses
can possibly cause harm to their workers,
consumers, or local environments.
Too much control (meaning many rules) and
businesses are unable to make profit or creative
people lose the encouragement to invent new
ideas.
Those are the difficult decisions governments
must make all the time.
So, what?
What are economies in African countries like?
Going back to our economic continuum graph,
I am now going to place our three countries
on it to represent how much freedom or control
each government has in the nations’ economies.
South Africa is considered moderately free.
The role of the government is relatively uninvolved
in business.
The government has ended most unnecessary
price controls, but there are still some government-ran
businesses that need to be fixed.
Nigeria is considered mostly unfree making
it a mixed, but leaning command economy.
There is a lot of government interference
in the economy.
The major industry, oil, is mostly run by
the government and international businesses,
so local businesses and consumers do not see
much results from that industry.
Kenya is also considered mostly unfree, also
leaning command.
The government confiscates land and property
that is not benefitting the economy.
The government has many economic problems
including poor national budgeting, overreliance
on trade, and illegal child labor practices
within the country.
Those three countries, South Africa, Nigeria,
and Kenya, represent some of the more established
nations in Africa and are on the stronger
end of economic success in the continent.
There are some other countries like Zimbabwe,
Eritrea, and Sudan that suffer worse economically
because of much more significant problems
in their governments.
Wow!
So, learning about African economies is really
important for me to understand.
I’m glad I learned it today!
Are you ready for some review questions?
I hope all the rest of you learned a lot from
today’s episode of “History in a Hoodie”
about the mixed economies of Africa.
If you did, don’t forget to like, subscribe,
and share….
Just kidding, I don’t care about that stuff.
But do make sure you study this lesson.
Bye now!
