3.1.2 Economic Power in Context

This description of economic power in context shows how it relates to other dimensions of power, especially political and moral

Societies vary in the extent to which government decision-makers – who are referred to in this book as ‘politicians’ – play a role in the management of their economies.  At one extreme, under communism, the government made almost all economic decisions in a ‘command economy’.  At the other extreme, in a ‘market economy’, businesses make most of the decisions.  An Investopedia article, Market Economy vs. Command Economy: What’s the Difference?, explains this contrast further:

●  Market economies utilize private ownership as the means of production.

●  In a command economy, governments own the factors of production and set prices and production schedules.

●  In a market economy, prices are determined by supply and demand.

●  Most nations operate as a command or market economy, but all include aspects of the other.

A government’s role in managing the economy is defined in its legal and political systems.  A country’s Constitution determines the extent of legal oversight of the government’s powers (5.1.3), and its political system (6.1.2) determines how people are able to pressurise a government to pay heed to their moral concerns.

The government’s involvement in the economic system, and the roles of morality and the law, are explored further in the following sub-sections to put economic power in context:

●  The government, using legal powers, sets the regulatory framework within which the components of an economy operate and interact with each other (

●  Governments make economic transactions, collecting money in the form of taxes and spending it (

●  People’s moral values affect their economic behaviour and government economic policies (

●  Some examples are given of how some multi-dimensional topics are treated in this book, giving links to their separate economic, moral, legal and political treatment (



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This page is intended to form part of Edition 4 of the Patterns of Power series of books.  An archived copy of it is held at https://www.patternsofpower.org/edition04/312a.htm.