Talking About Economic Systems and the Philippines

Philippines is a developing country and is included in the so-called Third World Countries. Please, don’t be misled by the word “developing” because it has a not-so-good meaning here in this topic. When we say “developing country,” we don’t mean that the country is really developing or in the process of developing or becoming into a sure and definite state which is a developed country. It’s a little bit sad but the real meaning is that the country is attempting to be in the process of developing. To be in the process is just a wish. A wish that is yet not meant to come true because Filipinos can’t still find the magic lamp whose genie will make the wish come true. We can clearly understand what is a developing country and a developed country if we compare the Philippines to country like the United States of America. Or we don’t go really far; we pick an Asian country: Japan. For better understanding, a developing country has high poverty rate; has high underemployment and unemployment rate; and has national debt from other countries.

Regressive or unstable economy is one of the manifestations that the country is a developing country. What is really economy? In the simplest definition, it is careful and efficient management of material resources. Material resources are everything that we need; everything that we work on to live; everything that we get after a hard work; everything that manufacturing companies produce; everything that stores sell; everything that we buy; and everything that we use. If we are entrepreneurs and we have our small-scale or household industry, the products that we are making or producing through the use of our hands or of a machine are material resources. These products are to be sold to become income of the industry that will make or produce new products. And this is one type of economic system.

Every country has its own economic system. A country establishes an economic system in order to efficiently manage the problem of scarcity – an economic state where economic goods or “mga kalakal na pangkabuhayan” in Tagalog or supply are deficient or not plentiful in quantity or number in proportion to demand. The economic system of a country refers to the institutions and the standards of manner as a whole that are institutionalized molding such an economic activity as business and industry. One example of this is the management of the natural resources to sustain the needs of the people. There are such basic economic problems to be considered by an economic system: what goods or products are to be produced; how many will be produced; how could it be done; to whom the goods or products are distributed; who will make the products; which segment of products are for private sector and for public sector; and how will production be progressive in the future?