| Term | Definition |
| democracy | government in which the people rule |
| republic | a government in which voters hold sovereign power; elected representatives, responsible to the people, exercise that power. also known as an indirect democracy or a representative democracy |
| federal system | a government that divides the powers of government between the national government and the state or provincial governments |
| unitary system | a government that gives all key powers to the national or central government |
| nation | group of people united by bonds of race, language, custom, tradition, and sometimes religion |
| nation-state | a country in which the territory of both the nation and the state coincide |
| market economy | an economic system which allows buyers and sellers acting in their individual interests to control the factors of production |
| factors of production | resources that an economy needs to produce goods and services |
| mixed economy | a system in which the government regulates private enterprise |
| oligarchy | a system of government in which a small group holds power |
| state | a political community that occupies a definite territory and has an organized government with the power to make and enforce laws without approval from any higher authority |
| John Locke | British philosopher who wrote that people were naturally endowed with the right to life, liberty, and property. to preserve their rights, they willingly contracted to give power to a governing authority. when the government failed to preserve the rights of the people, the people could justly break the contract. |
| Thomas Hobbes | a British thinker who wrote that the people surrendered to the state the power needed to maintain order. the state, in turn, agreed to protect its citizens. he didn't think the people has a right to break this agreement |
| Aristotle | a scholar in ancient Greece and was one of the first students of government |
| Adam Smith | a Scottish philosopher and economist who described capitalism in his book, The Wealth of Nations |
| Karl Marx | the father of scientific socialism, or communism. he was a German thinker who advocated violent revolution |