Why does economic change occur?
Economic change occurs because of many reasons.
• Economic change occurs because of war. This change happens because of the fact that when war takes place the value of a currency from the country at war can increase or decrease. Due to the fact that this change in value happens the economy can benefit from it or have a significant down fall.
• Economic change happens because of new inventions that are made. For example, when factories were built and machines were used more often to perform the work that had to be done, the farmers lost a lot of money because of the increase in the production of the factories.
• Economic change also happens because of the circular flow of income. When economy is running smoothly the flow of income is also running smoothly, though when something disrupts the flow, any areas of the economy are affected by it. For example, if you lose your job, then you won't have any money to buy from the stores which will result the store not to make any money so they will have to cut down on the production of goods. Since the production of goods has stopped the factory will have to let more people go, and therefore you see the circle happen over and over again.
How does economic change affect other aspects of society?
Economic change affects society in both positive and negative ways.
• Economic change affects society in a positive way because it can provide more jobs for people. Also, positive economic change can help business grow which in the long run will lead to more positive economic change. Another reason why positive economic change can affect aspects of society is because it will bring a higher population to a community or city which in the long run will also result in a greater positive economic change.
• Economic change affects society in a negative way because people will lose their jobs and make the circular flow of income almost come to an end. Also, there will be to any people with out a job so they can lose their cars and houses and other important valuables. The government will also be in debt of billions to trillions of dollars and it would take many years for it to recover. Lastly, Economic change affects society in a negative way because they will be more crime since people are so eager to have money and survive.
How do people react to economic change?
People in a community can react to economic change in both a positive and negative way:
• People react to economic change in a negative way because if the economy is bad then the way citizens live will be bad. If a very luxurious family experiences a great economic down fall then they would ultimately lose their house and jobs and cars. Also, another way that people would react very negatively to economic change is that they would commit more crimes just to survive and be able to give themselves and their families the luxury that they once had.
• People react to economic change in a positive way because there will be more jobs available and so the citizens of a country can make more money. If the economic change is a positive one then of course the people will react very positively because with are gaining something from it.