Intro to Business & Technology Week 1 Essay

502 Words3 Pages
The economic system that is best suited for cope and recover in the event of a disaster would be the free market system. Since majority of the resources are owned by private sector, the government can focus on assisting and reestablishing economic activity. Natural disaster like hurricane, flood, blizzard, and forest fire can disrupt infrastructure of the economy, and thus the government’s main responsibilities is to reestablish those infrastructure. In turn, government will lend money like grants and low interest loans to private sectors. According to Bovee & Thill (2001), “private parties (individuals, partnerships, or corporations) own and operate the majority of businesses and where competition, supply, and demand determine which goods and services are produced” (p. 28), the profit driven companies are motivated to work and rebuild. As the economy grow, the production capability will increase as well, which leads to increase of demand for goods and services. The increase in demand for goods and services will eventually develop a division of labour, capital, and businesses. Eventually, the economy of the affected area will be regenerated and no long need the aid of the government. A socialist system might be advantageous in the event of earthquake that occurred in Haiti in January 2010 because in a socialist system, the government provide free services and healthcare. Bovee & Thill (2001) stated that socialism adopt the principle of production for use and government has “fairly high degree of planning and ownership of capital resources” (p. 29). So then, the government are responsible for delivering resources and treatments to each individuals regardless of their financial situations. Usually in a socialist system, government has already made plans ahead of time in case of emergency, such as the Federal Emergency Management Agency, so then when disaster does
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