What is Economics?

Here is a simple video to teach you about the basics of economics:

      

Scarcity vs Shortage

• Scarcity has limits and depends on the availability of resources and goods, while shortage is a temporary loss of resources or availability of resources.
• Scarcity and shortage are problems in economics that result into the lack of economic goods. 
• The causes of scarcity and shortage are limited resources that cannot be filled up or built up ever again by production.
• Scarcity is the fundamental problem in economics because it has limitation of resources and cannot be replenished while shortage is temporary.

Scarcity & Smart Choices

Out of the two economic problems stated above, the worse would be scarcity. It, as is frequently repeated, is the fundamental problem of economics. This problem arises because our resources are limited yet human needs and wants are unlimited, causing a deficiency in supply, and forcing us to make smart economic choices and decisions about the efficient allocation of our resources and investments.

In the everyday situation of deciding whether to walk to your destination or take a vehicle as transportation, you are given a choice: walk and save money, at the expense of time, or take a vehicle and save time and energy, at the expense of money. 

There isn't necessarily a correct choice, as the decisions we make mostly rely on the situation we are in, yet there exists a wise choice, wherein you willingly put off your wants in order to sustain your needs, sacrificing short-time desires for long-term sustainment. 

Needs and Wants

• A need is something that you should have, you should have to have, or something you couldn't live without. 
• An example is food; you need food to live. Without it, you would die, and thus, it is really necessary. 
• A want is something that you like to have, and not really necessary, but it will be quite good to have. 
• If it is based on economics, needs are economic requirements that are necessary for you to keep living. 
• Wants are desires to fulfill your needs. Based on economics money is a want. You need to get a job to have money. 
• Also, a person's view to needs and wants can change. It depends on that person's situation, satisfaction, or desire.

The act of balancing our needs and wants,

an example that humans should follow.

Production, Distribution, and Consumption

• Production - is the creation of goods made out of raw materials.

• Distribution - is, like its name states, the act of distributing the goods produced to the public. The share that they receive varies in accordance to their position in the economic standing, and the amount they paid for the said product.

• Consumption - is the usage of the said good or product

These three rely on one another, and one would be useless without the other two. Together, they make up the famous economic cycle (P, D, C). The materials produced are based on what and how much is needed to be consumed, while distribution relies on the amount of goods produced. Lastly, consumption is based on the part that they receive during the distribution of the goods and services, unable to consume/use more than they have.

A shortage on one would cause the other to fall as well, and an increase in one will result into a much higher demand on the other. Each is just as important as the other.

Economic Systems

All in all, there are four economic systems:

• Traditional Economy
• Mixed Economy
• Command Economy
• Market Economy

Here is a short video about the different Economic Systems:

Market Economy

• A market economy is very similar to free market.
• The government does not have any control.
• There are no countries that adopted the pure market economy.
• The main aim or goal of market economy is to make profit.

Command Economy

• Command economy is the next step up from traditional economy. 
• Command economy has a feature that a large part of the economic system is controlled by centralized power, often government. 
• You can see this kind of economic system worldwide.
• The government makes all the decisions or relies to the government to make the decisions.
  

Mixed Economy

• Mixed economy are the partnership of the public owned business and the private owned business.
• It is also defined as a mixture of markets and private ownership.
• It is just the combination or combination of economic systems.
• The benefits of mixed economy is that more or less free of government ownership.
• Examples of countries that use Mixed Economy: The United States, Canada, Australia, Japan, etc.

Traditional Economy

• Traditional economy is based on traditions, customs, and beliefs.
• Places that use this economic system are often rural and farm based. Agriculture or agricultural to be more clear.
• A traditional economy is the best way to start because it is the most traditional  and ancient type of economy.
• The advantage of traditional economy is that tradition and customs are preserved and the disadvantage is it will quite take time to develop.

CONCLUSION

"What is the current Economic System of the Philippines?"

The Philippines currently has a mixed economic system. This can be proven by it's current state, wherein the qualities of all the other economic system are combined.[1]

"What do we believe SHOULD be the Economic System of the Philippines so that it may grow and develop faster and more efficiently?"

We believe that the Economic System should stay as it is: Mixed Economy. It allows the citizens enough freedom that they are able to make their own choices, though they are still very much under the control of the government through paying taxes and requirement to follow the laws set by the government. This type of system, to us, is just right since we aren't at liberty too much that rules and regulations no longer exist, yet the government isn't too tight nor strict that every action requires their approval to perform.

Now, if graft and corruption would be kept in control and prevented as much as possible, it's undeniable that we would be much farther in terms of development than we are now. Since we currently have a democratic system, the decision as to who'd handle the finances resides in the people, and as long as the population votes wisely and in accordance to what's best for the country:

Philippines would definitely prosper.

Sources:
www.study.com
blog.udemy.com
http://www.tutor2u.net/economics/gcse/revision_notes/basics_production_distribution_consumption.htm
https://www.marxists.org/archive/marx/works/1859/critique-pol-economy/appx1.htm
http://www.neda.gov.ph/
http://globaledge.msu.edu/countries/philippines

In order for you to learn more about Economics while having fun, we recommend that you visit these websites and play the following games:

Microeconomics
Miniconomy

By: John Catapang & Harnet Delmo