ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -Traditional economies are those in which customs and traditions are more important than money. Traditional economies are often based on hunting, fishing and gathering or farming. Often in a traditional economy, there is no surplus and no resources, and bartering is used to exchange for needed goods.

Detailed explanation-2: -A traditional economy is a system that relies on customs, history, and time-honored believes. Tradition guides economic decisions such as production and distribution. Societies with traditional economies depend on agriculture, fishing, hunting, gathering, or some combination of them.

Detailed explanation-3: -Each economy functions based on a unique set of conditions and assumptions. Economic systems can be categorized into four main types: traditional economies, command economies, mixed economies, and market economies.

Detailed explanation-4: -Examples of traditional economies include the central African Mbuti, the Australian Aborigines, and the Inuit of Northern Canada. The main advantage of a traditional economy is that the answers to WHAT, HOW, and FOR WHOM to produce are determined by customs and tradition.

Detailed explanation-5: -Traditional economies have several characteristics that are unique compared to modern economies. They are geographically and locally based, they have a bartering system, they have little to no surplus or goods, and they don’t waste any parts of goods they produce.