Traditional economics is a type of economicsystems of management. Traditional economy differs from other ways of economy in that in it the practice of using resources is determined by traditions and customs.
For countries whose economies are traditionalcharacter, there is the existence of different forms of economic management, based on different forms of relation to property. Quite often in this way the communal form of ownership is maintained, for which the natural-social form of management is characteristic.
The traditional economy also suggeststhe existence of small private property, which, as a rule, is the foundation for the creation and development of small-scale production (representing which artisans and peasant farms).
Basic decisions in the traditional economycan be taken in different ways. This is influenced by the type of the existing economic order. In a natural-community way of life, the main economic decisions are made by a small group of community members (council of elders) or head of the clan. As for artisans and peasants, they make such decisions on their own.
Traditional economics has different stimulating levers,which spur economic development. The natural-communal way, basically, operates with material incentives in relation to labor relations. They are associated with the need to meet basic life needs.
In conditions of predominance of small-scaleproduction of incentives are economic levers: excess income over expenditure. Of course, given the fact that such an economy is based on the personal labor of the participants, the amount of such incomes is not very large.
Traditional economics is based on backward technology, manual labor, agricultural production. The existence of established traditions limits the expansion of the use of technology and the dissemination of advanced information.
In general, such an economy can be characterizedas an underdeveloped, inactive, stagnant system. Today, there are no countries left in the world that are running the farm in a purely natural way. Virtually every market economy has already penetrated market relations.
At the same time, a rather significant percentageof the world's population lives in the conditions of development of economic relations, which are characterized by the term "sub-economy". First of all, we are talking about third world countries. One of the satellites of such systems is poverty. The existing wealth is concentrated in the hands of a few.
A traditional economy may not even have an official currency and work through barter.
Centralized economy is managedstate bodies, on the basis of directive programs and plans, direct hierarchical subordination to lower-level higher authorities, with state ownership of all means of production.
The Modern Economy of Russia is closely related to the processthe emergence of new conditions for economic management, the transition from a centralized economy to a market economy. Before the reforms in Russia, state property accounted for about 90% of production assets and about 80% of those employed in the economy.
Bureaucratization and monopoly, state regulation of pricesled to a decrease in economic incentives for work and generally hampered technological progress. This led to reforms in the 1990s, during which state ownership gradually began to move into private hands.
By now, Russia's economy hassuch transformations as the overcoming of the nationalization of the economy, there are competitive relations in the market, the infrastructure of the market is undergoing intensive development.
