Economy

An economy is a system of making and trading things of value. It is usually divided into goods (materials and objects) and services (things people do). An economy assumes that there is a medium of exchange, which, in the modern world, is called 'finance'. This makes trade possible. The alternative – systems of barter – exist only on a very small scale.

To better understand how the economy works, it can be discussed in three sections:

• The primary sector which covers raw products from farming, fishing, and mining, and so on.
• The secondary sector which covers manufacturing of goods.
• The tertiary sector which covers a range of services, provided to people and companies.

The term 'real economy' is sometimes used to mean the part of the economy concerned with goods and services. This is contrasted with the 'paper economy', the financial side of the economy, which buys and sells on the financial markets.

The word 'economy' comes from the Greek word 'οἰκονόμος'. This means 'person who manages the house'.

Related pages

• Economics
• Political economy