A traditional economy is fueled by the agriculture of whatever region it is in. It is a form of economy that is shaped largely by the areas traditions and culture and often utilizes the idea of bartering rather than currency exchanges. It is most common in developing nations with emerging marketplaces. Many people criticize that the people in these economies are living in poverty, but looks can easily deceive. By exploring the pros and cons associated with traditional economies you can gain a better understanding of why they are so widely used.
The Pros of a Traditional Economy
Less Destructive
Century long traditions are often at the root of these economies. The goods are not as much “produced” as they are harvested. This causes much less impact on the environment and allows the markets to be completely self sustaining.
Strong Sense Of Community
Each person has a vital role in these economies, producing very tight knit and close groups of people. They have to support on each other, selfishness is very rare as well as greed.
Vital Needs Met
While the lifestyles of the people living in these economies may not be glamorous in the normal ways that we are used to, they do work. All of the basic necessities of life are provided, by themselves. Along with living a wholesome life, they often take much pride in the work that they do and the places that they live.
The Cons of a Traditional Economy
No Change
The traditions are so deeply rooted in these economies that they strongly resist any form of change or growth. This hinders the growth of their nation and the world.
Lower Standard Of Living
Because they people are only really concerned with the basic necessities of life, they live a very basic, and often somewhat impoverished lifestyle. This is bad for the children specifically. Their education and health are risked.
Unpredictable Problems
Things like weather, natural disaster, and bad crops all impact the society deeply. People often starve, production drops dramatically, and sickness runs rampant through these societies.
How Do You Feel about a Traditional Economy?
Not many areas of the developed world operate underneath a traditional economy, however small pockets of these types of market exist all over the world. Many factors come into play, the strongest of which is history and tradition. Educating yourself of the effects of this type of economy can greatly help you to understand where you stand.
