5.2 What Is an Economy?

An economy is a system for the production, distribution, and consumption of the goods and services within a society. That sounds like a bit of a mouthful. Let’s take an example.

Imagine again that you’re still in that coffee shop we mentioned at the beginning of this chapter. It is pretty remarkable to consider how many people’s work went into your experience. For one thing, people had to grow that coffee, and harvest it, process it, roast it, ship it, grind it, and brew it. All along that line of production, other people had to contribute too, manufacturing tractors, roasting equipment, shipping containers, and ships. Some folks had to drill for oil, while others refined it. Others logged the forests that ended up in the napkin on your table. That entire complex web of relationships forms the economic system.

Since most people in the world live in a capitalist economy, most of the people doing that labor are wage workers—employees of various businesses. Each of those companies are competing to make profits for the owners of the businesses—the central goal of all capitalist enterprises.

Consider for a moment the number of social issues entangled within these economic relationships. Any list would have to include the wages and working conditions of all the people from seed to espresso. It would surely include the environmental impacts of coffee plantations, global shipping, and mass consumerism. It might even entail questions of corporate power and its effects on democracy.

The economy, in short, is entangled with nearly every social issue we face.