Saturday, January 2, 2016

Dissect the Economy into 10 Elements

   Dissect an economy to its basic elements, and you will find at its heart, the provider of a product or service. Other elements of the economy lean on the provider. If you have a car, someone comes along to sell components for it. Someone comes along to market it, either by advertising or by distributing it. Someone comes along to tax it. Someone comes along to regulate it. Someone comes along to buy it. Someone comes along to fix it or service it when it breaks down. And, finally, someone comes along to either re-market it or dispose of it when the initial buyer no longer wants it.
   The inventor, of course, is a special provider of the product. If the producer of the product is the basic element, the inventor is the basic part of that basic part.
   Studied this way, then, we have at least ten components of an economy, each worthy of being studied as to how it fits into and impacts the economy.

  1. The inventor.
  2. The producer. The person who provides the product.
  3. The producer of a product that becomes a component of a more major  product. It should be noted, this occurs in the pre-market phase.
  4. Those who inject themselves into the flow of money from the product, and draw off a portion of it, such as the taxers. These people usually do not, and perhaps never, contribute to the making or marketing of the product. They profit off the product without adding to its value.
  5. Those who impact the product and/or its sales, usually without an exchange of money between them and the product's maker, such as government regulators, industry monitors, and public citizens with their consumer pressures.
  6. Those who advertise and promote the product.
  7. Those who distribute the product. These can sometimes be the same people who promote it, but can also be separate from them.
  8. The buyer.
  9. Those who service the product after its sale. These aftermarket people do things like oiling the car, repairing it, giving it a new paint job, etc. 
  10. Those who take the product off your hands once it has served its usefulness, whether they be reselling it or disposing of it.


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