Middle Eastern Economies

Economic Systems Pure Command Pure Market

Israel (1) What to produce? A large portion of Israel’s GDP comes from high tech manufacturing, financial services, and agriculture.

(2) How to produce? Israel has substantial government ownership of business, but is gradually privatizing companies.

(3) For whom to produce? The private sector produces goods and services for domestic and international markets based on the market price system.

100 Economic Systems Israel 68% Place on the continuum: Israel would fall in the middle of the market side on the continuum. 100 Pure Command Pure Market

Saudi Arabia (1) What to produce? Saudi Arabia is the world’s leading producer of oil. The Saudi government continues to invest in industrial production. They are a leader in petrochemicals, mining, and refining.

Saudi Arabia (2) How to produce? Over 95% of the oil industry in the country is operated by the government. Most other major industries have significant government involvement. Saudi Arabia relies heavily on specialized labor from other countries. Estimates are that a third of the labor force falls in this category. Since the 1980s, the Saudi government has been trying to increase private ownership of business and encourage more joint ventures with private foreign companies.

Saudi Arabia 3) For whom to produce? One third of Saudi Arabia’s GDP is based on exports to other countries. (This is due to the economy’s reliance on the oil sector.)

100 Economic Systems Saudi Arabia 64% Place on the continuum: Saudi Arabia would fall to the left of Israel on the continuum. 100 Pure Command Pure Market

Turkey (1) What to produce? Turkey has a diversified economy with large service, manufacturing, and agricultural sectors.

(2) How to produce? Since the late 1980s, Turkey has gradually moved from a government directed economy to more private enterprise.

(3) For whom to produce? One fifth of Turkey’s production is exported. The remainder is consumed by domestic consumers and the government.

100 Economic Systems Turkey 62% Pure Pure Market Command Place on the continuum: Turkey would fall to the left of Saudi Arabia and Israel on the market side of the continuum. 100 Pure Command Pure Market

100 Economic Systems Israel 68% Turkey 62% Saudi Arabia 64% 7th Grade- This information is meant to be used in conjunction with the 6th and 7th grade Teacher Notes. For additional resources, go to GeorgiaStandards.org. (Note: This is not an expectation for students to memorize numbers, but to understand that factors that influence specific countries to move more towards a command or market economy). The numbering system is based on The Heritage Foundation’s Economic Freedom Index 2009 The Heritage Foundation is a conservative organization that has partnered with the Wall Street Journal for over a decade to evaluate each country based on a set of 10 criteria to determine economic freedom. Update information using resources listed in the Teacher Notes. 100 Pure Command Pure Market 15