SOCIAL STUDIES LESSON PLAN RESOURCES
SOCIAL STUDIES CLASS
Economics
TOPIC
Relationship Between Political and Economic
Freedom
LESSON 3
Economic Systems
OBJECTIVES
By the end of this lesson, the student will be able to:
 Define economic freedom.
 Describe the indicators of economic freedom.
 Identify United States’ ranking on the Index of Economic Freedom 2014. Explain why the United States is
ranked at that level.
 Describe the four economic systems and the degree to which they provide economic freedom for their
citizens.
 Suggest other indicators of economic freedom and what it means to you.
CLASSROOM SUPPLIES NEEDED
Depending on what content and which activities are provided, some to all of the items below will be needed.
 Whiteboard and dry erase markers or flipchart paper and markers
LESSON RESOURCES
Depending on what content and which activities are provided, some to all of the items below will be needed.
Handouts to Provide Students in Class
 Handout 1 - Pros and Cons of Market Economies
 Handout 2 - The Advantages of a Mixed Economic System
 Handout 3 - Advantages and Disadvantages of Traditional Economies
 Handout 4 - The Advantages & Disadvantages of Command Economies
Online Videos Students Will Watch in Class
n/a
Online Index 2014
 Index of Economic 2014
Website http://www.heritage.org/index/
Pre Work for Students To Read Before Class
n/a
Pre Work for Students To View Before Class
Economics > Relationship Between Political and Economic Freedom > Economic Systems
Page 1
SOCIAL STUDIES LESSON PLAN RESOURCES
SOCIAL STUDIES CLASS
Economics
TOPIC
Relationship Between Political and Economic
Freedom
LESSON 3
Economic Systems
 Online Video 1 - Economic Freedom and A Better Life (3:09 minutes)
Website http://www.youtube.com/watch?v=6yqA6-ukmfg
KEY VOCABULARY AND IMPORTANT CONCEPTS
 Economic Freedom
 Market Economy
 Traditional Economy
 Economic System
 Mixed Economy
 Command Economy
STUDENT PRE-WORK FOR THIS LESSON
Directions
1. Check with your students to verify who has access to the internet to watch a brief online video
before the next class. You may need to provide recommendations for use of a public facility like a
library, or provide the hours at your program’s computer lab, if one is available.
2. Provide the online video link listed below, and assign it to be watched before the next class.
3. Tell your students that during the next class, they will be asked to provide their answers to the
question: “How would you define economic freedom?”
Online Video Resource
 Online Video 1 - Economic Freedom and A Better Life (3:09 minutes)
Website http://www.youtube.com/watch?v=6yqA6-ukmfg
Class Preparation
Be prepared to answer the question: “How would you define economic freedom?”
Economics > Relationship Between Political and Economic Freedom > Economic Systems
Page 2
SOCIAL STUDIES LESSON PLAN RESOURCES
SOCIAL STUDIES CLASS
Economics
TOPIC
Relationship Between Political and Economic
Freedom
LESSON 3
Economic Systems
ANTICIPATORY SET FOR THE LESSON (5 MINUTES)
Mode
Class Discussion
Topic
The United States and Economic Freedom
Teacher asks students to consider the amount of freedom that citizens in the
United States enjoy. Teacher asks students to name some of the freedoms that
we enjoy as American citizens.
Students may describe freedoms listed in the Bill of Rights.
Teacher tells students the Heritage Foundation has developed four broad
indicators of economic freedom, and has compiled a list of countries and
ranked them based on the indicators. (Index of Economic Freedom 2014)
The indicators include: rule of law, limited government, regulatory efficiency,
and open markets.
Teacher provides a list of fifteen countries. The United States is included on the
list.
Teacher asks students to speculate on where the United States ranks among
the countries listed, based on the four broad categories outlined by the
Heritage Foundation.
Students’ answers will vary.
LESSON CONTENT AND ACTIVITIES: ECONOMIC FREEDOM (20 MINUTES)
Mode
Teacher Shows
List of Countries
Topic
Countries That Have Economic Freedom
Teacher shows list of countries.
Teacher does NOT yet reveal the United States’ rank among these countries.
Teacher Lecture
Class Discussion
What is Economic Freedom?
Teacher provides several definitions of economic freedom.
Economics > Relationship Between Political and Economic Freedom > Economic Systems
Page 3
SOCIAL STUDIES LESSON PLAN RESOURCES
SOCIAL STUDIES CLASS
Economics
TOPIC
Relationship Between Political and Economic
Freedom
LESSON 3
Economic Systems
Teacher asks students if they have any comments, ideas, or thoughts about
the definitions of economic freedom.
Teacher Lecture
Class Discussion
Indicators of Economic Freedom
Teacher lists and describes the four indicators of economic freedom, as
defined by the Heritage Foundation.
Teacher asks students if they have any comments, ideas, or thoughts about
the indicators of economic freedom.
Teacher Lecture
Class Discussion
Where Does The United States Rank?
The teacher reveals the United States’ ranking among the fifteen countries
listed.
The United States ranks 12th on the Index for 2014.
The teacher describes the reasons that the Heritage Foundation ranked the
United States as 12th. Teacher asks students if they have any comments,
ideas, or thoughts on the reasons for the United States being ranked 12th out
of the list of fifteen countries.
Teacher Shows Video
Economic Freedom and A Better Life-Video
Students review Online Video 1 -Economic Freedom and A Better Life (3:09
minutes).
Student Activity
Teacher asks students to identify additional information that video provides.
The video identifies other indicators of economic freedom such as GDP, life
expectancy, and poverty levels.
The video concludes by saying that people fare better on all three indicators
in countries that have a higher level of economic freedom.
LESSON CONTENT AND ACTIVITIES: ECONOMIC SYSTEMS AND ECONOMIC FREEDOM (30 MINUTES)
Mode
Teacher Lecture
Class Discussion
Topic
Economic Freedom and Economic Systems
Teacher defines and identifies the four economic systems.
Economics > Relationship Between Political and Economic Freedom > Economic Systems
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SOCIAL STUDIES LESSON PLAN RESOURCES
SOCIAL STUDIES CLASS
Economics
TOPIC
Relationship Between Political and Economic
Freedom
LESSON 3
Economic Systems
Teacher list the three questions that all economic systems answer.
Teacher Lecture
Class Discussion
Market Economy
Teacher explains how a Market Economy answers the three basic questions:
 What to produce?
 How to produce?
 For whom to produce?
Teacher Lecture
Class Discussion
Mixed Economy
Teacher explains how a Mixed Economy answers the three basic questions.
Teacher Lecture
Class Discussion
Traditional Economy
Teacher explains how a Traditional Economy answers the three basic questions.
Teacher Lecture
Class Discussion
Command Economy
Teacher explains how a Command Economy answers the three basic questions
Teacher Provides
Instructions
Economic Systems and Economic Freedom
Teacher organizes class into four groups.
Teacher assigns each member of the group one of the articles on economic
systems.
Group 1 - Handout 1 - Pros and Cons of Market Economies
Group 2 - Handout 2 - The Advantages of a Mixed Economic System
Group 3 - Handout 3 - Advantages and Disadvantages of Traditional Economies
Group 4 - Handout 4 - The Advantages & Disadvantages of Command
Economies
Student Activity
Teacher gives students the following instructions:
After reading the article, your group will:
Economics > Relationship Between Political and Economic Freedom > Economic Systems
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SOCIAL STUDIES LESSON PLAN RESOURCES
SOCIAL STUDIES CLASS
Economics
TOPIC
Relationship Between Political and Economic
Freedom
LESSON 3
Economic Systems
 Describe the advantages and disadvantages of the economic system.
 Identify the ways that your economic system does or does not promote
economic freedom.
 Your group will make a presentation to the class.
 Students will use the whiteboard and dry erase markers to develop their
presentations.
Students’ presentations should include the following information:
Market economies provide several advantages and disadvantages for
businesses, and for citizens. Businesses decide what they want to produce, how
to produce, and for whom to produce, based on supply and demand. By giving
businesses the freedom to make their own decisions about production choices,
market economies promote economic freedom. Competition from other
businesses, forces them to make the best product possible. Economic freedom
is defined as the freedom to prosper, and market economies are guided by the
profit motive.
There are some disadvantages to the economic system. Without some
government regulations, businesses can eliminate the competition, and form
monopolies. Monopolies can lead to increased prices for goods and services.
If profit is the only motive, then some communities might be underserved in a
market economy.
Mixed economies provide elements of a market economy, and a command
economy. Individuals are free to own property, and operate their businesses
for a profit. These two characteristics promote economic freedom. The mixed
economy provides a safety net for its citizens, which includes Social Security, a
minimum wage law, and healthcare benefits.
While these provisions are viewed as advantages by some in society, they are
not viewed as advantageous by all citizens. The Heritage Foundation cites
provisions such as minimum wage laws, and the healthcare law, as concerns.
In mixed economies, the government imposes a variety of regulations on
businesses. These regulations can be a disadvantageous if they decrease
economic growth. The Heritage Foundation cites the regulations that have
been imposed since 2009, as a reason for the United States being ranked 12th
out of the fifteen countries that we listed.
Traditional economies operate according to the traditions of the past. The
advantages of this system include the fact that citizens have well-defined roles,
feel a sense of support from their community, and everyone has a job.
Economics > Relationship Between Political and Economic Freedom > Economic Systems
Page 6
SOCIAL STUDIES LESSON PLAN RESOURCES
SOCIAL STUDIES CLASS
Economics
TOPIC
Relationship Between Political and Economic
Freedom
LESSON 3
Economic Systems
Food supply is based on demand, and there is no waste of food.
Traditional economies do not change their economic activities. The economy is
based on traditions of the past. This practice can be disadvantageous, because
productivity suffers, due to a lack of technological innovation. Individuals have
a lower standard of living than persons in other countries. Economic freedom
emphasizes the freedom of individuals to choose their occupations, and the
freedom to prosper. Given these definitions, individuals living in traditional
economies might not be viewed as having a high level of economic freedom.
Command economies -the government provides the essentials that society
needs. The government determines what to produce, how to produce, and for
whom to produce. The advantages of this type of system include the fact that
the government is stable, and has the ability to respond quickly to changes
when needed.
The disadvantages include the fact that there is no competition between
businesses, and there is no profit motive. Individuals do not have the incentive
then to innovate and create the best products. Consumers do not have a
variety of choices of goods and services.
Given the fact that economic freedom emphasizes the individual’s freedom to
choose their business, and the freedom to prosper without interference from
the government, command economies do not promote economic freedom to a
high degree.
LESSON ASSESSMENT AND STUDENT LEARNING EVALUATION (15 MINUTES)
Mode
Topic
Reflections on Economic Freedom
Teacher Provides Instructions
Teacher provides the following instructions to students:
 Reflect on what you have learned about economic freedom.

Write your thoughts and ideas about economic freedon on
your own paper.
 This is a silent activity.
 When you are finished you may share your thoughts with the
class and or with other students in the class.
Economics > Relationship Between Political and Economic Freedom > Economic Systems
Page 7
SOCIAL STUDIES LESSON PLAN RESOURCES
SOCIAL STUDIES CLASS
Economics
Chalk Talk Student Activity
TOPIC
Relationship Between Political and Economic
Freedom
LESSON 3
Economic Systems
 Students write their thoughts
Economics > Relationship Between Political and Economic Freedom > Economic Systems
Page 8