Economic structure has been extensively studied from various perspectives. Researchers have studied economic structure from a variety of angles such as theories of exchange, econometrics, and case studies.
In the beginning, human societies were primarily concerned with exchanges. As societies grew more complex, they added other methods to satisfy their needs and wants–such as working. These new ways of life reorganized society’s resources, and impacted its economy. Emile Durkheim described this transformation from “mechanical” solidarity, rooted in the division of labor, to what he called “organic” solidarity–associating people with similar interests and skills. Today, trade and the economy continue to hold societies together.
A flexible economy balances the flow of resources, transferring them to industries with high demand and low production costs. This also allows businesses to expand and fail, and the market eliminates the inefficient ones. The economic value is passed on to the employees through the wages increase and savings. This boosts the power of purchasing. In turn, consumers spend more and invest more–creating a positive cycle that creates economic growth.
However, the speed and severity of structural changes varies across countries and over time. Our understanding of how norms, culture laws, institutions, and norms influence freedom and prosperity isn’t fully understood. The papers in this volume, both theoretical and econometric–help to fill the gaps.
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