In order to function in society, people should eat, drink and shoed, dress and live in an apartment or a house, etc.And as in a pure form does not exist, then people have to produce it.And everyday level it appears that the economy and production - the same thing.
But in the primitive, slave or feudal society such thing as "the economy" does not exist.Production time was based on non-economic methods of coercion and violence.And the result becomes the main purpose of which is not dependent on the magnitude of the cost.
Economic activity is not possible without production.Members must adhere to the principle of the production of general economic expediency.In the context of such a relationship the economy is taking place.Thus, it must be linked to results and costs incurred.
ratio expresses the efficiency of these indicators.Economic activity should reflect the impact of the production of the entire society.And since then the production base - it is meeting the needs of citizens, the efficiency of the resulting product expresses general economic result.
Classification of Economic Activities (the Russian Classification NACE) carried out according to certain criteria.They characterize certain activities, technologies and manufacturing processes.
Effective economic activity - a condition in which most fully satisfied the needs of the population.The degree of satisfaction of the needs of the citizen can not be increased due to the deterioration of the situation of the other.This is called "Pareto efficiency" after the Italian economist.Performance - is the most important category of the economy.
There are 4 stages of economic activity.
1) Reproduction.This constantly repeated process of production.It can be extended or simple.When the last volume of output did not grow as well in the first - on the contrary.In today's society dominated, of course, enhanced.
2) distribution.It is a distribution of the resulting production of goods among members of society.Also, this stage involves the distribution of members of society and the means of production by industries and areas, economic enterprises and regions, sites and work shops.In this case, this step is an element production.
3) Exchange.Independent feature is a movement of the product.In the production - the exchange of skills and activities.
4) consumption.The final stage of movement of the product, as a result of which satisfy human needs.It includes private consumption, which ensures the reproduction of the labor force, and create incentives to improve production and further development.Furthermore, there may be industrial consumption at which the consumption of materials in the process of creating products.
Thus, the economic activity takes place alternately through production to its distribution, exchange, and then - to consume.
