Question

Do you think an economic system can exist without manufacturing of goods? Explain.

Answer 1

Economic system is a system which involves production and distribution of goods or service along with resource allocation in a society. Various agencies or groups are involved in smooth working of the economic system.

Economic system helps to answer below queries:

• What to produce?
• How to produce?
• Quantity to produce?
• Who is the end user?

Economic system can exist without manufacturing of goods. Manufacturing answers the "How to produce" part of system. If there is no manufacturing, goods can be imported from other country and used. There are many countries in which manufacturing are very limited but still economic system exists. Example: Dubai is very little manufacturing capacity but has high consumption. It relies on import of material from other countries.

So, it is not must to have the manufacturing of goods for the economic system to exist.