Subsistence Economy

Definition

A subsistence economy is an economic system in which a community or society relies on local resources and production to meet its basic needs, rather than participating in a broader market-based economy. It is characterized by self-sufficiency, where people produce what they need to survive and consume what they produce.

5 Must Know Facts For Your Next Test

1. Subsistence economies are often associated with pre-industrial, traditional societies that have limited access to external markets and resources.
2. In a subsistence economy, the primary goal is to produce enough to meet the basic needs of the community, rather than to generate surplus for trade or profit.
3. Subsistence economies typically have a high degree of self-reliance and local resource utilization, with little or no dependence on external trade or imports.
4. The mode of subsistence in a subsistence economy is often closely tied to the local environment and available natural resources, such as the presence of wild game, arable land, or access to water.
5. Subsistence economies are generally characterized by a simple division of labor, with most members of the community participating in the production of food and other basic necessities.

Review Questions

• Explain how the concept of a subsistence economy relates to the mode of subsistence known as gathering and hunting.
  • In a subsistence economy, the mode of subsistence known as gathering and hunting is a common way for people to meet their basic needs. Gathering and hunting involves the collection of wild plants, fruits, and the hunting of animals to obtain food and other resources. This self-reliant approach to obtaining resources is a defining characteristic of a subsistence economy, where the community or society relies on local resources and production, rather than participating in a broader market-based economy.
• Describe how the concept of a subsistence economy differs from a market-based economy, and how this difference is reflected in the mode of subsistence.
  • A key distinction between a subsistence economy and a market-based economy is the primary goal of economic activity. In a subsistence economy, the goal is to produce enough to meet the basic needs of the community, rather than to generate surplus for trade or profit. This is reflected in the mode of subsistence, which is often focused on local resource utilization and self-reliance, rather than the production of goods for sale in a broader market. In contrast, a market-based economy is characterized by the production of goods and services for exchange, with the goal of generating profit and participating in a larger, interconnected economic system.
• Analyze how the environmental and cultural context of a society can influence the development of a subsistence economy and the associated mode of subsistence.
  • The environmental and cultural context of a society can have a significant influence on the development of a subsistence economy and the associated mode of subsistence. The availability of natural resources, such as arable land, wild game, or access to water, can shape the mode of subsistence, whether it is gathering and hunting, horticulture, or pastoralism. Additionally, the cultural traditions and values of a society can also play a role in determining the mode of subsistence, as communities may prioritize self-reliance, sustainability, and the preservation of traditional ways of life over participation in a broader, market-based economy. The interplay between the environment, culture, and the mode of subsistence is a key factor in the development and persistence of a subsistence economy.

Related terms

Gathering and Hunting: A mode of subsistence where people collect wild plants, fruits, and hunt animals to meet their food and resource needs.

Horticulture: A mode of subsistence involving the cultivation of small-scale, labor-intensive agriculture, often using simple tools and techniques.

Pastoralism: A mode of subsistence where people raise and herd domesticated animals, such as sheep, goats, or cattle, to meet their food and resource needs.