Our economy
Many different stakeholders play a role in our economy. People have different needs. They need nutritious food or may want to get from one place to another quickly. Others may need to heat their flat or would like to meet up with their friends, for example. To satisfy these needs, different products or services (goods) are necessary or at least useful.
Nobody can produce all of these goods themselves. It is characteristic of our economic system that companies produce and sell many of these goods. The market is the place where the supply of certain goods and demand for these goods intersect and where prices are determined.
The economy briefly explained: How does our economy work?
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In addition to the corporate sector (companies) and the household sector (private individuals), the state is the third key stakeholder involved in the economic cycle. The state is financed through taxes paid by companies and private individuals. It contributes to the economy in important ways: It generates demand for certain products and services as well as a legal framework for our economy; and it provides households and companies with a large variety of public goods, such as infrastructure, education, public safety and financial support.
Individuals may have various roles in the economy. If you are hungry and buy lunch, you are acting as a consumer. If you buy raw materials for your company, you are acting as an entrepreneur.
