While there are types of Economy, Economic Systems and Schools of Economic Thought. For starters, I would concentrate on types of Economy in the post, and to be precise economy I find more relevant to understand monetary systems.
1. Monetary Economics: This branch of economics studies theories of money and provides a framework for analysing money.
It also helps define functions of money like a medium of exchange, a store of value, and a unit of account. It examines monetary systems, including the regulation of money and financial institutions.
The monetary economy includes all financial transactions, markets, and systems (e.g., banking, investments, stock markets)
They are often measured by indicators like Money Supply(M0, M1, M2, M3), Interest Rates, Inflation rate, Exchange rates, and Velocity of Money, to name a few. Full list here
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| Monetary Economy |
2. Real Economy: Real Economy focuses on physical and labour-based activities that create value- paid jobs, caring, volunteering, even cooking at home. It doesn't matter if it includes money or not; it is more about production, purchase, and the flow of goods and services.
To measure the real economy, we use indicators such as GDP, Industrial Production Index, Employment Metrics (Employment/unemployment rate), Household Final Consumption Expenditure, and Proxy Metrics/Variables (Time-use survey, Community Hours). Full List here
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| Real Economy |
3. Sustainable Economy: Sustainable Economy concerns the long-term Economic Growth without negatively impacting the climate, biodiversity, and resource availability for future generations. The Famous indicators to measure it are the Carbon Footprint, Genuine Progress Indicator and Red List Index, to name a few. Key Indicators to Measure the Sustainable Economy
