Modern production and market relations
Production is the process of creating material and spiritual goods to meet people’s needs. It repeats continuously as a chain of production, distribution, exchange and consumption. Production has two factors: the means of production (instruments and objects of labour) and the labour force. The development of production is seen in three stages: a move from simple tools to more complex ones; production based on machines, mechanisms and machine tools and the appearance of the commodity market; growth of the service sector, science becoming a productive force and a move to resource-saving high technologies. The market is the place where seller and buyer meet and the relations between them. The market links production with consumption: an item becomes a commodity, and once it is sold the labour spent on it turns into money, with which new raw material and equipment are bought and production is renewed. Competition favours the producer who is stronger in quality, design and price; in the school workshop too, a student’s item comes closer to market demand if it meets quality and design requirements.
Market model: the class has a “workshop” group and a “buyers” group. The workshop makes a small paper item (copy) and sets a price; buyers buy it with play money. At the end discuss why a certain item sold more.