Quarter2 Module 1

ECONOMIC
INSTITUTIONS
 Economic Institution
Education is the social institution that formally
socializes members of the society. It also refers
to the process through which skills, knowledge,
and values are transmitted from the teachers to
the learners
TYPES ODLF ECONOMIC
INSTITUTIONS

Nonmarket Institutions

Market Institutions

Kian Sorela
 Nonmarket
Institutions
Reciprocity - exists when there is an
exchange of goods or labor between
individuals in a community. This would r
Warren Opia
include direct barter or simultaneous
exchanges of goods or labor. An example
of reciprocity is when you exchange food
or in-kind for the labor extended from
your neighbors.
Laurence Agu
ilar
 TRANSFER
entails a redistribution of income that is not
matched by the actual exchange of goods or services.
An example of this is a donation or financial
assistance from a wealthy relative to the needy one.
Another is from the government institutions in the
case of 4P's, senior citizen social pension, farmer
subsidies, social security benefits, among others.
 REDISTRIBUTION
can be considered as a combination of transfer and
reciprocity. It involves a centralized collection of
goods from members of a group and redistributes
the goods to the same members of the group. For
example, during this covid-19 pandemic, a student
organization in your school collects relief goods and
distributes the same to the most affected students
in the community.
 Market Institutions
The market transaction
Tertiary education is offered by private and
public colleges and universities. Most higher
education institutioinvolves parties who sell their
goods and services in exchange for cash from
consumers or customers. Some examples of
these are the sari-sari stores in our community
where we use to buy our basic needs; the food
industry that we used to patronize provides
support to the economic activity in our country, in
general.ns offer 4-year degree programs with
two semesters per year.
Market and state.
The state, through the government, plays an
important role in the market. The government
regulates the prices especially for the basic
commodity to protect the interest of the
consumers. That is why we have this socalled
Suggested Retail Price (SRP) which means that
the price of a certain commodity follows a
price ceiling or the maximum price set by the
government. The Department of Trade and
Industry (DTI) is tasked with this regulation.
 Market Institutions

LABOR
Labor is also considered a commodity and it is an
inp ut to the prod uc tion of goods and services. The
government regulates the prices of labor by
determining the minimum wages through the
regional wage board to protect the workers from
being paid below the minimum in exchange for
their service rendered. The government
intervenes in the activities of market institutions
to primarily protect the interest and welfare of
the consumers and the workers.
 Non-state Institutions and Organizations
BANK - is a place where people deposit or save their money with interest
in a given period. It lends money both to public and private
organizations. The government borrows money from the bank to
finance its projects while private organizations and individuals borrow
money to finance their business and other personal needs. The example
includes Banco de Oro, Bank of the Philippine Islands, Metrobank, rural
banks, etc.
Corporation - is a company or group of people authorized
to act as a single entity and recognized as such in law.
Usually, corporations operate as stock corporations
where ownership is through stockholders who own
shares in the company. Examples are San Miguel
Corporation and Jollibee Foods Corporation.

Coorperative - or coop refers to an autonomous association

whose membership is voluntary toward the attainment of
shared economic, social and, cultural needs or aspirations. The
members are the owner of a cooperative.
 trade union or labor union
A trade union or labor union is an organization of
workers whose main objective is to protect the welfare
of its members. Its purpose is to collectively negotiate
with employers for better compensation benefits, to
ensure safety standards in the workplace, and others.
In the Philippines, these national federations are the
Trade Union Congress of the Philippines (TUCP) and the
Kilusang Mayo Uno (KMU).
 Transnational Advocacy Groups
Transnational Advocacy Groups are involved in social
advocacy to promote principled causes, ideas, and
values. Their goal is to give the powerless a voice in the
domestic and international law-making body. Common
social advocacies include human rights, consumer rights,
women’s rights, environmental issues, and international
peace. In the Philippines, Human Rights Watch is very
active in human rights and peace issues.
 Transnational Advocacy Groups
Development Agencies are committed and dedicated to distributing
aid. These agencies are present in developing countries challenged
by security conflict, food shortage, climate change, financial
instability, and others. Some of the prominent development agencies
in the Philippines are the following:
• United States Agency for International Development (USAID)
• Australian Agency for International Development (AusAID)
• Japan International Cooperation Agency (JICA)
 Global Organizations
Global Organizations work in the development of entire countries. They are
the funders and donors. They operate by giving loans or grants to other
countries to be used for improvement. In the onslaught of COVID-19, World
Bank granted a loan to the Philippines to be used for financial assistance to
many of the Filipinos who are affected by the pandemic. Below are the
most well-known organizations in the world.
• World Bank (WB)
• International Monetary Fund (IMF)
• Asian Development Bank (ADB)
 The International Organizations
The International Organizations are organizations with a worldwide
membership, scope, or presence. The two (2) main types are the following:
• International Non-governmental Organizations (INGO) are non-
governmental organizations (NGOs) that operate internationally, for
example, the International Committee of the Red Cross.
• International Governmental Organizations (IGOs) are organizations that
are made up primarily of member states, for example, the United Nations
(UN).
Thanks!