Society plays a role as the agent of economy, either domestic society or foreign society.
Domestic Society as the Agent of Economy
Society consist of families. Therefore, economic activity run by society is not different with economic activity run by a family household.
To fulfill its necessities, society needs goods service. Those are the basic requirements such as rice and sugar, houses worship, means if transportation, consolation, and education. All the members of society earn some money to fulfill their necessities by working. The members of society supplies also factors of production for the process of production. For examples, working in a company, saving money in a bank, an renting a tractor to some farmers.
Foreign Society as the Agent of Economy
Society’s economic activity is not only run by domestic society, but also run by foreign society.
The causal factors of the involvement of foreign society in economic activity is elaborated as follows.
- There are no countries can stand alone in the world. Each country brings its peculiarity of the country’s product. The country products is different from other country’s products.
- In the globalization era society’s view has turned from national perspective into global or international perspective.
What are the roles of foreign society in economic activity? The roles of foreign society are follows.
- As a consumer of goods exported by our country. For example, mostly, the Dutch citizens utilize Jepara furniture.
- As a producer of goods imported by our country. For example: internet that is made in Japan is only used by Indonesian.
- As a consumer of service exported by our country. For example, Malaysian utilizes Indonesian blue-collar workers.
- As a producer of services imported by our country. For example, an Indonesia company utilizes Germany’s experts.
- As supplier of capital needed by our country. For example, Indonesia increases loan capital from Japan government.
In brief, it can be concluded that the role that foreign society plays in economic activity is as a producer of goods an services exported by our country. In addition, foreign society’s role is as a consumer of goods and services exported by our country. In other words, foreign society plays roles as the sellers and buyers.