The high standard of living most of us enjoy today depends on the ability of the global economy to turn out each day an enormous volume of food, shelter, and other essentials of modern living.
This is an exceedingly complex task because scarce resources must be procured in just the right amounts to provide the raw materials of production and combined at just the right time with labor, management, and capital to generate the products and services demanded by consumers.
In short, any economic system must combine inputs—land and other natural resources, labor and management skill, and capital equipment to produce output goods and services.
The global economy generates a flow of production in return for a flow of payments.