In the primitive days, man satisfied his hunger by searching for food and living upon what he could raise. As an aid in this search for food, primitive people invented weapons and tools. The procuring of fruits, berries, greens and seeds was supplemented by some hunting.
In places where animals were abundant, the technique of hunting became highly developed. The hunting peoples did not go separately but rather lived in small groups and moved in a group to hunt.
Man moved forward again and he learned to domesticate animals, particularly the big animals such as cattle. Most of the hunting people had already domesticated the dog which aided in the hunt and also helped somewhat in transportation.
The domestication of animals became a group responsibility. In order to secure pasturage, the people followed their animals in flocks and herbs. Group organization around the mother and children, the centre shifted to the flocks and herds, women were subordinated, and men came into a larger dominance.
The development of agriculture came next. When men turned to hoe-culture, he invented new tools which supplemented hoe-culture by crude field culture in a relatively larger scale. With the rise of agriculture men passed from the flesh diet of nomadic to a large use of vegetable foods.
The roaming life of the hunting and pastoral stage gave way to the more settled life of agriculture. With the stable life of agriculture there seem to have been associated other inventions. Pottery making, the weaving of hair or wool or cotton are more often found among agricultural groups. With the cultivation of the soil, population multiplied.
Agriculture made fixed abodes necessary, and led to the establishment of village communities. The making of money became an occupation which besides adding to human welfare also created an unlimited amount of human ill will and misery.
Down to the middle of the eighteenth century, agriculture was the leading occupational activity of mankind. With the Industrial Revolution and with the manufacture of tools on a large scale, there developed a new type of agriculture. The division of land into farms under independent ownership became common. The increase in population inaugurated the era of scientific agriculture of the twentieth century. Labour system came into vogue.
The use of the factory system in the later part of the eighteenth century and in the early nineteenth century gave birth to capitalism. The application of steam as a motive force in operating machinery revolutionized industry.
Power driven machinery supplanted the hand driven tools. Due to the loss of personal contact between the employer and the labour on account of the large-size of the factory: labour-capital disputes became intensified. Labour organized itself for its protection: capital likewise began to organize for its advancement.
The twentieth century has brought about mass production, rise of many near-monopolies and a high degree of division of labour. Now, market situation has been profoundly altered.
The consumer has become more and more dependent upon the institutions of the market place. Advertising profoundly influences consumers’ wants and habits of buying. A product is associated with a popular film star so that it may appeal the people. The nature of retailing has changed.
The above description of economic development gives an idea of the differences between the economic systems of simple (ancient) and complex (modern) societies. Briefly put these differences are:
(i) Undifferentiated patterns of economic activity;
(ii) Integrated system of living;
(iii) Production need oriented and not for marketing;
(iv) Informal structure of economic relations;
(v) Absence of large specialized groups and collective bargaining;
(vi) Primary techniques of control;
(vii) Barter system of exchange;
(viii) No separation between ownership and management;
(ix) Non-existence of monetary and credit system.