Week 14 · Chapter

Chapter 14 — Social Institutions: Economy, Work & Politics

Introduction to Sociology Free sample edition

The module's primary reading · ~35–45 minutes · Objective 7 (explain the major social institutions — family, education, religion, the economy and work, and government and politics — through the functionalist, conflict, and interactionist perspectives, including Weber's types of authority and the pluralist and power-elite models), building on Objective 5 (analyze social stratification, class, and global inequality — caste and class systems, income versus wealth, poverty measures, social mobility, the Davis-Moore thesis against the conflict view, and modernization against dependency and world-systems perspectives — reading income, poverty, and cross-national inequality data with their sources and years) and Objective 2 (describe and evaluate the major sociological research methods (surveys, experiments, field research and ethnography, secondary-data analysis), distinguish reliability from validity and a population from a sample, and read a social statistic critically — what it measures, over what population and period, what it shows and does not, and whether it is a correlation or a cause) · Read it first this week; the lecture, the slide deck, the tutorial, the quiz, and the Sociology in Action Workshop all build on it.

In plain language

Most of your waking hours go to two things this week is about: work, and the rules that someone else made. This chapter treats the economy (the way a society produces, shares out, and uses up goods and services) as an institution, as real as the family or the school. You will compare two ways of owning the work, look at how jobs are changing, and ask why people obey some kinds of authority (power people accept as rightful) and not others. Then you will read real Bureau of Labor Statistics figures on how many workers belong to a union, and learn why that figure is a rate of workers and not of people.

Why you already care about this

In its Union Members release, the Bureau of Labor Statistics reported that 10.0% of wage and salary workers in the United States were union members in 2025. That was 14.7 million people. In 1983, the first year with comparable data, the rate was 20.1%, and there were 17.7 million members.

You do not need a government report to feel the economy and the state in your own week. Maybe you picked up a shift through an app instead of a schedule posted on a break-room wall. Maybe a relative works for the county and talks about the union contract at dinner. Maybe you got a parking ticket, and you paid it, even though you did not agree with it.

Each of those moments in your week sits where work, ownership, and power meet. This chapter gives you the words for what you see there, and the habits to read a labor figure without turning it into a verdict.

By the end of this chapter you will be able to:

sort a described job into the primary, secondary, or tertiary sector, and explain what a post-industrial economy is;
state the case for and against capitalism and socialism at full strength, and explain why actual economies are mixed;
tell an employee from an independent contractor, and apply Marx's four parts of alienation to a described job;
tell power from authority, and sort a described leader into Weber's traditional, charismatic, or rational-legal type;
define the state, government, four forms of government, and political participation;
state the pluralist model and the power-elite model without declaring a winner;
read the 2025 and 1983 union figures four ways, with the arithmetic shown.

Carry this line with you: ask whose rate it is — workers, not everyone.

Where we are

Already covered: Week 1 gave you the three perspectives, the macro and micro levels, and Marx's idea of alienation. Week 2 taught the four data questions and the percentage point. Week 5 named Weber's ideal type of bureaucracy, and Week 7 set Marx's two classes beside Weber's class, status, and party. Week 12 named the social institution, and Week 13 read the school and the congregation through the three lenses.
This week: the economy as an institution, the changing nature of work, power and authority, the state and how people take part in it, two models of who holds power, and how to read union membership figures.
How they connect: Week 7's question of who owns what returns as capitalism versus socialism; Week 1's alienation gets a full workout on a modern job; Week 5's bureaucracy becomes Weber's rational-legal authority.
Where we're going next: this week closes the unit on social institutions. Week 15, Population, Urbanization & Social Change, turns to how populations grow, how cities form, and how a society changes.

Week 2 is the chapter this one leans on most. There you learned to ask four questions of any figure: what is measured, over whom and when, what it shows and does not, and whether it is a correlation or a cause. Section 8 runs the union figures through all four. Week 1's rate matters too: a count divided by a population, with the base named. This week the base is not people in general but wage and salary workers, and that one word changes the reading.

1. Follow the coffee: the economy's three sectors

Think about a cup of coffee you bought this week. Before it reached your hand, someone grew the beans, someone roasted and packed them, and someone poured the cup and took your payment. Three kinds of work, in three different places, went into one drink.

That chain is a small picture of an institution you use every day.

The economy is the social institution that organizes how a society produces, distributes, and consumes goods and services.

Sociologists sort economic activity into three sectors.

The primary sector is the part of an economy that draws raw materials from nature, such as farming, fishing, forestry, and mining.
The secondary sector is the part of an economy that turns raw materials into manufactured goods, such as a factory or a processing plant.
The tertiary sector is the part of an economy that provides services rather than goods, such as retail, health care, teaching, and delivery.

Worked example — one cup, three sectors. Follow an illustrative supply chain from the field to the counter.

A coffee farm picks and dries the beans. Drawing a raw material from nature: the primary sector.
A roasting plant roasts, grinds, and bags the beans. Turning a raw material into a manufactured good: the secondary sector.
A café pours your cup and a delivery rider brings a bag of beans to an office. Providing a service: the tertiary sector.

In words: sort the activity by what it does to the product. Taking it from nature is primary, making it into a good is secondary, and serving it to someone is tertiary.

Over time, the balance among the three sectors shifts. A society that once put most of its workers on farms, and later in factories, can come to put most of them in offices, stores, clinics, and warehouses.

A post-industrial economy is an economy in which services, rather than farming or manufacturing, employ most workers.

Misconception check — "a company belongs to one sector." Students often sort a business by its name: "a coffee company is food, so it is primary." It is tempting, because we think of companies as single things. But one company can farm beans, run a roasting plant, and own cafés, so it works in all three sectors at once. The cure: sort the activity, not the company.

Memory hook: take it, make it, serve it.

2. Compare two systems: capitalism, socialism, and the mixed economy

Picture two illustrative bakeries on the same street. The first is owned by one family; they set the prices, keep the profit, and decide whether to open a second shop. The second is owned by the people who work in it, who vote on the prices and share what is left at the end of the year. The bread may taste the same. The question of who owns the ovens is different.

That question, at the scale of a whole society, separates two economic systems.

Capitalism is an economic system built on private ownership of productive property and production for profit.
Socialism is an economic system built on collective or state ownership of productive property, with production aimed at shared needs.

This is contested ground, so you state each side at full strength before you weigh it.

The case for and against capitalism. Its defenders say private ownership rewards effort and risk, and that competition for profit spreads new products and lowers prices. Its critics say it concentrates ownership in a few hands and leaves needs unmet whenever meeting them does not pay.

The case for and against socialism. Its defenders say shared ownership aims production at what everyone needs, such as housing and health care, rather than at what earns the most. Its critics say central control can weaken the incentive to work and invent, and can gather a great deal of power in the state.

Week 7's two classes help here. Marx's bourgeoisie are the owners of productive property, which capitalism places in private hands; socialism, in its pure form, would take that ownership away from any one class.

Both systems, stated this way, are classroom models. No actual economy matches either one.

A mixed economy is an economy that combines private ownership and markets with public ownership, regulation, and shared programs; actual economies, the United States included, are mixed.

Worked example — sorting four illustrative arrangements. Say which system each feature leans toward.

A privately owned phone company that sets its own prices to earn a profit. Private ownership and production for profit: capitalist.
A city-owned water utility that charges everyone the same rate. Public ownership aimed at a shared need: socialist in form.
A food-safety law that every private restaurant must follow. Private ownership under public regulation: a feature of a mixed economy.
A country that has all three of the features above. A mixed economy, which is what you find when you look at real economies.

In words: you sort features, not countries. A real economy is a mix, and the useful question is how much of each it contains.

Misconception check — "capitalism and socialism are two kinds of real countries." Students often treat the two words as labels for two camps of nations. It is tempting, because politicians use them that way. But the pure types are models, and every actual economy mixes private and public ownership. The cure: describe the mix, then ask which way it leans.

Memory hook: who owns the ovens — and how much of each?

3. Watch work change: automation, gigs, and contracts

Think about the last time you ordered food on a phone. A screen took your order, software picked a route, and a driver you had never met brought the bag. Several parts of that work used to be done by people in a building: a cashier, a dispatcher, a delivery crew with a set schedule.

Two changes you have probably seen are at work there.

Automation is the use of machines and software to do tasks that people once did.
The gig economy is work arranged as short, separate tasks or jobs, often assigned through an app and paid by the task rather than by the hour or the year.

The gig economy raises a question about status: who, exactly, is the worker working for?

An employee is a worker who works under an employer's direction and is paid wages or a salary on the employer's payroll.
An independent contractor is a self-employed worker who sells a service under a contract, usually setting their own hours and supplying their own tools, and who is not on the buyer's payroll.

Worked example — two drivers, the same bags. In an illustrative city, two drivers carry grocery bags to the same apartment building on the same evening.

Driver one is on a grocery chain's payroll, drives a company van, and works a shift the store sets. Under an employer's direction and on its payroll: an employee.
Driver two signs up through an app, uses their own car, picks which orders to accept, and is paid per delivery under a contract. Self-employed and selling a service under a contract: an independent contractor.
What differs. The bags, the building, and the stairs are the same. The arrangement is different: who sets the hours, who supplies the tools, and whose payroll the driver is on.

In words: the task does not tell you the status. The arrangement does.

Honesty note: where the legal line between an employee and an independent contractor falls is argued over in courts and legislatures. This course teaches the two categories and does not ask you to settle that argument.

Misconception check — "same task, same status." Students often assume two people doing the same job must have the same kind of job. It is tempting, because the work looks identical from the doorstep. But status comes from the arrangement, payroll or contract, not from the task. The cure: before you label a worker, ask who directs the work and who pays for the tools.

Pause and choose one of these two prompts.

(a) Describe one task in a job you have held or watched closely that a machine or an app now does, and say which sector the work belongs to.
(b) Describe how one service you use, such as a ride, a meal, or a repair, reaches you. Say whether the worker who delivers it is more likely an employee or an independent contractor, and what in the arrangement tells you.

Memory hook: the task is the same; the contract is not.

4. Ask about alienation: Marx on how work is organized

Picture the illustrative app driver from Section 3 at the end of a long evening. The driver carried forty meals, never saw one cooked, never met the people who cooked them, and followed a route chosen by software. The driver may feel fine, or tired, or proud of a fast night. Marx asked a different question: not how the driver feels, but how the work is arranged.

Week 1 named alienation as Marx's word for workers estranged from their work. Here you meet its four parts in full. Marx set them out in his Economic and Philosophic Manuscripts of 1844 (written 1844). Workers can be estranged:

from what they produce, because the product belongs to someone else and they may never see it finished;
from the work process, because someone else sets the pace, the steps, and the tools;
from one another, because the work is arranged so that workers rarely meet or act together;
from their own human potential, because the work uses little of what a person can think, plan, or create.

Worked example — the four parts on one job. Run the illustrative app driver through each part.

From the product. The driver never sees the meal cooked and has no say in what it is. Estranged from the product.
From the process. The app sets the route and the pace, and the driver's rating depends on following it. Estranged from the process.
From one another. The drivers rarely meet one another; each works alone in a car. Estranged from other workers.
From human potential. The work uses little of what the driver can do beyond driving and following directions. Estranged from potential.

In words: all four parts describe the way the work is organized. That makes alienation a claim at the macro level, about a structure many workers share.

Misconception check — "alienation means the worker hates the job." Students often read alienation as a bad mood. It is tempting, because the everyday word means feeling cut off. But Marx's concept describes how work is organized, so a driver who enjoys the night can still work in an alienating arrangement. The cure: ask about the arrangement, not the feeling. Alienation is never a measure of how any one driver feels.

Memory hook: product, process, people, potential.

5. Tell power from authority: Weber's three types

Imagine two people telling you to move your car. One is a stranger with a tow truck who says he will drag it away if you do not. The other is a parking officer in uniform who writes you a ticket. You might obey both. But you would feel very differently about each.

Weber drew that line in Economy and Society (1922).

Power, in Max Weber's definition, is the chance of carrying out one's own will even against the resistance of others.
Authority is power that people accept as legitimate, so they follow it because they believe it is rightful and not only because they are forced to.

The tow-truck stranger has power over you. The parking officer has authority. Weber then asked what makes people accept authority, and he named three types.

Traditional authority is Weber's type of legitimate authority that rests on long-established custom, followed because things have always been done that way.
Charismatic authority is Weber's type of legitimate authority that rests on followers' belief in a leader's extraordinary personal qualities, which is a different thing from being charming.
Rational-legal authority is Weber's type of legitimate authority that rests on laws, written rules, and the offices they create, so it belongs to the office and not to the person holding it.

Worked example — three illustrative leaders. Name the type of authority in each case.

In a family-run shop, the eldest child runs the counter, and no one questions it, because it has always been done that way. Custom: traditional authority.
A movement leader draws thousands of followers who believe she has a rare gift for seeing what others cannot. Belief in extraordinary qualities: charismatic authority.
A licensed building inspector closes a construction site for a safety violation, and the crew stops work, because the office carries that power, whoever holds it. Laws and the office: rational-legal authority.

In words: ask where the legitimacy comes from. Custom points to traditional, a leader's believed gifts point to charismatic, and written rules and offices point to rational-legal.

Week 5's bureaucracy is the home of rational-legal authority: its written rules and hierarchy of offices are what give an inspector, a manager, or a clerk the right to give an order.

Caveat: the three types are a classroom model, and the authority you meet in real life often mixes them. A long-serving mayor may hold a rational-legal office, enjoy a little charisma, and lean on the habit of re-electing the familiar name.

Misconception check — power and authority used interchangeably. Students often say "the boss has power" and "the boss has authority" as if they meant the same thing. It is tempting, because both make people do things. But authority is power people accept as legitimate. The cure: ask whether the people following would call it rightful.

Misconception check — "charismatic means charming." Students often read charismatic authority as being likable or good at parties. Charismatic authority rests on followers' belief in a leader's extraordinary qualities, which can exist without any charm at all. The cure: look at what the followers believe, not at the leader's manners.

Memory hook: custom, calling, or code — where does the "yes" come from?

6. Name the state: government, its forms, and taking part

Think of the public offices that touch your week: the agency that issued your driver's license, the court that handles a traffic ticket, the office that counts the votes. Those offices outlast the people in them. A new mayor or a new president arrives, and the license office keeps running.

That difference is the first distinction you need in this section.

The state is the set of political institutions that make and enforce laws for a territory and the people in it.
Government is the people and offices that run the state at a given time, which change while the state continues.

States are run in different ways. Here are four forms of government.

Monarchy is a form of government in which one person rules, usually holding the position by inheritance.
Democracy is a form of government in which citizens hold power, choosing leaders and laws through voting and representation.
Authoritarianism is a form of government in which one leader or a small group rules and allows citizens little say in how they are governed.
Totalitarianism is an extreme form of authoritarian rule that seeks to control nearly every part of public and private life.

In a democracy, how much power citizens hold depends on whether they use it.

Political participation is the ways people take part in politics, such as voting, contacting officials, campaigning, joining groups, and protesting.

Worked example — four illustrative countries and one neighbor. Name the form of government, then the kind of participation.

A country where the ruler's eldest child inherits the throne. One ruler by inheritance: monarchy.
A country where citizens elect a parliament every few years and can vote its leaders out. Citizens choose leaders through voting: democracy.
A country where one party rules, elections offer one choice, and critics risk arrest. One group rules and citizens have little say: authoritarianism.
A country where the ruling party also controls the newspapers, the schools, the clubs, and what people may say at home. Control of nearly every part of life: totalitarianism.
An illustrative neighbor who writes to a council member about a dangerous crosswalk, then joins a group pushing for a new stop sign. Contacting an official and joining a group: political participation.

In words: the form of government tells you who holds power on paper, and participation tells you how ordinary people use whatever share they have.

Misconception check — "the state and the government are the same thing." Students often use the two words for one idea. It is tempting, because news reports swap them. But the state is the lasting set of institutions, and the government is whoever runs it now. The cure: ask, "would this still be here after the next election?" If yes, it is the state.

Memory hook: the state stays; governments come and go.

7. Ask who holds power: pluralists and the power elite

Picture an illustrative town council meeting. On the agenda is a vote on whether to let a large warehouse open at the edge of town. A business group wants the jobs. A neighborhood group worries about truck traffic. A union local wants a say over the wages. The council votes. Who really decided?

Sociologists give you two competing models.

The pluralist model is the view that political power is shared among many competing groups, none of which dominates for long.
The power-elite model is C. Wright Mills's view, set out in The Power Elite (1956), that a small, interlocking corporate, military, and political elite holds decisive power.

This is the same Mills who gave you the sociological imagination in Week 1. Here he turned that imagination on power.

Each model has real strength. The pluralist model points to the many groups that win some fights and lose others, and to elections and councils as places where no single group gets its way every time. The power-elite model points to the people at the top of business, the military, and government who share backgrounds and move between those worlds. It asks whether the open fights are over smaller questions while the larger ones are settled before any vote. The wider conflict view, rooted in Marx, reads power as following ownership. This course presents each at full strength and gives no verdict.

Worked example — the warehouse vote, three lenses. Read the same vote through each perspective.

Structural functionalism (macro). The vote coordinates the town's competing needs, jobs against traffic, and the council is the part of the system built to balance them.
Conflict theory (macro). The question is whose interests reached the council first and whose did not; a group that can pay for studies and lawyers may shape the choices before the public sees them.
Symbolic interactionism (micro). The question is what a council seat, a three-minute public comment, or a protest sign means to the people in the room, and how those meanings make the vote feel fair or rigged.

In words: the first two lenses read power at the macro level of groups and institutions; the third reads it at the micro level of meanings made in one room. No lens is declared correct, and neither model is declared the winner.

Misconception check — "one model is the right answer." Students often decide that power "really" belongs to everyone or "really" belongs to a few. Both moves skip the weighing. Each model is a perspective with evidence on its side. The cure: state each at full strength, then say what further evidence would help you weigh them.

Pause and choose one of these two prompts.

(a) Describe a decision in a group you belong to, such as a club, a team, or a workplace, and say whether it looked more like the pluralist model or the power-elite model, and why.
(b) Describe a public decision you have read about, at any level, and say what evidence a pluralist would point to and what evidence a power-elite theorist would point to.

Memory hook: many hands or a few — weigh the evidence, not the slogan.

8. Read the union figures: 2025 and 1983, four ways

Now read the real numbers with Week 2's four questions. First, two definitions you need for this figure.

A labor union is an organization of workers that bargains with employers as a group over pay and working conditions.
The union membership rate is the share of wage and salary workers who are members of a labor union, a rate of workers and not of the whole population.
Wage and salary workers are people paid wages or a salary by an employer, the base the union membership rate is measured against; the self-employed are not included.
The public sector is the part of the workforce employed by federal, state, or local government.
The private sector is the part of the workforce employed by private businesses and organizations rather than by government.

Notice the connection to Section 3. An independent contractor is self-employed, so the driver who works through an app is outside the base of this rate.

The table below sets out the figures you will work with.

Union membership among U.S. wage and salary workers, 1983 and 2025, from the Bureau of Labor Statistics' Union Members release
Figure	1983	2025
Union membership rate, all wage and salary workers	20.1%	10.0%
Union members, count	17.7 million	14.7 million
Union membership rate, public sector	not pinned	32.9%
Union membership rate, private sector	not pinned	5.9%

Worked example — the union figures, read four ways. Take the five steps in order.

What is measured? The union membership rate, the share of wage and salary workers who were members of a labor union, and the count of members, from the Bureau of Labor Statistics' Union Members release.
Over whom? Wage and salary workers in the United States in 2025, compared with 1983, the first year with comparable data. The self-employed, including independent contractors, are not wage and salary workers, so they sit outside the base.
What does it show? Work it one step at a time.
- The 2025 figures: 10.0% of wage and salary workers were union members, which was 14.7 million people, written out as 14,700,000.
- The 1983 figures: the rate was 20.1%, and there were 17.7 million members, written out as 17,700,000.
- The rate, the change: 20.1 − 10.0 = 10.1 percentage points lower, and 10.1 ÷ 20.1 × 100 ≈ 50.2, so the 2025 rate was about half the 1983 rate.
- The count, the change: 17.7 − 14.7 = 3.0 million fewer members, written out as 3,000,000, and 3.0 ÷ 17.7 × 100 ≈ 16.9, so the count was about 16.9 percent smaller than in 1983.
- Count to base: 14.7 million members were 10.0% of wage and salary workers, so 14.7 ÷ 10.0 × 100 = 147, about 147 million wage and salary workers in 2025, or about 147,000,000. In 1983, 17.7 ÷ 20.1 × 100 ≈ 88.1, about 88.1 million, or about 88,100,000.
What does it not show? Why the rate fell, since the figures describe a fall and do not explain it. It is not a share of all people, because children, retirees, the unemployed, and the self-employed are outside the base. It does not show what union membership does for any worker, or anything about one worker you know.
Correlation or cause? Neither. You are reading descriptions of two years of membership, not a test of what causes workers to join or leave unions.

In words: the rate fell by about half while the count fell by about a sixth, because the number of wage and salary workers grew. A count and a rate can tell you different stories, so you read both with the base named.

Worked example — the two sectors. Now read the 2025 sector rates the same way.

The gap. The public-sector rate was 32.9% and the private-sector rate was 5.9%, so 32.9 − 5.9 = 27.0 percentage points apart.
The ratio. Then 32.9 ÷ 5.9 ≈ 5.6, so the public-sector rate was more than five times the private-sector rate.
What the overall rate hides. The overall rate is 10.0 − 5.9 = 4.1 percentage points above the private-sector rate, and 32.9 − 10.0 = 22.9 percentage points below the public-sector rate. The overall 10.0% sits much closer to the private-sector rate. It describes no worker in either sector, so you report the two sectors beside it.

Put the two sector rates side by side: 32.9% versus 5.9% means the public-sector rate is about 5.6 times the private-sector rate. A union organizer deciding where to spend a year of recruiting would read those two rates, not the overall 10.0%, because the overall figure hides two very different worlds. That is the practical stake in reading the measure.

In practice (your tools). You can check every step in a free spreadsheet. Type 20.1 in A1 and 10.0 in A2. In A3, type =A1-A2 to get 10.1, the drop in percentage points, and in A4, type =A3/A1*100 to get about 50.2, the percent change. Type 14.7 in B1 and 10.0 in B2. In B3, type =B1/B2*100 to get 147, the base in millions of wage and salary workers. Type 32.9 in C1 and 5.9 in C2, and in C3 type =C1/C2 to get about 5.6.

Misconception check — "10% of Americans are in a union." Students often read the union rate as a share of the whole population. It is tempting, because most percentages in the news are shares of everyone. But the base is wage and salary workers, which leaves out children, retirees, the unemployed, and the self-employed. The cure: name the base before you say the number.

Misconception check — "the count fell, so the rate fell the same amount." Students sometimes expect a count and a rate to move together. Here the count fell about 16.9 percent while the rate fell by about half. The cure: check whether the base grew or shrank before you compare.

Limitation: a group rate is never a fact about one person. Reading the 10.0% as "my coworker probably is not in a union" applies a group figure to one person, the ecological fallacy from Week 8.

Memory hook: a rate of workers, not of people; two sectors, two worlds.

For more on this week's ideas, the module's Readings & Resources page links to short articles and videos.

Key terms

Economy — The social institution that organizes how a society produces, distributes, and consumes goods and services. (first used: 1. Follow the coffee: the economy's three sectors)
Primary sector — The part of an economy that draws raw materials from nature, such as farming, fishing, forestry, and mining. (first used: 1. Follow the coffee: the economy's three sectors)
Secondary sector — The part of an economy that turns raw materials into manufactured goods, such as a factory or a processing plant. (first used: 1. Follow the coffee: the economy's three sectors)
Tertiary sector — The part of an economy that provides services rather than goods, such as retail, health care, teaching, and delivery. (first used: 1. Follow the coffee: the economy's three sectors)
Post-industrial economy — An economy in which services, rather than farming or manufacturing, employ most workers. (first used: 1. Follow the coffee: the economy's three sectors)
Capitalism — An economic system built on private ownership of productive property and production for profit. (first used: 2. Compare two systems: capitalism, socialism, and the mixed economy)
Socialism — An economic system built on collective or state ownership of productive property, with production aimed at shared needs. (first used: 2. Compare two systems: capitalism, socialism, and the mixed economy)
Mixed economy — An economy that combines private ownership and markets with public ownership, regulation, and shared programs; actual economies, the United States included, are mixed. (first used: 2. Compare two systems: capitalism, socialism, and the mixed economy)
Automation — The use of machines and software to do tasks that people once did. (first used: 3. Watch work change: automation, gigs, and contracts)
Gig economy — Work arranged as short, separate tasks or jobs, often assigned through an app and paid by the task rather than by the hour or the year. (first used: 3. Watch work change: automation, gigs, and contracts)
Employee — A worker who works under an employer's direction and is paid wages or a salary on the employer's payroll. (first used: 3. Watch work change: automation, gigs, and contracts)
Independent contractor — A self-employed worker who sells a service under a contract, usually setting their own hours and supplying their own tools, and who is not on the buyer's payroll. (first used: 3. Watch work change: automation, gigs, and contracts)
Power — In Max Weber's definition, the chance of carrying out one's own will even against the resistance of others. (first used: 5. Tell power from authority: Weber's three types)
Authority — Power that people accept as legitimate, so they follow it because they believe it is rightful and not only because they are forced to. (first used: 5. Tell power from authority: Weber's three types)
Traditional authority — Weber's type of legitimate authority that rests on long-established custom, followed because things have always been done that way. (first used: 5. Tell power from authority: Weber's three types)
Charismatic authority — Weber's type of legitimate authority that rests on followers' belief in a leader's extraordinary personal qualities, which is a different thing from being charming. (first used: 5. Tell power from authority: Weber's three types)
Rational-legal authority — Weber's type of legitimate authority that rests on laws, written rules, and the offices they create, so it belongs to the office and not to the person holding it. (first used: 5. Tell power from authority: Weber's three types)
State — The set of political institutions that make and enforce laws for a territory and the people in it. (first used: 6. Name the state: government, its forms, and taking part)
Government — The people and offices that run the state at a given time, which change while the state continues. (first used: 6. Name the state: government, its forms, and taking part)
Monarchy — A form of government in which one person rules, usually holding the position by inheritance. (first used: 6. Name the state: government, its forms, and taking part)
Democracy — A form of government in which citizens hold power, choosing leaders and laws through voting and representation. (first used: 6. Name the state: government, its forms, and taking part)
Authoritarianism — A form of government in which one leader or a small group rules and allows citizens little say in how they are governed. (first used: 6. Name the state: government, its forms, and taking part)
Totalitarianism — An extreme form of authoritarian rule that seeks to control nearly every part of public and private life. (first used: 6. Name the state: government, its forms, and taking part)
Political participation — The ways people take part in politics, such as voting, contacting officials, campaigning, joining groups, and protesting. (first used: 6. Name the state: government, its forms, and taking part)
Pluralist model — The view that political power is shared among many competing groups, none of which dominates for long. (first used: 7. Ask who holds power: pluralists and the power elite)
Power-elite model — C. Wright Mills's view, set out in The Power Elite (1956), that a small, interlocking corporate, military, and political elite holds decisive power. (first used: 7. Ask who holds power: pluralists and the power elite)
Labor union — An organization of workers that bargains with employers as a group over pay and working conditions. (first used: 8. Read the union figures: 2025 and 1983, four ways)
Union membership rate — The share of wage and salary workers who are members of a labor union, a rate of workers and not of the whole population. (first used: 8. Read the union figures: 2025 and 1983, four ways)
Wage and salary workers — People paid wages or a salary by an employer, the base the union membership rate is measured against; the self-employed are not included. (first used: 8. Read the union figures: 2025 and 1983, four ways)
Public sector — The part of the workforce employed by federal, state, or local government. (first used: 8. Read the union figures: 2025 and 1983, four ways)
Private sector — The part of the workforce employed by private businesses and organizations rather than by government. (first used: 8. Read the union figures: 2025 and 1983, four ways)

Summary

The economy is an institution with three sectors: take it, make it, serve it.
A post-industrial economy employs most of its workers in services.
Capitalism and socialism are models; actual economies are mixed.
An employee and an independent contractor can do the same task under different arrangements.
Marx's alienation describes how work is organized, not how one worker feels.
Authority is power people accept as legitimate, in Weber's three types.
The state lasts; governments change; people take part through political participation.
The pluralist and power-elite models are weighed, not crowned.
The union rate fell from 20.1% to 10.0% of wage and salary workers, 1983 to 2025.

Check your understanding

Work these before looking at the answers — they are ungraded, and the answers (with reasoning) are at the bottom of the page.

An illustrative county employs 6,000 wage and salary workers. Of them, 840 belong to a union. What is the county's union membership rate, and what would be wrong with calling it "the share of the county's residents who are in a union"?
In an illustrative region, the union membership rate among hotel workers fell from 18% to 12% over a decade. By how many percentage points did it fall, and by what percent?
Name the type of authority in each case. (a) A village elder's word settles a dispute because elders have always settled disputes. (b) A hospital's chief of surgery assigns operating rooms because the hospital's rules give that office the job. (c) A street preacher's listeners quit their jobs to follow him because they believe he has a special calling.
A lumber mill cuts logs into boards. The logs come from a forest the mill's owner also runs, and the boards are sold through the owner's hardware store. Sort each activity into a sector, and say what the example shows about sorting.

Answers (worked reasoning — read after attempting)

The rate is 840 ÷ 6,000 × 100 = 14, so 14% of the county's wage and salary workers are union members. It is not a share of the county's residents, because the base leaves out children, retirees, the unemployed, and the self-employed; the same 840 members would be a much smaller share of all residents.
18 − 12 = 6 percentage points. As a percent change, 6 ÷ 18 × 100 ≈ 33.3 percent, so the rate fell by about a third. Both are true at once, and the unit tells the reader which one you mean.
(a) Traditional authority, resting on custom. (b) Rational-legal authority, resting on rules and the office. (c) Charismatic authority, resting on followers' belief in his extraordinary qualities; whether he is charming does not matter.
Cutting trees in the forest is primary (drawing a raw material from nature), sawing logs into boards is secondary (making a manufactured good), and selling boards in the store is tertiary (a service). One owner works in all three sectors, so you sort the activity, not the company.

Next up in this module: the Readings & Resources page, the lecture tutorial, the practice set, the quiz, the discussion, and the assignment — and next week the course turns to population and social change, with the demographic transition model as its first tool.

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