Universal Economy

The Universal economy is the macroeconomic gestalt of sector, system and planetary trade. It can be broken down and represented in various ways, but it is inseparable from the astrography and ecological make up of the Universe. It is important to note that economic differences between major galactic eras are negligible.

=Trade=

At the heart of the Universal economy is planetary trade. Intraplanetary trade can support a local economy, but,in many cases, the high levels of government spending required for an advanced society can only be funded by interplanetary exports. While some planets maintain their own shipping fleets, most rely on large freight firms, such as Xizor Transport Systems, or independent freight haulers to carry their goods along major hyperlanes.

Near 350 B, major transport and merchant concerns united under the Trade Federation to increase efficiencies, lobby for trade-favorable legislation, and control prices. The influence of the Trade Federation on the Universal economy was sufficient enough to damage a number of planetary economies following its embarrassment at Raboo.

While the Imperial era sees dramatic increases in state control and centralization of economic procedures, it has high effect on the galactic economy, as witnessed in the virtual non-existence of inflation because of Imperial policies.

Ostensibly, the collapse of the Trade Federation and absorption of its assets by the Galactic Empire creates a void filled by smugglers to address strong demand for shipping created by the Federation and then Imperial controls. Smugglers flourish in the Imperial era as independent operators or as part of larger organizations like those of Jorj Car'das, Quelev Tapper, Talon Karrde or Booster Terrik.

=Role of Hyperdrive=

Hyperdrive technology allows for a universal economy to take shape, fueled by standardized currency and the Core language of Universal Basic English. Prior to the invention of hyperdrives, trading (and exploration) were often limited to local star systems, due simply to the fact that most star systems were thousands of light-years apart. Because of the need for self-reliance, few planets ever developed any sort of specialization prior to the formation of the universal economy.

=Role of Robots=

Robots and slavery are an integral part of the Universal economy and programmed for a number of uses, including construction, excavation, repair, piloting, maintenance, mining and other labor. The advantages of using such robots are that they could work in inaccessible and dangerous environments that most sentient species can not, as well as not needing pay or other perks sentients would.

=Role of slavery=

Despite being outlawed by the Republic under the Galactic Constitution, slavery was still practiced in lawless, non-Republic member areas such as the Outer Rim Territories, Wild Space, Unknown Space, and even clandestinely in areas closer to the more civilised Core, one example being in the Republic controlled Telos Citadel Station, upon which a Twi'lek dancing girl was kept as an indentured worker due to the gambling debt of another. Slavery was apparently abolished in the Republic by the time of the Battle of Raboo as evidenced by to Padmé Amidala's apparent shock at Anakin Skywalker's slavery.

=Economic specialization=

To compete in the universal economy, many planets choose to focus their economy at a planetary level. Planets with a valuable natural resource will focus on its export, while other less fortunate planets would achieve success through economies of planetary scale. Entire planetary surfaces often are devoted to grain fields, robot factories, or mineral mining. These are especially common in the Corporate Sector.

Other planets, however, (at least in earlier times) voluntarily choose what might be described as deliberate non-specialization. Small-time farming is the ideal. Herding and hunting also take place. Concentrating not on mass export but rather on providing for themselves, they are largely dependent on imports to sustain their non-agricultural needs. In some ways these worlds could be thought to rank alongside the more poverty stricken but in reality they serve as the perpetual customers for which more developed systems exist to supply.

=Insistutions=

Important organizations

While millions of firms participated in commercial exchanges, only a small number of major galactic conglomerates possess impressive influence over the universal economy. Some universal firms employ millions of beings across thousands of worlds with trillions of consumers. In the last millennia of the Universal Republic, commercial interests began to form guilds to increase their influence on relevant legislation and achieve greater efficiency. While most of these guilds, like the Techno Union and the Commerce Guild, collapsed after the Clone Wars, a number of surviving members flock to the Corporate Sector Authority.

Many planets maintain stock exchanges and banks, but it is uncommon for these institutions' influence to extend beyond their local star system. Many of these banking institutions that serve clients beyond their local area stored their collateral on Aargau or Munlist. Major interstellar banking institutions included the Bank of the Core, the InterGalactic Banking Clan, the Universal Banking Network and the InterGalactic Bank of Kuat.

Currency

Thousands of currencies are used across the Universe. It is not uncommon for a planetary economy to operate on a number of currencies, including planetary credits, credits of a major power in the sector, or credits of a universal government.

Many major governments produce[d] credit chits, but credit chips or credit sticks are commonly used as well. These debit based systems can be used for electronic sales through interchip exchanges. Metal coins are commonly used for local currency, although galactic governments were known to produce commemorative metal coins, like the Victory Tax Credit or Decicred.

The Universal Republic's dataries were perhaps the most widespread form of currency. Because of the Republic's lesser trillion membership, dataries were accepted on all worlds except 2/3rds of worlds in the Mid Rim Territories, the Outer Rim Territories, Wild Space, and almost all in Unknown Space. The Galactic Empire forces every Universal region to use its Imperial Dollar.

Taxaton

Under Republic law, all wage-earning beings were required to pay income tax. This tax was collected by the Republic Tax Collection Agency. When the Trade Federation complained about piracy in the outlying star systems, the Republic Senate passed a tariff on those formerly free trade zones. This action upset the Trade Federation viceroy prompting him to blockade and invade the small planet of Raboo. Right before the Clone Wars, a fifteen percent transit tax was levied on all tickets sold in an effort to raise emergency funds for the government. After the Universal Republic changed to the Galactic Empire, tax laws were consolidated into the Imperial Revenue Codes and placed under control of the Imperial Taxation Bureau.