The economy in Galactic Civilizations III is a broad term that encompasses the total wealth, research, and manufacturing inputs and outputs of your empire. The major ways you control your economy are in choosing social (colony improvements) and military (starships) items to produce, and using the Govern window to adjust the economy wheel between research/wealth/manufacturing and social/military production with the Social/Military slider.
Colonies are the basis of all production in Galactic Civilizations III. They generate the wealth, research, and manufacturing that drive your empire forward.
Production refers to the output of a colony. It includes all of the manufacturing, research, and wealth output of the colony.
All colonies generate raw production from their population. Certain buildings, technologies, events, and approval modifiers will increase this raw production output, which is referred to as “Total Manufacturing”.
The Total Manufacturing of the colony is then divided into raw manufacturing points according to the economy wheel (Base Manufacturing), raw research points (Base Research), and raw wealth points (Income). The amount of Total Manufacturing in each of these subdivisions of production can be seen on the colony screen by viewing the tooltip for each category.
Finally, bonuses and penalties (from things like buildings, technologies, or events) are applied to each of these 3 categories of production, resulting in the manufacturing, research, and wealth output of the colony.
The economic wheel allocates production between wealth, research, and manufacturing. It can be changed freely at any time without penalty. Open the Govern window and click on your desired production balance.
Coercion is a raw production and approval penalty for setting the wheel too much in one direction. As approval factors into raw production Coercion can double the impact on raw production. Coercion kicks in from around 46/47% assigned to either wealth, research, or manufacturing and will increase as that percentage rises. It will reach a maximum of 50% at 100% focus on one of these areas.
As the approval penalty is a deduction directly against morale so it is possible to completely negate it by having morale up to 50% or more higher than the total population. This would offset even the maximum level of coercion and the result is no decrease in approval, which would mean no negative changes in raw production.
Global vs Local Economies
You can set an empire-wide production allocation from the main Govern panel, which can be accessed from the main map.
Finer tuning of a planet's economy can be done by building a Bureau of Labor, which will remove the focuses and add the planetary wheel to the planetary govern screen.
You can revert a colony's allocation to your empire-wide policy by checking the appropriate box on its local Govern panel.
The military slider allocates manufacturing between social (colony improvements) and military (starships) construction. You can set global/local policies in the same way as you adjust the economy wheel.
Note that any planet that is not currently sponsoring a shipyard will put all manufacturing points into social spending, regardless of where the military slider is set. The military slider also becomes locked in place, indicating that all points are being sent to social spending.
see Approval Approval is how happy your people are with their current situation. High approval increases resistance, production, growth, and influence, while low approval hurts those values. Approval also affects the overall production of the colony.
Approval goes up with morale-boosting effects such as colony improvements, technologies, and some trade resources. A planet's approval is equal to its morale score divided by its population (in billions of people).
Tourism generates wealth in addition to what your wealth allocation provides. Your tourism income increases with your cultural accomplishments.
Trade also generates wealth in addition to what your wealth allocation provides. To create trade routes, you must research the appropriate technology in order to begin building freighters. You must have an alien trade partner and an available trade license, then send a freighter from one of your planets to one of theirs. You cannot create multiple trade routes between the same two planets, and a trade route works the same no matter which civilization initiated the route.
Starbases are critical to any empire's economy, for gathering galactic resources, spreading Influence, and giving straight-up economy boosts to colonies within range.
Galactic Resources like Durantium and Antimatter are gathered from nodes on the main map by starbases, and allow you to build powerful special colony improvements and prototype starship components.
see Trade Resources
Trade Resources are found on colonies, and take up a tile that could otherwise be used for development. However, as the name implies they are valuable in trade and have various benefits to your empire as well. Trade Resources can be destroyed permanently in order to free up the tile for development.
Shipyards are where starships are produced. They are sponsored by colonies, often more than one (though a colony can only sponsor one shipyard at a time), and convert military manufacturing into warships, scouts, constructors, and more.