How can Socialism solve economic problems ?
What to produce ?
In socialism, planning authorities decided what to produced. The Central Planning Authority or the government will collect detailed statistics on the resource availability in the country and link it with national priorities. If the planning authorities or government feels that the nation needs more computer for current and future consumption, more resources will be allocated for the production of computers over other products. Furthermore, under socialism we would produce for use and to satisfy the needs of all the people. Under capitalism, the industries operate for the main purpose which is to earn profit for their owners. Under capitalism, food is not grown primarily to be eaten. it is grown to be sold so that they can earn profit. Cars are not manufactured primarily to be driven. They are made to be sold. If there are enough buyers here and abroad, then the capitalist will have their factories turn out cars, appliances, shoes and everything else for which buyers can be found. However, if there are less of buyer, the domestic and foreign markets cannot absorb them, then these factories shut down and the country stagnates, no matter how much people need these commodities.
Meanwhile, under socialism the factories and industries would be used to benefit all of citizens, not restricted to the creation of profits for the enrichment of a small group of capitalist owners. Under socialism also, the citizens may received the finest facilities and they would be devoted to developing complete human beings, not wages slaves who are trained to hire themselves out for someone else`s profit.
How to produce ?
Under Socialism, The Central Planning Authority also decides on the techniques to be used in the production of different goods and services. The choice is between traditional and modern technique of production. For example, the planning authority has a choice of producing computer using...
Please join StudyMode to read the full document