Mixed Economy

Topics: Planned economy, Market economy, Mixed economy Pages: 3 (833 words) Published: August 20, 2013
Name: Luke Group: ECON 2

Why an increasing number of countries are choosing to have a mixed economy

Recent thirty years, the world has a lot of change. Many countries changed their form of government, like German reunification, the disorganization of Soviet Union. With that changing these countries also from command economy turn to mixed economy. On the other hand, after 2008 financial crisis and after bama steps up for health care reform, the USA more and more close to mixed economy. Mixed economy is an economic system in which both the state and private sector direct the economy, reflecting characteristics of both market economies and planned economies. The economists have find the weakness of command economy and free-mark economy, and increasing number of countries realize mixed economy is the best way to develop.

What’s the meaning of command economy? Alec Nove(1987) said there is no difference between a command economy and a planned economy. It is an economic system which decided what kind of goods need to produce and produce how many goods in a plan formulated by a government agency.

There are some advantages of economic planning. Like economy stability, have long term plans, developing rapidly and have a good social welfare. For example, at the start of the Soviet Union, the economy environment is very bad, but after 40 years developing of command economy the Soviet Union become a super power country. On the other hand there are also lots of disadvantages of it. Like resource distribute inefficiency, lack of market competition result in low productive efficiency, killing free enterprise and easy to give rise to corruption.

In 1978, China raised the reform and opening-up policy. At that time, China has keep the command economy nearly 30 years. Even though during that time China could use nuclear energy and spend money on infrastructure, the Chinese are very poor, and per person GDP row from the bottom second (Tianyong Zhou, 2008). From...

References: and Bibliography
Alec Nove (1987), The New Palgrave: A Dictionary of Economics, pp.879-880.
BBC (2013) ‘China Profile’, BBC News, 25th April. Available at: http://www.bbc.co.uk/news/world-asia-pacific-13017877 (Accessed 28th July 2013).
Paul R. &Robert C. (2004), “Comparing Economic Systems in the Twenty-First Century, Seventh Edition. p.538
Sloman, J. & Garratt, D.(2010). Essentials of Economics. 5th ed. Harlow: Pearson Education
Tianyong Zhou (2008), PRC News, 26nd August, Available at: http://theory.people.com.cn/GB/49157/49163/7727765.html
Continue Reading

Please join StudyMode to read the full document

You May Also Find These Documents Helpful

  • Mixed Market Economy for the Philippines Essay
  • Should America and Canada Have a Common Economy? Essay
  • Providing Country Examples Discuss the Success and Short Coming in Solving Economic Problems Within Command and Mixed Economies. Compare...
  • Ideal Economy Essay
  • Ghana is a mixed but capitalist oriented economy” critically examine this statement Essay
  • Traditional Economy, Command Economy and Market Economy Essay
  • Mixed Economy Essay
  • Essay about Free Market Economy vs. Command Economy

Become a StudyMode Member

Sign Up - It's Free