4 Types of Economic Systems The 4 Types

The 4 Types of Economic Systems Four very different types of Economic Systems have

Traditional Economy Family or Community based economic systems Relies on ancestors customs and habits

Market Economy Individual or Consumer based economic system that relies on the consumption choices

Command Economy Central government makes all economic decisions. All means of production (land, labor,

Mixed Economy Economic system that is a mixture of traditional, market and command economies.

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4 Types of Economic Systems

The 4 Types of Economic Systems Four very different types of Economic Systems have evolved as different societies have placed different emphasis on different goals and priorities in their efforts to answer the Three Economic Questions: What to produce? How to produce? For whom to produce?

Traditional Economy Family or Community based economic systems Relies on ancestors customs and habits to make economic decisions. Bartering and trading system. Examples: Inuit (of Northern Canada) Aborigines Amazon (in Australia) Tribes (in South America)

Market Economy Individual or Consumer based economic system that relies on the consumption choices of consumers. Also called Capitalism, or free market economy. Entrepreneurs take risks to start new businesses. (ex. Shark Tank) Examples: There are not any pure market economies in the world.

Command Economy Central government makes all economic decisions. All means of production (land, labor, capital) are government owned and controlled. Examples: North Korea

Mixed Economy Economic system that is a mixture of traditional, market and command economies. Businesses get to make choices but there is some government regulation. Examples: United States Canada Japan Most modern economies