Types of Economic Systems 4 types of economic

Types of Economic Systems

4 types of economic systems 1. traditional-focuses on good &services to customs/culture 2. command- controlled by a central power usually the gov’t 3. market- free market & little to no gov’t interference 4. mixed economies-mixture of a market and a command economic system

Traditional Economies * most basic type of economy * usually found in your LDC’s *lacks specialization and division of labor * low output or production , but is sustainable for the LDC’s *usually in countries that rely on agriculture Ex. ___________________________

Command Economy Found in countries with a dominant centralized power In most communist countries No free market- meaning the consumers & supply/demand don’t influence what is produced usually the gov’t decides what is produced which means not as many options or choices Ex. ________________________

Market Economy Free market with little or no gov’t involvement also known as capitalism Capital=$ The people decide what is made and produced based on demand supply “laissez-faire” capitalism-French meaning hands off approach Ex. _______________________

Mixed Economy Mixture of market and command economies Sometimes called a dual economy Most industries are privately own and a few of the public services are owned by the gov’t (for ex. Phone systems or transportation) Both private owners and gov’t play an =role in the economy Ex. _______________________