Economic Systems

Today I my tutor has set for me to study economic systems, I first thought it would be boring.. but who doesn't have an interest in money? Better yet.. How things work?
So what is an economic system? An economic system is best described as a network of organisations used by a society to resolve the basic problems of what, how much and for whom to produce for.


Okay so we'll take a close look

1. Traditional economy 
The keyword is custom tradition. Custom tradition as an economic system is based off of the laws and economy of ancient lands, where capitalism has no effect of communities. For instance in the Asian Pacific, their ways of trading are completely different to western ways. They trade pig tusks and large rocks for goods or services. As a matter of a fact they have banks, who accept such rare items. The value is calculated by the weight of each item. In this economy they have NEVER had a bank robbery or such crimes. Though far behind they're economy is not based on capital.



2. Free Market Economy 
A free market economy is solely on the basis of buyers and sellers. The amount of products produced depends on the demand and the amount of products consumed and the amount of products consumed depends on the the household income of the public sector. The government limit themselves to protecting the property rights of people and business.

3. Planned or Command Economy
One word - COMMUNISTS! in a planned or commanded economy it is usually associated with socialist or communists, the state will ration resources, and all resources are owned by the state (I.E government - IE communists) according to its view. In this system the market has no say or control over rations or queing over scarce goods.

The definition of communists - Communist was first mentioned by Friedrich Engels & Karl Marx in the communist manifesto. Communism is a political party that set and enforce the following laws and more.

• Every man is equal (apart from the state)
• Resources and wealth are owned by and belong to the government
• The public sector are not able to exclusively or privately own anything.

4. Mixed Economy

A mixed economy and resources are owned by the government and some resources are owned by the private sector. The public or state sector sometimes intervenes in markets to correct perceived market failure