Types Of Economic Systems

A traditional economy is an economic system where people are wealthy by inheritance. This system has a very strong social network. It is strongly connected to farming. In most countries traditional economy has been replaced by command economy, market economy or mixed economy. Today it’s found mainly in underdeveloped, agricultural parts of south America, and Asia

Centrally Planned (Command) Economy- This is an economy where the government controls where the money goes. They decide what they want distributed and have private enterprises supply the goods. Cuba and North Korea have this type of economy


Market Economy- It is the opposite of a planned economy. There is no central government coordination. Individuals decide what is bought and sold based upon a free price system. Instead of pursuing the government’s plans, people pursue their own self-interest. Hong Kong and Singapore have this type of economy.


Mixed Economy- it combines elements of capitalism and socialism. It is a mix of market economy and command economy. There are private and state owned enterprises. The United States has a mixed economy.