Economic Systems - created from Mind Map

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Mixed economy

Market economy

Traditional economy

Command economy

definition: an economic system combining both private and public enterprise

The united states is mostly a mixed economy, because there is a mixture of both command and market. It is often referred to as Capitalism

Pros:

Cons:

equal distribution of control

more efficiency for private firms

defined role for the government

freedom of private enterprise

more jobs

challenge of finding a balance

government going too far and managing the economy poorly

higher taxes to pay

limited corporate sizes

definition: production and prices are determined by competition between private businesses

Cons:

Pros:

can adjust to change

ideal of freedom

little government interference

large variety of goods and services

equal access to information

there are winners and losers

very competitive

people that loose their jobs are unable to support themselves

definition: goods are exchanged for other goods in a system called bartering

Pros:

cons:

stays close-knit and small in size

structured on customs,rituals, habits, and shared beliefs

works to support entire group and not just themselves/family

slow to adapt to new ideas and technology

low standard of living

don't deal well with environmental disasters

people roles don't change

Flood, fires, and drought

definition: government makes all economic decisions

Pros:

cons:

each person knows his/her role

simple to decide what,how, and whom to produce goods/services

ability to change economic direction quickly

low standard of living

do not meet the wants and needs of the people

no incentives

discourages new ideas