Command Economy

A command economy is an economic system in which a central authority, such as a government, makes all economic decisions. In a command economy, the government owns and controls the means of production, such as land, factories, and other resources. The government also sets prices, wages, and production goals. This type of economy is also known as a centrally planned economy or a command and control economy.

History of Command Economy

The concept of a command economy has its roots in the Soviet Union, which adopted a centrally planned economy in the 1920s. The Soviet Union was the first country to implement a command economy, and it remained in place until the fall of the Soviet Union in 1991. Since then, many other countries have adopted command economies, including China, North Korea, and Cuba.

In a command economy, the government makes all economic decisions, including what goods and services to produce, how much to produce, and how to distribute the goods and services. This type of economy is based on the idea that the government can make better decisions than individuals or businesses. However, command economies are often criticized for their lack of efficiency and innovation.

Comparison Table

Summary

A command economy is an economic system in which a central authority, such as a government, makes all economic decisions. In a command economy, the government owns and controls the means of production, such as land, factories, and other resources. The government also sets prices, wages, and production goals. This type of economy is often criticized for its lack of efficiency and innovation. For more information about command economies, visit websites such as Investopedia, The Balance, and The Economist.

See Also

• Market Economy
• Mixed Economy
• Socialism
• Capitalism
• Supply and Demand
• Price Controls
• Inflation
• Deflation
• Monetary Policy
• Fiscal Policy

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