Economic Systems Used by Countries

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INTRODUCTION
An economic system is the ways which a country allocates its resources. It is ways in which production is done, how to allocate resources that have been produced. An economic system is aimed at solving the four economic system which are command, market, traditional and mixed system. Countries this days usually use the mixed economic system and market system. Each of the system will be discussed and analysed.
• Command economic system
In this economic system all the resources are controlled and managed by the government and in that the government produce goods and services for everybody in a country. All the decisions in an economic system are taken by the government on what to produce, where and how to produce. Sometimes this economic system does not work for people because since the government has a control to every resource, they can dictate the people.
 Advantages: is that the unemployment is very low most of the people I he country are employed. The prices of goods and services are low so that everyone can afford the goods and services and also the inflation rate is low.
 Disadvantages: people/firms cannot choose what they want to produce, the government tells what, how to produce. The lack of profit motive leads the businesses to perform poorly and not produce good quality prices.
• Market system
The supply and demand of products determine the price at which goods and service will be sold. Decisions concerning pricing of goods and services in this economic system is taken by the individuals. There is no government intervention as in like command system, the government can only intervene to an extent at which they need to stabilize the prices if they are too high. According to Adam Smith (1776:25) as cited in (S...

... middle of paper ...

...-Hill book
• Miles, R.1987.Capitlism and unfree of labour.1st ed.new York: Tavistock.
• Torado, P.M.2000.economics development.7th edition.london: Pearson education limited.
• Marshall, Alfred, principle of economics.1920.library of economics and liberity.retrieved may 7 2014 from World Wide Web from http://www.econlib.org/libary/marshall/marp.html.
• South Africa-Africa economic outlook(.2014).Retrieved from http://www.afriaeconomicoutlook.org/countries/southern Africa/south -Africa
• Dostoc(2013)Traditional system retrieved from http://www.docstoc.com/docs/1349723861a/traditional-economy-is-a-system-where-traditions-and-beliefs
• Answer bag(2013-2014)economic system south Africa retrieved from http://www.answerbag.com/q_view/2440766
• Mixed economy(2014)retrieved from http://www.engineeringnews.co.za/artilces/government-suppos-mixed-economy-says-zuma-2009-08-14

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