Economies Throughout the World
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- In traditional economies, everyone in the community or society has a specific role that contributes to the whole progress of the community. Traditional economic systems represent the oldest model, where societies are more physically connected and socially satisfied through labor, farming and other simple processes. While traditional economic systems can have several benefits, their antiquated model can also present several potential drawbacks.
- In a market economic system, or a “free-market system,” communities, firms and proprietors act in self-interest to decide how to allocate and distribute resources, what to produce and who to sell to. Governments in market systems typically have little intervention in how businesses operate and generate income, however, can regulate factors like fair trade, policy development and honest business operations.
- In command economic systems, governments and centralized powers control much of the economic processes, including allocating and distributing resources, goods and services. In a command economy, the government plays a key role in directing and intervening in business processes that provide essential goods and services to the community. Many command economies consist of governments that have total control over the distribution and use of valuable resources, like oil and gas. You need to pay taxes to the government to.
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