This essay aims to identify main fundamental characteristics of free market economy and mixed economy systems, while comparing and contrasting them.
The essay exposes each system’s demerits and merits, and concludes with a statement of the better economic system of the two.
Download file to see previous pages...
This can ensure that qualified medical care practitioners and welfare personnel receive prior training before employment. This ensures that the low earning bracket can access a minimal, equal level of up-to-standard medical care and treatment just like the high-income society members (Anderton, 2008). However, some officials may embezzle government funds while taking advantage of the welfare program. Medical practitioners may see an investment in their course of private practice. Some individuals may want a higher level of medical care than is available from the governing body and may lack freedom to choose. In some industries, the corporate sector experiences increased regulation resulting to decreased corporate greed. An adverse instance would be the Enron case that caused numerous workers to leave without proper retirement packages. This corporation, which the government controls, would control this greed, thus shielding the rights of people (Anderton, 2008). The modes of retirement in an entity that operates in a free market would yield promising returns for employee investments.. A corrupt administration can cut down retirement benefits into reserves of few. When entities facilitate businesses in a fixed economy, individual relationships may favor and push someone ahead when they cannot trace other methods. This holds a downside in business ethics in most mixed economy markets. USA citizens would find this issue debatable. Methods such as guanxi to fortify business initiatives, or business processes can result into bribery or corruption. A free market economy functions via voluntary exchange without control from a capitalist monetary system. A free market economy has numerous benefits to clients and businesses. Most demerits of...
This essay is one of the best examples of comparison of the distinctive characteristics of free market economy and mixed economy types of system. In a mixed economy, the privatized businesses and the government share the control of monetary systems. A mixed economy market confers various advantages. In presentation of the fundamental advantages, it is pertinent to address every merit with a demerit to acquire a clear perspective of the differences between a free economy market and a mixed economy market. Foremost, the control level that the ruling government holds within a mixed monetary system causes it to hold a chief role in service delivery. The private domain has a responsibility to aid in building infrastructure and offer services. This may elicit an increase in efficiency. Owing to this, a problem would come up if the government refutes to ascertain the type of infrastructure it requires from the private entities. Production may fail to keep on track with demand and supply of the population and create a surplus, or scarcity of merchandise and services, contributing to loss of profits
A free market economy functions via voluntary exchange without control from a capitalist monetary system. A free market economy has numerous benefits to clients and businesses. Most demerits of any economy lie within the issues of microeconomics, namely employment, laws, and wages. In current times, unemployment is a rampant factor that causes companies to commute overseas to nations like China.
...Download file to see next pagesRead More
Cite this document
(“Comparison of Free Market Economy and Mixed Economy Systems Essay”, n.d.)
Retrieved from https://studentshare.org/macro-microeconomics/1493169-comparison-of-free-market-economy-and-mixed-economy-systems
(Comparison of Free Market Economy and Mixed Economy Systems Essay)
“Comparison of Free Market Economy and Mixed Economy Systems Essay”, n.d. https://studentshare.org/macro-microeconomics/1493169-comparison-of-free-market-economy-and-mixed-economy-systems.
Infact most economies are mixed, with different levels of government intervention (Alan, 2012). Mixed economies are composed of private businesses that operate a large share of the market. The government comes in given areas of economy, for instance public spending and price regulation.
This essay primarily focuses on the identification of the distinctive features of two most common economic system in the world. Free market is an economic system that is determined by the price mechanism. A mixed economy is a combination of a free market and planned economies. Free market economy is deemed more effective compared to a mixed type.
These two parties decide what to produce and what to purchase. A free market economy is based on the forces of demand and supply with little or minimum government intervention in the form of subsidies, taxes and regulation (Kates, 2011:34). The means of labour are privately owned and this enables parties to according to their own self-interests.
The free market economy is characterised by private ownership of property and/or resources, means of production, consumer sovereignty, competition and independent choices. The free market economy is more effective than the mixed economy due to the fact that investors or businesses and the consumers have control over the market, i.e.
The free market economy is well discussed in the following paragraphs.
A free market economy is the type of economy(Slavin, 1989) in which the resources are allocated based on the basic economic law of supply and the demand for them. But reality, this is mainly a theoretical concept because we all know that in every country ,including capitalist ones, there are import restrictions or quotas established to protect the countries' local competitors.
Applied to an economy, perfect competitive economy would refer to a free market where there would be existence of the private enterprises and the price would be determined in the economy by the demand and supply in each of the markets. There would be no intervention on part of the government to control the prices or the quantities in the market. A monopoly market is one in which there is a single seller who would have the entire market power and hence the buyers in the market would be the price takers and would have to pay the monopolist-set price in order to purchase the product.
In the developed world, there are arguments both for and against certain economic systems.
In United States, the two competing economic systems are the free markets systems and the mixed markets economy. The free markets economy is an economic system
To begin with, a free market economic system is one that answers all economic questions regarding what to produce, how to produce these items and when to produce them. It allows the forces of demand and supply to interact freely to determine a region’s economic
5 Pages(1250 words)Essay
GOT A TRICKY QUESTION? RECEIVE AN ANSWER FROM STUDENTS LIKE YOU!
Let us find you another Essay on topic Comparison of Free Market Economy and Mixed Economy Systems for FREE!