"a little bit of both"
The United States is a prime example of a mixed economy as we combine public and private enterprise.
Other countries include the United Kingdom, Iceland, Sweden, and France.
- Most business and industry can be left to private firms
- Enables government regulation in places where there is market failure
- Regulates abuse on monopoly power
- Provides macroeconomic stability
- Difficulty monitoring how much the government intervenes
- Can lead to inequality and inefficient use of resources
- It is argued that the government make up as poor managers of the economy.
What will be produced?
Consumers exercise their consumer sovereignty which shifts the curves of demand and supply. In the case of the mixed economy the private and public sector have input on what will be produced. This affects what industries and business produce and what price levels they will place their products at. If the market is doing poorly the government can implement price floors and price ceilings to affect tax and interest rates. This will affect businesses and in turn have an effect on what and how much they produce of a certain product.
How will it be produced?
The private sector is the main producer of consumer goods with the exception to certain government services. This makes it fairly easy to start a business in the mixed economy. The private industries will undertake cost efficient methods in order to produce the most quality and quantity of there product which by their prediction will sell.
For whom will it be produced?
Mixed economies produce for nearly anyone who is interested in spending money on their product and does not set limitations for just people within the country. Through foreign exchange producers can sell to consumers in countries halfway across the world, after all that is where the initial products are made nevertheless.