Economic Systems

By: Talasia T.

COMMAND ECONOMY: Another name for a command economy is a planned economy . A command economy is a more centralized economy . Government groups usually controls EVERYTHING is a command economy . A planning group decides which goods and services should be produced, as well as prices for goods and wages paid to the workers . In a command economy if a individual person tries to start a new business , that would be a MAJOR problem !

TRADITIONAL ECONOMY: In a traditional economy , most of the economic decisions that are made are based on custom and habits . " Traditon" means something that has been passed down in a culture from one generation to the next . Traditional economies are found in rural areas . This is where people have to farm , herding animals , or working in simple crafts and trades . Often very little money ever exchanges hands in a traditional economy . Southwest Asia is an example of a traditional economy .

MARKET ECONOMY: In this system decisions are made by individuals who decide what to produce and what to buy . Other names for a market economy is a " free enterprise " . Many countries in the Middle East{Southwest Asia} are a market economy or free enterprise .

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