Difference Between Command Economy And Free Market Economy

INTRODUCTION OVERVIEW The major difference between command economy and free market economy is the degree of government intervention and the reliance of market to determine prices (Cherunilam, 2009). Command market is the system in which the market is centrally controlled and regulated by the government; free market economy is the system demand and supply determine the market prices and regulations. However, mixed economy is a combination of Command and Free market economy (Bogolib, 2013); the market price is determined by demand and supply but the government intervenes to ensure stability and economic growth. This intervention has a major impact in the position of an economy in the business cycle. This report evaluates the advantages and disadvantages of England being a mixed economy, and shows how the government intervenes in the market. AIMS AND OBJECTIVES The essay is fo ENGLAND S MIXED ECONOMY With mixed economy there is always a variation to the degree of government intervention in different countries. In England, where the mixed economy is utilized, there is a strong presence of both the private and public sector. For instance, the grocery sector is controlled by the market; However resources are allocated in the health sector by the government (Higson, 2011). Although there is a distinct private sector, the system allows the government to exert control over the operations of businesses in the private sector to achieve economic balance and stability (Barras,Show MoreRelatedThe Differences between Command Economies and Free Market Economies478 Words   |  2 PagesThe Differences between Command Economies and Free Market Economies The prime difference between command economies and free market economies is the method used to answer the three central questions of what, for whom, and how? 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