Economics in the U.K

Question one.

Using examples clearly distinguish between Subsistence, Market, Command and Mixed Economies. Illustrate how different economic systems allocate what is produced, how it is produced and who shares in production.

There are many definitions in circulation of what an economy is exactly, they vary in many ways, often depending on the individual, their beliefs and stance on cultural perspectives.

Figure 1. - Three definitions of the economy

Oxford Wikipedia

The state of a country or region in terms of the production and consumption of goods and services and the supply of money The wealth and resources of a country or region, esp. in terms of the production and consumption of goods and services.

http://oxforddictionaries.com/definition/english/economy

http://en.wikipedia.org/wiki/Economy

Within Societies, emphasis is in terms of goals and objectives over the years has been distributed in different ways, hence the evolution of four very different types of economies. Those economies that have evolved are today known as Subsistence, Market, Command and Mixed Economies. Each of these economies is in use in different countries around the world, and each displaying their own unique traits and leadership styles that will be displayed in this report.

Defining the different economies:

• Subsistence Economy

‘A subsistence economy is an economic system that is wholly reliant on the self provision of the community. Wealth in a subsistence economy is measured in terms of natural resources. A subsistence economy relies on hunting and cultivation for food and surrounding trees for building shelter and depending on the natural environments renewal and reproduction for survival'

• Market Economy

A market economy is a free market system in which decisions regarding resource allocation, production, consumption, price levels and competition are made by the collective actions of individuals or organizations seeking their own advantage. In all market economies, however, freedom of the markets is limited and governments intervene occasionally to encourage or dampen demand to promote competition, to thwart the emergence of monopolies.

• Command Economy

A command economy is one in which market mechanisms are replaced by a centralized state authority which co-ordinates all economic activity through commands, directives and regulations for the purpose of achieving broader socio-economic and political objectives. In a command economy, most forms of output are publicly owned by the state