University:
London School of Economics and Political Science
Course:
L400 | International Social and Public Policy
Academic year:

2024
Views:

319

Pages:

2
Author:

Prerna T

Comparative Economic Systems Remember that the price mechanism is the main way in which we allocate resources in the UK. This system of resource allocation is often called capitalism or the market economy. This contrasts with communism, also known as a centrally planned economy. What are the key characteristics and the advantages/disadvantages of each type of system? Working in pairs, refer to pages 55-61 of the textbook and use Google to find some appropriate websites where you can uncover more details about these systems. Market Economy Key characteristics: > All resources owned by Private individuals > Entrepreneurs will de cicleg what, how and for whom to proches > Prices are determined by producers & consumas > Workers are only employs a if they are better + cheaper than capital > Goods + Senices ge-poduer only if they che profitse Centrally Planned Economy Key characteristics: > Government will decicle what, how, and for whom to prede > Prices are delewined by What is the invisible hand? Who coined this term, and how does it explain the workings of the market economy? the pho nechte Invisible hand the thout it we leave the economy to be oun devices, it will work well. ADAM SMITH control the allocation the price mechanoom will of removies intervention by itsey, Using your findings overleaf and any further research from the internet, build a list of advantages and disadvantages of each type of economic system. Economic Systems ADV Market Economy makes country more internationally competitive provides incentive in order to profit So move compention 15.0.c. q of gist in firms DISADV High inequalits tveawal distribution of incoro Centrally Planned Economy APV More Encourages production of men't goods, decreases demerit goods Looking at your flow chart, what kind of economy would really be ideal? In fact, thinking about the UK, what kind of system do you think we actually have? mixed ecoway How do you know that we have this system of resource allocation? Can you think of some contrasting examples of resource allocation to substantiate your answer? -provision of public goods -thave it inerwality. but there's CL wave system