Abstract
An economic system is a set of interrelated elements that make up a common economic structure. It is common to distinguish 4 types of economic structures: traditional economy, command economy, market economy and mixed economy. The following article discusses all the four types of an economic system.
Highlights
Traditional economy is based on natural production
Personal development is very limited in a traditional economy and it is almost impossible to move from one social group to another that is high in the social pyramid
The planned economy is characterized by a rapid response to unexpected threats - both economic and military
Summary
Traditional economy is based on natural production. There is usually a strong agricultural bias. Traditional economies often use exchange instead of money In such a society, the development of technology is very slow. The division of professions into male and female still exists. All these traditions are reflected in the economy in one way or another. Command economy Command or planned economy is characterized by the centralized decision of what, how, for whom and when production. Demand for goods and services is determined on the basis of statistics and plans of the country's leadership. The planned economy is characterized by a rapid response to unexpected threats - both economic and military (remember how quickly the Soviet Union managed to evacuate its factories to the east of the country, which cannot be repeated in a market economy)
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