Free Market Economy Vs Command Economy

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Pages: 4

A command market and free market economy would fall under the several different types of governments. A command market economy is an economic system in which the state or government controls the factors of production, such as what goods should produced, how much should be produced and the price of which these products will be sold for (Nove,1987). Whereas a free market economy would be a system where the production and distribution of goods and services are determined by individuals, the characteristics of this system would be that self-interest is the motivating force of the economy.(Johnson,2005). These systems are work in contrast with each other, while both harbor many bad qualities they do also possess benefits that to the economy. This essay will aim to discuss the advantages and disadvantages of both the free market …show more content…
Unlike the command economy system, the free market economy does not focus on the basic necessities of the public. Furthermore, the senior citizens would be unable to assist themselves due to old age without the help from the government. The primary objective of any firm is to make profit. However, in many cases, companies may risk the workers safety, and ethical behaviors to achieve this. For example, the Deepwater Horizon oil spill in 2010, on of the largest environmental disasters in the US was largely attributable to the use of substandard cement and other cost-cutting measures (Eley,2011). In a free market economy, no one provides education, public services, or healthcare. Therefore, that would lead to the rich becoming richer and the poor becoming poorer. To sum it up, there will be a waste of resources, as well as, social injustice and economic instability. Monopolies will also become a common recurrence due to the lack of regulations and government