Pros And Cons Of A Centrally Planned Economic System

When dealing with economics there are two major allocation systems, one of which is the Centrally planned system, and the other is the Market system. The centrally planned economic system is when the economic decisions are made by a state or government instead of the contact between consumers and businesses. Not like a market economy in which production decisions are made by private citizens and business owners. A centrally planned economy looks to control what is produced and how the resources are spread out and used. The production of goods and services are accepted by state-owned enterprises. A market system is when the economic decisions and pricing of goods and services are set by the collective exchanges of a country's citizens and businesses and there is little government involvement or …show more content…
Companies have the ability to execute even massive projects, attain their goals and establish industrial power. They can also subjugate the general population’s welfare and override self-interest (Command Economy Pros and Cons, 2014)”. More pros related to centrally planned systems are that they can prevent monopoly power abuse, and they also ensure the realization of well-defined long-term goals. Cons related to this system can be related to having problems trying to produce the correct exports, difficulty obtaining the information about the needs of the consumers, and treat to liberty and democracy. Some pros to a market system is that this system operates privately without the government controlling the system, which makes people have the right to make their own choices with the services and goods that they wish to purchase. A con that exists in the market system is the costs that are associated the production are not always going to be paid by the