Do you agree with the view that in the present world there is no such thing as pure capitalist or pure centrally planned economies but what really exists is a mixed economic system? Elaborate on the reasons for your agreement or disagreement.

From my point of view all countries around the world benefits of mixed economic system, and there are absolutely any country either capitalism or socialism. The combination of free-market system and socialism can be demonstrated by a spectrum diagram such as Illustration A.

Source: Economics 6th edition

According to Illustration A, particular economic system lies along the spectrum between the two extremes, and any country has fully either planned economy (socialism) or free enterprise economy (capitalism). In addition, the diagram can indicate changes in the degree of mixture of  economic systems over time, and a general movement to free-market and more privatization both the former communist countries and western economies; for instance, in the USA, the government plays much smaller role in 2000s than 1980s. Also, Countries are different in degree and type of government intervention that it can be as regulation, subsidies and taxes, public ownership, partnership schemes with private companies (PPP), and so on. Consequently, two countries could have same position in the diagram, but governments intervene in their economies differently.

Some significant beneficial characteristics of privatization are boosting economy activities, making optimal use of the country`s facilities, enhancing efficiency, easing the government`s involvements in public activities that private sector under Public-Private Partnership (PPP) system contributes with the government to improve these services because governments believe that private sectors can manage or build railway, road, hospital, school better than public organizations.

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One thought on “Do you agree with the view that in the present world there is no such thing as pure capitalist or pure centrally planned economies but what really exists is a mixed economic system? Elaborate on the reasons for your agreement or disagreement.

  1. Alesia Simas August 14, 2014 at 8:40 pm Reply

    Oh my god! an amazing article dude. Thank you. However I am experiencing issue with ur rss . Don’t know why Unable to subscribe to it. Is there anyone getting identical rss problem? Anyone who knows kindly respond. Thnkx

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