MARKET ECONOMY

PRIVATE PROPERTY
Labor resources, natural resources, capital resources (e.g., equipment and buildings), and the goods and services produced in the
economy are largely owned by private individuals and private institutions rather than by government. This private ownership combined
with the freedom to negotiate legally binding contracts permits people, within very broad limits, to obtain and use resources as they
choose.
FREEDOM OF ENTERPRISE AND CHOICE
Private entrepreneurs are free to obtain and organize resources in the production of goods and services and to sell them in markets of
their choices. Consumers are at liberty to buy that collection of goods and services that best satisfies their economic wants. Workers
are free to seek any jobs for which they are qualified.
MOTIVE OF SELF-INTEREST
The "Invisible Hand" that is the driving force in a market economy is each individual promoting his or her self-interest. Consumers aim
to get the greatest satisfaction from their budgets; entrepreneurs try to achieve the highest profits for their firms; workers want the
highest possible wages and salaries; and owners of property resources attempt to get the highest possible prices from the rent and sale
of their resources.
COMPETITION
Economic rivalry means that buyers and sellers are free to enter or leave any market and that there are buyers and sellers acting
independently in the marketplace. It is competition, not government regulation, that diffuses economic power and limits the potential
abuse of that power by one economic unit against another as each attempts to further its own self-interest.

SYSTEM OF MARKETS AND PRICES

Markets are the basic coordinating mechanisms in our type of economy, not central planning by government. A market brings buyers
and sellers of a particular good or service into contact with one another. The preferences of sellers and buyers are registered on the
supply and demand sides of various markets, and the outcome of these choices is a system of product and resource prices. These
prices are guideposts on which participants in markets make and revise their free choices in furthering their self-interests.
LIMITED GOVERNMENT
A competitive market economy promotes the efficient use of its resources. As a self-regulating and self-adjusting economy, no
significant economic role for government is necessary. However, a number of limitations and undesirable outcomes associated with the
market system result in an active, but limited economic role for government.
http://ecedweb.unomaha.edu/lessons/fecg2.htm

MIXED ECONOMY
Co-existence of public and private sectors
Both public and private enterprises exist in this economic system. The role and areas of both the sectors arc well defined.
The relative roles assigned to the public and private sector differ from economy to economy. But generally the public sector is expected
to perform certain basic functions such as:
(i) Development of economic infrastructures.
(ii) To promote basic industries that require huge investment and are of long gestation periods;
(iii) To promote industries in backward regions where inducement to invest is low.
(iv) To develop defence production industries in public sector.
Similarly, the private sector is expected to supplement the efforts of public sector and to take advantages of investment opportunities
enhanced by public enterprises.
In the mixed economy the two sectors are not rivals. The two sectors are partners in the process of development, because for the
efficient working of this system the co-operation between the two sectors is necessary.
The private sector in mixed economy operates under certain controls and regulations of the government.

Economic planning
Generally a mixed economy is a planned economy. Public sector enterprises have to work according to a definite plan to achieve
certain predetermined aims and objectives. Similarly the private sector is not left to develop in its own way.
The growth of private sector is also regulated through various controls and incentives to achieve the objects of plans.
Thus, the nature of economic planning in mixed economies is planning by direction for the public sector and for private sector planning
by inducement is adopted.
To ensures faster economic growth, the developmental programmes of both the sectors are coordinated in such a way that growth in
one sector complements the growth in the other sector.

Division of industrial undertakings

There is division of industrial enterprises in a mixed economy. The division of industrial sector may differ from economy to economy.
Generally, the industrial economy is divided into following:

(i) Exclusively State Monopoly. In it same strategic and basic industries are included.
(ii) Private Sector Industries. In it industries of lesser importance are included such as consumer goods industries, small scale
industries, etc.
(iii) Joint Sector Industries. The industries included in this sector are developed jointly by public and private sector.
(iv) Common Industrial Sector. Both public and private sector can establish industrial Generally a mixed economy is a planned
economy. Public sector enterprises have to work according to a definite plan to achieve certain predetermined aims and objectives.
Similarly the private sector is not left to develop in its own way.
The growth of private sector is also regulated through various controls and incentives to achieve the objects of plans.
Thus, the nature of economic planning in mixed economies is planning by direction for the public sector and for private sector planning
by inducement is adopted.
To ensures faster economic growth, the developmental programmes of both the sectors are coordinated in such a way that growth in
one sector complements the growth in the other sector.
There is division of industrial enterprises in a mixed economy. The division of industrial sector may differ from economy to economy.
Generally, the industrial economy is divided into following:
(i) Exclusively State Monopoly. In it same strategic and basic industries are included.
(ii) Private Sector Industries. In it industries of lesser importance are included such as consumer goods industries, small scale
industries, etc.
(iii) Joint Sector Industries. The industries included in this sector are developed jointly by public and private sector.
(iv) Common Industrial Sector. Both public and private
units in this sector.

Existence of social welfare and private profit motive

In mixed economy public sector works as the principle of social welfare motive. Public sector tries to reduce regional economic
inequalities and to increase employment opportunities.
The basis of price policy of public sector is social welfare instead of private profit. Whereas the operations and price policy of private
sector is guided by private profit motive.
But the private profit motive is controlled by government through fiscal and monetary policies, direct controls, etc.

Individual freedom
The people have freedom of consumption and to choose their occupations in this economic system. Private entrepreneurs are to
choose technique of production.
From the above discussion, it is clear that mixed economy is a marriage between capitalism and socialism.
It is an attempt to have the merits of both capitalism and socialism Therefore, it is said and rightly too that mixed economic system a
golden path between capitalism and socialism.

http://www.shareyouressays.com/95714/top-5-main-features-of-mixed-economy

Command Economy
Ownership: Nearly all of the country's factors of production are owned publicly by the government (or the state). The only factor over
which the government does not have total control is labour, but as you will see, they certainly have indirect control over the workers.

Objectives: The complete opposite of the pure self-interest of the free market system. No one (in theory) thinks of himself (or
herself). Consumers, workers and the government are all assumed to be working for the 'common good'. This system is often
associated with communist Soviet Union (as it was before 1989), but the fascist Hitler ran a 'planned' economy, albeit rather
dictatorially. I'm not sure that system ended up being for the common good! Also, democratic countries often attempt a less severe form
of planned economy via socialism.

Free enterprise:
The level of competition: Very little. Certainly, in the former Soviet Union, black markets used to develop as a result of shortages
in the shops. There would be competition between these racketeers, I suppose. But in theory there was no competition.

The pricing system: There is no competition, so there is no price mechanism. The authorities set the prices. It is because they set
prices at low levels to make sure that everyone can afford the goods that excess demand occurs causing long queues for goods
outside shops. Another inevitable consequence is the creation of black markets.

The planning system: This is an extra characteristic of the command economy. The other five has tried to follow the five given in
the 'free market economy' section. As the government runs the system, they have the job of planning how all the resources should be
used. They have to decide what should be produced and in what quantities. They must decide how the goods are to be made. What
labour should be used and where? What techniques of production shall we use? How will the completed goods be divided between the
workers (or consumers)? The key point is that they directly set the output levels and price levels.
http://www.s-cool.co.uk/a-level/economics/free-market-v-command-economies/revise-it/theoretical-economic-systems