DEFINITION AND KINDS OF ECONOMIC SYSTEM
The economic system
is the way it is used by a country to settle or face problems in the economic
field. There are several economic system has ever been and is still used today.
Selection of the economic system should be based on a common problem faced by the
country should also be suited to the circumstances of the country. some of the
economic system is the traditional economic system, liberal, centralized, and
mix. In this post I will explain the meaning and characteristics of each of
these systems. Hopefully my friend who already stop by at home and feel
satisfied. Amiiinnn.
A.
Traditional Economic System
1. Definition of
Traditional Economic System
Traditional economic
system is an economic system based on customs, traditions patterned community
of cultural values from generation to generation by relying on the factors of
production are.
2. Characteristics
of Traditional Economic System
- The absence of division of labor.
- Production technology is simple.
- Production is still limited and determined as needed.
- The distribution system is based on custom or tradition.
- The system is still in barter exchange.
- Still dependent on the agrarian system.
B. Liberal
Economic System
1. Definition of
Liberal Economic System
Liberal economic system
is an economic system that calls for the widest possible freedom for
individuals to carry out economic activities without government interference.
Freedom broadest role in economic activity, meaning that it affects the
economic activities of society. Every individual has the freedom to try and
have the object, either in the form of capital as well as objects of
consumption.
Liberal economic
system of capitalism that grows with a free capitalist economic system Endeavor. Economic system that gives the freedom
referred to as "laissez faire" (in French), which means
"let". This flow figures include Adam Smith. Countries that embrace the liberal
economic system, among others, the United States, Britain, France, Canada,
Switzerland and Japan.
2. Characteristics
of Economic System Liberal
- The government does not intervene directly in economic activities.
- The freedom of the private sector or the public to commit acts of economic (producing goods, pricing, etc.).
- The freedom to be competitive in the business world.
- Capital plays an important role in economic activity.
- The freedom to have or capital goods production equipment.
- Freedom has baranag wealth and consumption.
- Economic activities carried out with the purpose of seeking profit.
C.
Centralized Economic System
1. Definition of
Centralized Economic System
Economic system is a
centralized economic system in which the government holds the key or dominant
in the regulation of economic activity. The dominance through restrictions on
economic activities carried out by members of the public. In the centralized
economic system, people do not have freedom in performing activities of
production, distribution and consumption. Countries that embrace the
centralized economic system, such as China, Russia, Romania, Cuba, and the
countries of Eastern Europe.
2. Characteristics
of Centralized Economic System
- Economic planning, good production, distribution, and consumption and the prices are set by the government (Central Planning).
- Economic resources and means of production controlled by the government.
- Freedom induvidu the company does not exist.
- Private individuals have rights or not recognized.
- This type of work and the division of labor is regulated by the government.
D. Mixed
Economic System
1. Definition of
Mixed Economic System
Mixed Economic
System adlah economic system that requires economic activity is handled by way
of cooperation between the government and private sectors. In this system, the
private sector and governments alike acknowledged its existence.
Troubleshooting economy regarding what items will be produced and how many, are
handled jointly between the government and private sectors. Mixed economic
system is a blend of liberal economic system and centralized, so that the mixed
economic system is expected to achieve efficiency, equity, justice and economic
development and to protect the domestic economy. The economic system is widely
used by developing countries.
2. Characteristics
of Mixed Economic Openness
- Vital economic activities and dominate the life of the people controlled by the state.
- Economic activities which are run by the private sector is limited, namely in fields that are not dominate the life of many people.
- Mechanisms of economic activity that occurred in the market there is government intervention in order to avoid competition and harming each other.
- The government's role is to encourage, guide, and supervise and provide assistance to the private sector in the economy.
- Individuals or private property rights are recognized, but its use must not conflict with the interests of the people.
Well, so is this
post about the economic system on the label of social sciences. Hopefully
useful knowledge that exists in this post, if there are additional lets loaded
in the comments field. You can also vent steam about this post you guys there.
Thank you for visiting this humble blog of knowledge. Please keep
walyeducation.blogspot.com (Science Lovers).
