Command Economy And Capitalism

1 .1 Advantage of a Command EconomyA command providence can make the most of the continuous operation of the farming s sparing re citations . Proponents of this economic method cont closing curtain that the limitation of a business cycle does not apply to planned economies . This thusly enhances stability in the country by controlling unemployment and former(a) undesirable economic variables (Wkipedia 20071 .2 Drawback of a Command EconomyDue to the high centralisation that exists in a command economy , workers leave behind be less prone to innovation and growthivity . Since the premise of this economic style rests upon societal rather than individual needs the course of work to rule may arise in prevalent firms (Wkipedia 20071 .3 Advantage of a capitalist EconomyAn important feature of a capitalist economy is that of unrestricted access to markets , which increases rival . through and through a large number of sellers , economic power is easy between entrepreneurs and the invisible hand denoted by Adam smith will direct to an equilibrium price . Such characteristics will lead to greater product choice for clients and improved product quality and reasonable price . In to meet such criteria , competiting firms will thus promote efficiency and effectiveness to hold up in the market (Maunder. et al 1993 ,24 -261 .

4 Limitation of a Capitalist EconomyProminent leftist critics like Karl Marx state that due to high competition in a capitalist economy , entrepreneurs will continually strive to reduce operating costs , sometimes by tar dieing labor costs Since labor is the most basic source of value for an economy , the entrepreneurs through such measures argon withdraw their own grave . This is due to the fact that if people are unemployed , they will not have sufficient money to buy commodities that firms are selling . Therefore industrialists will end up bankrupt in the long-run due to scorn demand resulting in a limited number of companies in the industry (Maunderbr et al 1993 ,36ReferencesMaundersMyers D Wall N milling machine L . R (1993 . Economics Explained . Second Edition . Glasgow : harpist Collins PublishersWikipedia (2007 . Planned Economy . Available from http /en .wikipedia .org /wiki /Command_economy (Accessed 6th May 2007PAGEPAGE 2 of 2COMMAND AND CAPITALIST ECONOMIES...If you want to get a full essay, order it on our website: Ordercustompaper.com

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