Types+of+Economies

** 1) ** Cooperation   In the cooperation economy it is decided cooperatively what work had to be done, how it should be done, and who should receive what part of the produce.   Early hunters and gatherers used cooperation in order to survive. We can see a newer example of a cooperation economy in New Lanark, a town founded by Robert Owen.   ** 2) ** Custom In the custom economy tradition determines who does what and who gets what part of the produce. By tradition, people do what their parents did. We can see the first example of custom economy in the European feudal society. Today, 239,778 people living on the island Vanatu demonstrate the example of custom economy. The island is considered the happiest place on Earth but is also the least developed country because there is no innovation and entrepreneurship. ** 3) ** Command   In the command economy the individuals in power decide who does what and who gets what part of the produce. In command economies there is no unemployment and no poverty but they tend to be inefficient.   We can see an example of a command economy in ancient civilizations, such as Egypt 4,000 years ago. Newer examples of command economies are: China before 1978, India before 1991, North Korea and Cuba.   ** 4) ** Competition In the competition economy the powers of demand and supply determine who does what and who gets what part of the produce. The producers decide what to produce based on the demand and the buyers decide who gets what based on their ability and willingness to buy. In perfectly competitive economies there is no government intervention (Laissez Faire – “Let it be”). Most economies today are a combination of command and competition because they rely on the powers of demand and supply but have a certain amount of government intervention.
 * Types of Economies **

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