ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -Command economy is a system where the government decides goods production, process, quantity, and price in a country. In this system, the government also manages income and investments. A communist nation like the former Soviet Union, Cuba, and North Korea work according to this system.

Detailed explanation-2: -In a true communist economy, the community makes decisions. In most communist countries, the government makes those decisions on their behalf. This system is called a command economy.

Detailed explanation-3: -Key Takeaways In a command economy, the central government dictates the level of production of goods and controls their distribution and prices. Proponents of command economies argue government control rather than private enterprise can ensure the fair distribution of goods and services.

Detailed explanation-4: -The system is a market economy with the predominance of public ownership and state-owned enterprises. The term “socialist market economy” was introduced by Jiang Zemin during the 14th National Congress of the Chinese Communist Party (CCP) in 1992 to describe the goal of China’s economic reforms.

Detailed explanation-5: -It was Karl Marx, in the Communist manifesto who argued for ‘common ownership of the means of production. ‘ A command economy works in contrast to a free market economy.