Essay On Socialist Economy

Socialist and Capitalist Economy

Economy is an entire process and network, through which goods and services are exchanged in a country or state; and the system of production, allocation of resources, distribution and exchange of goods and services is called economic system. Moreover, the relation and condition to use resources for production and trade with law, custom, and government of a country is called political economy. However; under political-economic systems, various types of economic systems have influenced, such as capitalism, socialism, communism and so forth. Capitalist and socialist economies are the most common economic systems in the world, where their major differences are in the economic equality and the role of government;

The main motive and purpose of this system is gaining personal profit. hence, all the resources are used to their optimum level and there is less wastage of goods. Since the sole purpose is profit, there is less public welfare activities in capitalism. Whereas in socialism, there is no freedom of occupation and every person is provided a job by the state. Unlike capitalism, in socialism the primary objective is equal distribution of national income. There is greater welfare than capitalism because all the citizen work for the state and the earned profit is utilized in covering all aspects of economy as providing: free education, public health facilities, security, economic development activities, and so forth. (In-text citation

In capitalism, consumer is known as the king of the market. Every producer gives attention and importance to consumers’ taste, demand and preference. Thereby, there are large variety of goods and services for the consumer. These variety of goods within the reach of all sections of the society results in rise in the standard of living. Relatively, there is loss of consumers’ sovereignty in socialist economy because goods are produced by the state decision not by consumer demand. Therefore, consumers do not have the privilege to buy or consume whatever commodity they want. They only have the choice to consume the commodities that are produced by the