Economic systems are one of the most important that every society needs to develop in each country. Economic systems are an organized way in which a nation allocates its resources and distribute fairly their goods and services in the national community. There are three main types of economic system in the world which are the market economy, the command economy, and the mixed economy. Each country has to decide which economic systems that they are going to practice.
ECONOMIC INFLUENCE FACTORS-THE MARKET SYSTEM
As we know, a market economy is being
practiced within the developed countries such as Hong Kong, Ireland and United
States. In market system, most of the property resources owned by private
individuals and firms. Market economy is also based on supply and demand with
little or no government intervention. The role of the government is only
limited to controlling the law and to ensure that reasonable price is charged
by the sellers to consumers. In the other words, market economy gives the
absolute power to prices in determining the allocation and distribution of
goods and services that have been provided in the country.
CONCLUSION
Practicing the market
economy is actually good as there is great competition between different firms
within the country to increased efficiency. Next, there is more innovation can
be created as firms look for new and latest products and services that can be
provided. Foreign investment also can be attracted as there are new
opportunities for them to earn profit. Furthermore, a wide variety of goods and
services are provided and become available for those who have the money to buy
them.