Mixed Economic System
Definition of Mixed Economic System
Mixed economy is an economic system in which the management, control, and ownership of the means of production are in the hand of both the private and public. The means of production are jointly owned by individuals and the government. Examples of countries that practice a mixed system are Nigeria, Brazil, Ghana, etc.
Features of Mixed Economic System
1. Decisions are jointly made by the government and the private, decisions of what to produce, how to produce, and for whom to produce are jointly made.
2. Both make decisions that will promote the economy
3. The public sector is to benefit the people while the private sector is to make profit.
4. Economic activities are maintained by government and private.
5. Mixed economy is characterized by capitalism but modified by government action.
Advantages of Mixed Economy
1. Government has the power to check the inequality of income and wealth
2. Existence of competition among the manufacturers and final consumers
3. It encourages private innovation and initiatives
4. It boost economic growth and development
5. There is an existence of consumer sovereignty (provision of alternative choice)
Disadvantages of Mixed Economy
1. The interference of government often affects the price system
2. Government has the power to increase taxation unnecessarily
3. The level of government intervention may be a major disagreement
4. It may encourage exploitation of the people
5. Inequality of income may also occur
1. What is an economic system?
2. Explain any four features of socialism
3. List and explain three advantages and two disadvantages of capitalist economic system.View Answer