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The Command Economy

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Adam Hofmann

on 15 October 2011

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Transcript of The Command Economy

The Command Economy The Five Economic Questions Who produces goods
and services? In a command
economy, production
and distrubition are
directed by a small group
of people who form a
goverment If a group of people
are making food
for a bake sale and one
person takes over it
is a command economy.
This person makes all
the desicons, while the rest
of the group follows A person or party
dictates for the entire nation
and everyone else must obey
or face the consequencs Will this
economy work What goods and
services are produced? For example In countries
with a command
economy In a command economy,
alot of money goes towards goods
like military investments, and not
alot of money goes towards services
like social services Statisticly, Command economy's use
about 2-3 times more % of their
GDP on miltiary spending
then educational spending This means, That mostly military goods will be produced and services like education may not be produced as much. In a command economy, both types
of production methods are used,
assembly line technique and
production team method. How are goods and
services produced? Assembly line
technique In this techinque, an item
is passed along a line
where at each station a
part or group of parts are
added. This would benefit a
command economy in
the product is cheaper and
almost anyone can afford
the supplies cheap and
would supply more jobs
almost anyone could do Production team
method In this technique a group
of skilled people make the
item adding most or all parts.
This would be utilized in a
command economy because,
the people higher in the government
would pay more and demand
this be made, and people
who work hard enough and
get the education can make
more money. For whom are goods
and services produced? In a command economy, goods and
services are produced for different people. Goods are
produced for Everyone in a command economy
recieves goods. the higher quality
goods are given to people
who posses more power
or money and
lower quality goods will be given
to people with less money or power Services are
done for Almost everyone in
command economys will
recieve services. the only
exception maybe if someone
cannot afford it.
How are goods and
services distrubited? In a command economy, goods are ussually evenly distributed
throught the community. The only exception would be if the leader commands them not to be Some people in a
command economy
produce services. Although this is a smaller
portion, almost all of these
cost money because health care
is ussually not free. As with
goods the general population
produces services. These are usually
done by Convientinal methods such as
truck transport or sometimes
ships or planes Services are
distrubted, In that it will cost
money to recieve
almost every service
such as health care.
But as long as you have
money you can recieve
almost every service What is a command
economy? Some command
economys are
military dictatorships In a military dictatorships
the government is controlled
by the military. In military dictatorships
there is not much
chance for education
or health care This is because most money is spent on military spendings and not social services although there is some exceptions Here is a chart showing
the military spending of
GDP (%) comapared to
eductaional spending
of GDP (%) Countries Military spending (% of GDP) Education spending (% of GDP) Angola Brunei Eritrea Yemen 21.2 7.6 5.2 22.9 3.0 4.0 5.0 7.0 Burundi 5.4 4.0 As you can see some countries like Angola or Eritrea spend large amounts on military and a fraction of that on educational Meanwhile, countries like Yemen spend more on education than military spending. And, some countries like Brunei and Burundi have a closer balance of military and educational spending Of course these are all command economys. Cuba is an excellent
example of a
command economy. For example, the government decides what to produce and how to distribute goods and services. But as a result many individuals lack freedoms and choices Also, Cubans must live with only basic necessities and deal with shortages, however the government provides free education daycare and health care for all cubans, this results in over 95% of cubans being literate today. General society leader Where are command
economies? Some command economys you may recongnize include, China, Vietnam, Cuba and North Korea In a command economy,
goods will be
produced by common
citizens, but usually the
goverment or leader do
not produce the goods
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