Essay Question Week One:
Economics is a social science that studies how individuals, governments, firms and nations make choices on allocating scarce resources to satisfy their unlimited wants. In simple terms, economics is the study of how wealth is generated and distributed amongst the people. There are two types of economic systems: capitalism and command economy.
Capitalism is an economic system based on a free market, open competition, profit motive and private ownership of the means of production. In layman’s terms, a person can run their company how they see fit because they own all the parts of the company. With this type of economic system, the cliché “of the people, by the people, for the people” is not a myth, but reality. In today’s society, the world famous PAPA JOHN’S PIZZA is an example of capitalism. This particular company has a CEO that is more than just paperwork and sticky notes. John Schnatter, the president, can be seen in his restaurants taking orders, making the food, delivering the food, and occasional maintenance. Papa John owns his business and runs it how he sees fit because he owns all the parts of the company. To make it even better, John has employee training to show the employees how to do exactly what he does…RUN A BUSINESS! If Papa John decides to advertise a special deal on pizza or offer a free incentive, he can do that because he is in control of the decision making process for his business, not the government.
Command Economy is a system where the government, rather than the free market, determines what goods should be produced, how much should be produced and the price at which the goods will be offered for sale. The command economy is a key feature of any communist or socialist society. Command economies are progressively becoming extinct. Currently, Saudi Arabia, Iran, Libya, and Burma have this type of trade and industry system. With this type of economy, the people are all soldiers, waiting to be told what to...
Definitions for capitalism. (2013). Retrieved October 30, 2013, from
What countries have a command economy. (2013). Retrieved November 3, 2013, from
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