Capitalism, Planned, and Mixed Economies

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Capitalism, Planned, and Mixed Economies
Capitalism refers to an economic system where individuals and companies own capital and properties and invest to accumulate more wealth. A mixed economy allows consumers and businesses to use capital freely and own properties, but the government might intervene to regulate the market for the benefit of everyone. In a planned economy, the government determines the investment, income, prices of goods and services, and the production process. The paper focuses on the similarities and differences of capitalism, mixed, and planned economies without forgetting to give examples of different types of competition within a free market system.
Although the government intervenes to regulate the economy in a mixed economic system, individuals and businesses own properties and freely use the capital. Thus, mixed economies are not fully owned by the state, which means that companies and people can control the production of goods and services (Freeman 97). As such, a mixed economy incorporates some aspects of capitalism and socialism. The uniqueness of this type of economy is that the government controls a part of it, and the other is a free market.
The primary difference of capitalism with other market structures is that it entails an economic system where capital and properties are owned and controlled by individuals and firms. The forces of demand and supply determine the price of goods and services and their production. Additionally, capitalism involves the reinvestment of profit to generate more money. The competition among producers fosters productivity through creativity, increasing mechanization, and innovation (Perrotta 40). As such, in a capitalistic economy, only companies or individuals that invest more accumulate wealth.
In a planned economy, the state regulates and controls all activities and functions of the market, including the distribution, capital, production, labor, natural resources, and prices of goods and services. The government sets regulations that individuals and companies are supposed to follow, but it is not the sole owner of the capital (Bortni...