Planned economy

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the term planned economy a kind of managing, with which is in advance determined, describes which summed up needs within the planningExists restaurant economics or is to expect, what for the covering of these needs at expenditures (production, etc.) it is necessary and like these are meaningfully organized. The planned economy stands thereby contrary to the free-market economy, into the different participant in the economy without previous tuning goodswith the goal produce of exchanging these on a market without the need for a property is determined exactly. In the case of the free-market economy thus no requirement planning takes place, but the control is made by the mechanisms of the market .

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is falsely used the term planned economy often as synonym for the economic system of the central administration economy of socialist states, although this represents only one form of the planned economy. Due to east west conflict handling is often ideologically affected with the planned economy.

Problematiceven if the demarcation is to the free-market economy, since in in many states with free market economic system elements of the planned economy exist, which the mechanisms of the market set repealed, so none „pure “free-market economy exists. In the European Union states e.g. in the form of subsidiesfor agriculture and mining industry.

history of the planned economy

ways of the efficiency advantage of functioning planning became - e.g. of Platon in its state drafts, of Thomas Morus alias Thomas More in its Utopia, of Jean Jacques Rousseau in its up Or by Karl Marx with its drafts of a communist society only suggested (by it) - again and again suggested articles of association based state drafts organizing also larger societies/states or the “world company” as a whole planned-economy thus also their common need, thoseTo determine production and the organization and allocation of the whole in advance, whereby this advance planning either (for instance with Karl Marx) a common act of all society participants or however (for instance with Platon) the task of national institutions and/or. particularly responsible person personsto be should.

measured variables of the planned economy

means of production

trailer marxism see the main condition for a planned economy in the joint property at means of production, since individual owners of means of production stand in the conflict with their economic Eigeninterressen.

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System of government

the planned economy is not bound to a system of government, however individual systems of government favour the choice of the planned economy as joint economic system, as well as development into a central or decentralized planned economy. For the planned economy communities are favourable in those inhigh measure of agreement between the members over the economic and political development exists and in which the standard of living is to a large extent identical. Also the existence of an influential authority increases the occurrence of the planned economy. With ascending state ratio more favorable operations exist:

economic development

two conditions can be regarded as particularly favourable:

particularly low Entwicklungsstufe (developing countries)

due to the concentration upfew goods (e.g. ) These can be offered to food, furniture, clothes by efficient planning independently of fluctuations of the market. Since few goods are produced, a small number at measured variables facilitates planning. The lack of complex goods is insignificant, there priorityBasic needs to secure are.

particularly high Entwicklungsstufe

due to the small scarceness of goods can secure the planned economy a fair distribution of the goods. Artificial Verknappungen by free market acting of individual restaurant subjects is avoided.

foreign policy

there onePlanned economy for the import and export of goods with the foreign country, affects free market disturbances negatively such as speculations with goods the planned economy is dependent on prognosticatable quantities. A foreign trade with likewise planned-economy organized countries to constant quantity definitions is more favorable. In the casefrom conflicts states organize their wartime economy often planned-economy, since a free market for weapons causes a high Gleichgewichtspreis, high public expenditures required and/or. a lack of weapons produces.

value storage means

the planned economy does not need compellingly value storage means for examplein the form of money, since no compelling necessity exists for an exchange of goods. The distribution of goods can take place alone via a regular dispatching or via the free use of the goods.

forms of the planned economy

central administration economy (central planned economy)

a typical example of a central administered economic system was the central administration economy of the USSR and other states of so-called material socialism. Substantial characteristics of the economy of these states were the nationalization of most means of production (with exception of theMajority of the agricultural effective area), the central controlling of the restaurant process, the definition of prices and wages and a sturdy foreign trade monopoly. Although this economic system was based on an ideology Marxist Leninistic calling, the central administration economy carried out one instead of the marxschen common planning of free society subjectsnationally institutionalized control by special functionaries, in accordance with their special interests (expansion of production and competitive power on the world market - to the safety device of the own privileges). Thus the results of planning were distorted and did not correspond not to the needs of the population.

See alsoMajor item central administration economy.

decentralized planned economy

in a decentralized planned economy is appropriate the responsibility for the requirement planning solely responsible with each individual restaurant unit. This need is co-ordinated with the other restaurant units, which specify so their production.

Such a advance planning ofNeed and production find whole naturally both in “before-civilized” societies (kinships, village communities,…) and in the interior relationship actually each enterprise instead of; the latter, because an internal unplanned exchange (thus an internal free-market economy) to production products more numerously in the long run not inquired andServices would lead, while at the same time on a covering lacking of actual need would be to be counted - evenly because of missing common planning. A functioning planning increases thus the efficiency of managing.

pro and cons of the planned economy

preface: Inthe practice of a planned economy not all advantages must and/or. Disadvantages arise.

advantages for the majority of the population

efficiency of managing

the economy it is organized in such a way that the needs of the majority of the population, among them alsothe need after possibility for employment with appropriate remuneration, to be satisfied. Primarily such goods are produced, for which a politically weighted need was determined; existing means of production are better used. Technical developments are coordinated, minimized Parallel-Entwicklungen.


by planningalso in economical yardstick the quantity of a property in the future the available is well-known.

distribution of goods

the distribution of the goods can be determined by planning. The attention of a multiplicity at criteria is possible (economicalally, socially, politically etc.). Thuse.g. is. the purposeful creation of means of production or the development of a certain region or a city well controllable, in addition, the supply the public interest serving goods and/or. Goods of the basic need.


criticism at planned-economy concepts cameamong other things by Ludwig of bad.

future of the planned economy

by the employment of EDP is possible a substantially better organization of a planned economy. Ever more complex products with a rising number at components and high development costs become the necessitya need planning increase.


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