2.3 Economic Systems. Types of economic systems

System - a set of components and parts in relation to each other, forming the integrity, unity. The system is not part of the main, not the elements themselves, and their interaction, relationship, relationship with each other. Systems have many forms. With all the diversity, all systems can be divided into three types:

• technology;

• biological;

• social.

However, the processes of technological and biological systems are in accordance with objective laws, and only superficially similar to the social system, characterized by the fact that they have no trust units have no result, not foreseen by anyone. It's more comprehensive regulation under the influence of the laws of nature.

Economic system - the set of all economic processes taking place in society based on the established therein property relations and the economic mechanism. In any economic system plays a primary role in the production together with the distribution, exchange, consumption. All economic systems are required for the production of economic resources, and results of operations are distributed, exchanged and consumed. At the same time, the economies are also the elements that distinguish them from each other:

• socio-economic relations;

• organizational and legal forms of business;

• economic mechanism;

• a system of incentives and motivations of the participants;

• economic relations between enterprises and organizations.

The basic types of economic systems: - traditional;

- command and administration;

- the market;

- mixed.

1. The traditional economic system

In underdeveloped countries, there is the traditional economic system. This type of economic system is based on the backward technology, widespread dissemination of manual labor. The economy is based on tradition, passed down from generation to generation. Stored in a number of community-based natural-form, community-based economic management and in-kind distribution of the created product. Of great importance is small-scale production. It is based on private ownership of productive resources, and personal labor of its owner. In countries with a traditional system of small-scale production is represented by numerous peasant and artisan farms that dominate the economy. In the relatively underdeveloped domestic enterprise a huge role in the economy of the countries in question are often played by foreign capital.

Distinguishing Features:

• a very primitive technology;

• prevalence of manual labor;

• production, distribution and exchange are based on customs, traditions and religious rituals;

• organization and management of economic life is based on the decisions of the Board oldest;

• traditions determine what goods and services to produce, for whom and how;

• the economic role of the members of society are determined by

eredity and caste.

The advantages of a traditional economy • stability;

• predictability;

• Q-factor and a large number of benefits.

Disadvantages of the traditional economy:

• Nowhere to external influences.

• Technological progress is sharply limited.

• Illiteracy, overcrowding, high unemployment, low labor productivity.

• Low level of economic and social development.

• Population growth rate exceeds the rate of growth of industrial production.

• Large external financial debt.

• The inability to self-improvement and progress.

Country's traditional system are suppliers of raw materials for the world economy, are market for the finished products.