A mixed economy is mixture of the free market system and the command system where there is a mixture of private industries and others that are publicly (government) owned. A mixed economy means that part of the economy is left to the free market and part of it is run by the government. Many mixed economies can be described as market economies with strong government oversight and the government providing some public goods. Governments in mixed economies often provide environmental protection, enforce minimum employment standards and make sure that there is free competition. They also may provide a welfare system.
The mixed system overcomes the disadvantages of both the market and planned economic systems. Most countries chose a mixed economy because these economies strongly support free market principles which make the economy competitive and efficient. An advantage of mixed economies is that the competition keeps prices low and inefficient business behavior is controlled which does not happen in a command economy. Consumers also have choice in a mixed economy whereas there is very little choice in a command economy. In mixed economies, the areas that do not make a profit but support the community are looked after by government. Mixed economies rely on the government to look after matters from education to the environment. The welfare of the people and protection of the environment is taken care of in a mixed economy whereas this could be neglected in a free market system. In the mixed system there is less income inequality than in a free market economy. The mixed economy combines the positive areas of both the free market economy and the command economy and reduces the disadvantages of both these systems. This combination of freedom and restrictions tries to ensure the maximum standard of living for the population as a whole. This is why many country adopt a mixed economy.
The mixed system overcomes the disadvantages of both the market and planned economic systems. Most countries chose a mixed economy because these economies strongly support free market principles which make the economy competitive and efficient. An advantage of mixed economies is that the competition keeps prices low and inefficient business behavior is controlled which does not happen in a command economy. Consumers also have choice in a mixed economy whereas there is very little choice in a command economy. In mixed economies, the areas that do not make a profit but support the community are looked after by government. Mixed economies rely on the government to look after matters from education to the environment. The welfare of the people and protection of the environment is taken care of in a mixed economy whereas this could be neglected in a free market system. In the mixed system there is less income inequality than in a free market economy. The mixed economy combines the positive areas of both the free market economy and the command economy and reduces the disadvantages of both these systems. This combination of freedom and restrictions tries to ensure the maximum standard of living for the population as a whole. This is why many country adopt a mixed economy.