Mixed Economy Systems
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Last updated 25 Sept 2020
In this short video we look at the concept of a mixed economy as a form of economic system.
An economic system is a network of organisations used to resolve what, how much, how and for whom to produce i.e. a way of addressing the basic economic problems of scarcity , sustainability and equity.
In a mixed system, some factor resources are owned by the public sector (i.e. the government or the state) and some are owned by the private sector.
What are some of the key features of a mixed economy?
- The public sector typically supplies public and merit goods
- The state also intervenes in markets to correct one or more market failures
- Nearly all economies in the world are mixed (including the UK and the USA)
- That mix changes over time as some industries are privatised (sold to the private sector) or nationalised (taken back into state ownership).