In a Communist economy, the government owns most of the means of production and will determine the allocation and provision of resources, products and services. In practice, this has led to the diversion of economic resources from the people, or consumers, to the industrial and military sectors.Continue Reading
Another key characteristic of communist economies is an insistence on national self-reliance. Few communist states have been comfortable with international trade and investment.
Communism as a political theory and system was developed by Karl Marx and Frederick Engels in the 19th century. They rejected the principle of private ownership, which they considered a motivation for greed and competition. They also sought to return control of the economy to the people (or proletariat). The transition from capitalism to communism was to be led by the communist government, which would act as an economic steward on behalf of the people. Despite the noble aims of Marx and Engels, it has been far too easy for corrupt governments to abuse this transitional stewardship and exploit the people they are meant to serve.Learn more about Types of Government