What are basic characteristics of command economies?


Quick Answer

The main characteristics of command economies include public ownership of production, governmental regulations on businesses and industries and government-established production goals. Command economies, also called centralized economies, centrally planned economies or planned economies, function as government units. These types of economies feature governmental control and regulation across virtually every aspect of economic activity, including volume of production and allocation of raw goods and materials.

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What are basic characteristics of command economies?
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Full Answer

Government oversight of economic activity generally occurs at the federal or national level. Central governments use political reasoning to make economic decisions, such as evaluating the total amount of products used for long-term investments versus consumption. They establish macro objectives for economies, such as reducing unemployment and items produced. In command economies, consumers have little impact on economic activity and make decisions only on products consumed.

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