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What are some characteristics of a mixed economy?

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Quick Answer

Since a mixed economy includes a mix of both private and government control, it reflects characteristics of both capitalism and socialism. The balance between the two ideals can vary greatly between countries, sometimes leading to a lack of consensus on whether the economy is capitalist, socialist or mixed.

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Full Answer

A mixed economy typically offers a variety of freedoms, including the freedom to own the means of production, participate in managerial decisions, travel freely, buy and sell, hire and fire employees, and organize, communicate and protest peacefully. These freedoms exist alongside elements of what are widely considered socialist elements, such as state-owned means of production and infrastructure as well as public services, widespread distribution of welfare and transfer payments. The freedoms of a mixed economy are also accompanied by a multitude of laws and regulations affecting individuals and businesses alike.

Most of the world's major economies are considered mixed economies. The appropriate level of governmental control depends on the priorities and will of the people. Most governments have a command role in defense, international trade and national transportation. Some mixed economies encourage the government to centrally manage health care services, welfare and retirement programs, while others prefer to leave these areas open to the free market. The ultimate goal of a mixed economy is to enjoy all the benefits of a capitalistic, market-based economy while still allowing for a strong government to provide a safety net and manage national resources.

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