Mixed Economic System | Characteristics of Mixed Economy

Mixed Economic System

The economy in which individual ownership and private enterprise exist side by side with state enterprise and control is known as a mixed economy. That is, in this economic system, private and state enterprises play a combined role. In most of the countries of the world, mixed economy exists for example, the United States, the United Kingdom, Germany, Bangladesh, India, etc.

Characteristics of a Mixed Economy

In different countries of the world, the characteristics of a mixed economy are of different kinds. Usually, the following characteristics of a mixed economy are observed:

The Private Co-operative and State Ownership of Resources: In a mixed economy an individual can freely possess and enjoy his/her movable and immovable properties and also can trade those off. Side by side with that, the government runs the institutions that provide public properties (highways) and services (healthcare).

Private Enterprise: In a mixed economy, most of the economic activities along with production, trading, distribution, and consumption, are organized and conducted by private enterprises.

State Enterprise: In a mixed economy, state enterprises are undertaken alongside private enterprises. The vital and heavy industries, national security, and institutions that are significantly public-related are conducted by the state.

Profit: It is possible to earn profiles by conducting maximum economic activities in the private sector.

Freedom of the Consumer: In this system, the consumer enjoys full freedom regarding the trading and consumption of general products. However, if the government deems it necessary, it can influence the price of the goods and control the production and consumption of any goods as per their necessity, for example, smoking, production of drugs and consumption, etc.

Many people consider this mixed economy as a better economic system since pure capitalism or socialism can be found nowhere in the world. In this system, private and public sectors remain side by side. For this reason, besides individual freedom government's control remains in the field of production, exchange, distribution, and consumption.