2. DEFINITION
A market economy is an economic system
where decisions regarding investment,
production, and distribution are based on the
interplay of supply and demand, which
determines the prices of goods and services.
3. CHARACTERISTICS OF MARKET
ECONOMIC
Private property
Freedom of choice
Motive of self interst
Competition
System of markets and prices
Limited government
4. ADVANTAGE
Most people work harder (the threat of losing one's job is a
great motivator).
Foreign investment is attracted as word gets out about the
new opportunities for earning profit.
A great variety of consumer goods become available for
those who have the money to buy them.
There is more innovation as firms look for new products to
sell and cheaper ways to do their work.
5. DISADVANTAGE
Growing unemployment.
The same market experiences develop a set of anti-social
attitudes and emotions.
Reduced social benefits and welfare .
Increase in corruption in all sectors of society, which further
increases the power of those with a lot of money and puts
those without the money to bribe officials at a severe
disadvantage.