What is the difference between a market economy and a command economy

What is the difference between a market economy and a command economy Introduction: Unveiling the Economic Paradigms Hello everyone, and welcome to today's discussion. When it comes to economic systems, two prominent models have shaped the world's economies: the market economy and the command economy. While both have their merits, they differ significantly in their approach and outcomes. In this video, we'll explore these distinctions, shedding light on how they impact societies and businesses. Market Economy: The Invisible Hand at Work Let's begin with the market economy. At its core, this system relies on the forces of supply and demand to determine prices, production, and resource allocation. It operates on the principle of individual freedom, where businesses and consumers make decisions based on self-interest. In this environment, competition thrives, leading to innovation, efficiency, and a wide array of choices for consumers. The market economy is often associated with capitalism, where private ownership and profit maximization are key drivers. Command Economy: Centralized Control and Planning In contrast, the command economy is characterized by centralized control. Here, the government or a central authority dictates production levels, resource allocation, and prices.