Another drawback is the uneven

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Developing countries such as Bangladesh, Haiti, and (to some extent ) Brazil all follow this type of economic system. That is, all societies begin with traditional economic systems. While the traditional economy has many benefits, including no surpluses and minimal threats to the environment, it is not without its drawbacks. Since people follow existing traditions, economic growth is entirely dependent on population growth, which may be small. Furthermore, there was little access to technology and no scientific development.

Overall, self-sufficiency drives this economy, with traditions and beliefs taking Email Marketing List precedence over everything else. Market Economic System A A market economic system, also known as a free market system or a laissez-faire economy, involves minimal government intervention or control. Instead, sellers and consumers determine the price and quantity of goods and services produced. Businesses produce goods based on consumer demand. In other words, the products people want most will be those produced to satisfy that need.



After all, companies want to invest in products that generate profits. When the supply of a product is low and demand is high, its price will rise; when the opposite occurs, the price will fall. Market-based systems offer several advantages. For example, competition among businesses encourages innovation, which helps stimulate economic growth and improve customer satisfaction. Unfortunately, market economies hinder social welfare because self-interest or profit motives drive the system. distribution of income, with the rich getting richer and the poor getting poorer.