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In the Section 1 Inquiry, you explored the metaphor of the untamed wild, a game reserve, and a zoo as economic environments.

The command economy at the far left of the economic continuum (shown below) is a government-controlled economy - much like the zoo where the animals are totally dependent on the zoo keepers to provide their basic needs and to make most of the decisions. The zoo keepers' decisions impact and maintain the animals' quality of life. In a command economy, the government makes the decisions about the production and distribution of goods and services, and consumers have very little to no influence on these economic decisions.

On the far right of the economic continuum is the untamed wild where it is "survival of the fittest" for these animals. The animals must provide food, shelter, and protection for themselves. If they are not able to provide what they need, they will not survive. In a true market economy, government does not intervene. Individuals (or privately-owned corporations) make economic decisions about the production and distribution of goods and services. In economic decisions, the individual's values and beliefs determine ultimately the individual's quality of life.

The game reserve is in the middle of the continuum. Animals are protected to some degree, but they are allowed to roam freely. In a mixed economy, some government decision-making is involved in the production and distribution of goods and services. However, economic freedom allows individuals (or privately-owned corporations) to make independent decisions.Therefore, the government and the individual both determine quality of life.

Mixed economic systems and market economic systems are the two most common economic systems in the world. At one time, the command or planned economic system was much more common and was a strong influence on the world's economy. China was once a command economy, but it has shifted toward a more mixed economy.

market economy: an economic system in which individuals are free to make their own decisions with little or no intervention from the government and where resources are the private property of persons or companies

mixed economy: an economic system in which both the public and the private sectors have significant roles in the economy and where some resources are owned by the private sector and some are owned by the public sector

command or planned economy: an economic system in which resources are publicly-owned (that is, owned and controlled by the government and paid for by taxes) and the government makes decisions on how to use the resources

 Vocabulary

Now, retrieve your Issues for Canadians Definitions handout from your Activities folder.

Add the terms market economy, mixed economy, and command economy, and write a definition for each word.

Provide examples from this activity to help you remember the definitions.

Save your updated handout to your Activities folder.

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