Question

Compare and contrast a traditional economy and a command economy. Make sure to address the economic questions and provide at least 1 incentive for each.

a) Traditional economies prioritize cultural values, while command economies focus on government control.
b) Traditional economies rely on market forces, while command economies are centrally planned.
c) Traditional economies emphasize individual entrepreneurship, while command economies stress collective decision-making.
d) Traditional economies encourage innovation, while command economies discourage competition.

Answer 1

A traditional economy prioritizes cultural values, while a command economy focuses on government control. Traditional economies rely on customs and traditions, while command economies are centrally planned. The incentives in a traditional economy are centered around preserving cultural heritage, while incentives in a command economy are driven by achieving societal goals set by the government.

Step-by-step explanation:

A traditional economy is based on cultural values and customs, where economic decisions are made by following traditions that have been passed down from generation to generation. In a traditional economy, there is little room for individual entrepreneurship, as the focus is on maintaining traditional practices. An incentive in a traditional economy could be the preservation of cultural heritage and identity.

On the other hand, a command economy is characterized by government control over economic decisions. In a command economy, the government determines what goods and services should be produced and how they should be distributed. The main incentive in a command economy is the achievement of societal goals that are set by the government, such as providing free healthcare or education for all citizens.