Economic Systems Theory

Economic Systems Theory explores how societies organize the production, distribution, and consumption of goods and services. It examines different approaches—such as capitalism, socialism, and mixed economies—each with unique roles for government, private enterprise, and individuals. The theory analyzes how these systems influence resource allocation, income distribution, and economic efficiency. By understanding their structures and functions, we can better grasp how societies meet the needs and wants of their populations, manage scarcity, and adapt to changes over time. Essentially, it provides a framework for comparing how different economies operate and achieve national economic goals.