Centralised planning

What is the most effective way of organising an economy in order to achieve development?

Chronologically, within the last 50 years the following have been the preferred options of development economists.

Centralised planning

The following model is not a description of actual economies since economies will show variety in their details. Rather it depicts an idealised economy; the economy economists have in mind when proposing how centralised planning might operate.

Centralised planning model

It should be noted than a centrally planned economy is not necessarily a command economy like Cuba, the Soviet Union or North Korea as there is a small private sector in the economy.

Government control of resources allows the government to control and improve development.

These notes are from a lesson on 01/11/2004.

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