Market Economy

By:Israel Colston

What is Market Economy?

Market Economy is basically, What the people want is what the people get, supply and demand.
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Examples Of Market Economy?

The U.S., featuring the world's most advanced financial markets, is 82% economically free. While certain U.S. industries generate more government scrutiny than others, private companies, rather than the government, control most sectors; the country also practices free trade with much of the world.
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Advantages & Disadvantages


(1) The market gives producers an incentive to produce goods that consumers want.

(2) The market provides an incentive to acquire useful skills.

(3) The price system encourages producers and consumers to conserve scarce resources.


(1) A private market economy may be quite unstable (unemployment, inflation, growth).

(2) Business may simply satisfy the wants they have created through advertising.

(3) Prices may give false or inadequate signals to producers and consumers (externalities, like pollution).