Command economy

Definition

A command economy is an economic system where the government controls all aspects of production, distribution, and pricing of goods and services.

Related terms

Central planning:

The process through which authorities make decisions about resource allocation in a command economy.

State-owned enterprises (SOEs): Companies or industries that are owned and operated by the government in a command economy.

Price controls: Regulations set by the government that dictate how much certain goods or services can be sold for in order to maintain affordability for consumers.