Group 4 ' (Economic System) FINAL

Economic System
Group Members
Asib Bin Absar 2004110110119
Shuvo Barua 2004110110120
Osman Goni 2004110110129
Ikram Ahmed Chowdhury 2004110110132
Absar Zaman Babu 2004110110138

Contents
 Introduction
.
 Capitalism at is Capitalism
 Advantages of Capitalist
Economy
 Disadvantages of Capitalist
Economy
 Socialist Economy
 Mixed Economy
 Demerits of a mixed Economy
 Bangladesh Economy: An
overview
 Conclusion
What is economy system
The method used by a society to produce and distribute goods

and services.
Imagine for a new car. Easy, right? Not necessarily! This

presentation explores how economic systems influence car
buying decisions, both in the US and abroad.
Types of Economy
An economy might be designed to depend exclusively

either on the market or on government to make the
three fundamental decisions of what, how and for
whom. The economic system can be broadly categorized
into
• Capitalism
• Socialism
• Mixed market
Capitalism at its Core
 Private Ownership: Businesses control the factors of production (land,

labor, capital, entrepreneurship).
 Market-Driven: Supply and demand dictate what gets produced and at
what price (free market).
 Profit Motive: Businesses aim to make a profit by selling goods and
services at a higher price than production costs.
 Limited Government: Minimal government intervention allows
businesses to operate freely (ideally).
 Origins: Emerged in 18th century England during the Industrial
Revolution
Capitalism: Boom or Bust?
Capitalism is a complex system with both advantages and disadvantages
Advantages
 Efficiency: Competition drives businesses to meet consumer demand, reducing
waste and encouraging efficient production methods.
 Innovation: The profit motive incentivizes companies to develop new products and
services, fostering constant improvement.
 Consumer Choice: Competition leads to a wider variety of goods and services at
competitive prices.
 Reduced Government Intervention: Less bureaucracy allows businesses to operate
more freely and adapt to changing markets.
Disadvantages
 Income Inequality: Capitalism can lead to wealth concentrating in the hands of a
few, while others struggle.
 Monopolies: Powerful firms can limit competition, harming consumers and
workers.
 Environmental Issues: The focus on profit can lead to overuse of resources and
environmental damage
Core Principles of a Socialist Economy
 State Ownership: The government (state) owns and controls the

factors of production (land, labor, capital).
 Central Planning: Production decisions are made by the
government based on societal needs, not market forces.
 Equal Distribution: The goal is to provide for all citizens' basic
needs, promoting social equality.
 Limited Private Enterprise: Private businesses may exist, but
their role is restricted.
 Command Economy: The government sets production quotas
and prices, minimizing market influence.
Advantages of a Socialist Economy Disadvantages of a Socialist Economy
• Reduced Inequality: Socialist economies aim  Lower Efficiency: Central planning can
to distribute wealth more evenly, reducing be slow and inefficient, leading to
poverty and income gaps shortages or surpluses of goods.
 Lack of Innovation: Reduced
• Social Welfare: Socialist systems often competition can stifle innovation and
provide comprehensive social programs like technological advancement.
guaranteed healthcare and education.  Limited Consumer Choice: Consumers
may have fewer choices and potentially
• Economic Stability: Central planning can lower quality goods due to a lack of
help avoid economic booms and busts market competition.
associated with capitalism.  Individual Freedom: Socialist economies
can limit individual economic freedoms
• Focus on Public Goods: Socialist economies and entrepreneurial opportunities.
prioritize essential public services like
infrastructure and transportation
Mixed Economy
 Combines elements of market economies and

command economies:
o Price mechanism drives markets
o Government central planning and oversight
 Means of production:
o Owned by both private companies and the state
 Market forces:
o Determine price, demand, and supply
 Government intervention:
o Prevents monopolization and discrimination
 Goals:
o Address shortcomings of pure capitalism and socialism
o Promote economic opportunity and social welfare
Advantages of a Mixed Economy Disadvantages of a Mixed Economy
 Economic Freedom: Citizens enjoy the  Potential for Government Overreach:

freedom to own property and choose the Excessive regulation or inefficient
goods and services they consume. bureaucracy can stifle economic activity.
 Innovation and Growth: Private  Income Inequality: The system may not
ownership incentivizes businesses to automatically ensure equitable distribution
compete, innovate, and contribute to capital of wealth.
formation within the economy.  Balancing Act: Striking the right balance
 Efficient Resource Allocation: The price between market forces and government
mechanism helps guide resources towards intervention can be challenging.
their most valuable uses.  Focus on Profitability: Social welfare
 Targeted Growth: Central economic programs may be limited compared to
planning can supplement market forces to purely socialist economies.
steer the economy in desired directions.
 Healthy Competition: Government
oversight fosters fair competition, preventing
both cutthroat tactics and monopolies.
Bangladesh Economy Overview
 Location: South Asia, population Strengths Challenges

of 165 million
 Economic System: Mixed
 Self-sufficient in rice production  Agriculture: Inadequate
economy (private & public sectors)
 Reliance: Agriculture sector  Significant agricultural exports infrastructure, limited credit, natural
(jute, etc.) disasters, climate change
 Growing manufacturing sector  Manufacturing: Low productivity,
 Garment industry (80% of export infrastructure issues, lack of skilled
earnings) labor, vulnerable to external shocks
 Expanding service sector  Services: Lack of skilled labor,
(banking, IT, etc.) infrastructure limitations, credit access,
 Trade surplus vulnerable to external shocks
 Infrastructure: Deficiencies in
transportation, energy, water supply
(funding, corruption, bureaucracy)
 Trade: Reliant on few exports, limited
market access, infrastructure hurdles
Thank You

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Economic System

Asib Bin Absar 2004110110119

Shuvo Barua 2004110110120

Osman Goni 2004110110129

Ikram Ahmed Chowdhury 2004110110132

Absar Zaman Babu 2004110110138

The method used by a society to produce and distribute goods

Imagine for a new car. Easy, right? Not necessarily! This

An economy might be designed to depend exclusively

 Private Ownership: Businesses control the factors of production (land,

 State Ownership: The government (state) owns and controls the

 Combines elements of market economies and

 Economic Freedom: Citizens enjoy the  Potential for Government Overreach:

 Location: South Asia, population Strengths Challenges

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