Capitalism is a pure market economy, while socialism, or a command economy, involves government ownership and control. Mixed economies combine aspects of both systems.
Capitalism is the term used to describe a pure market economy where resources are owned by private individuals, and economic decisions are made by market forces based on supply and demand. In contrast, a socialist economy, also known as a command economy, is where the government owns the resources and centrally plans economic activities.
Market capitalism allows for individual freedom in decision-making and ownership, while command socialism focuses on government control and allocation of resources based on societal needs.
Between these two extremes lie mixed economies, which blend elements of both market capitalism and command socialism, offering a combination of private and government ownership in resource allocation.
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