What is the role of the government in a command economy?

Economics Command Economy Questions



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What is the role of the government in a command economy?

In a command economy, the government has a central role in making economic decisions and controlling the allocation of resources. It determines what goods and services are produced, how they are produced, and who receives them. The government also sets production targets, determines prices, and regulates the distribution of goods and services. Additionally, it may own and operate key industries and control the means of production. The main objective of the government in a command economy is to promote social welfare and achieve specific economic goals, often prioritizing collective interests over individual preferences.