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Comparative Analysis of Economic Systems: Vietnam, Finland, Australia

This report provides insights on command, mixed, and market economies in Vietnam, Finland, and Australia, highlighting resource allocation, growth rates, unemployment, and government intervention. Explore the impacts of different economic structures on inflation, efficiency, and competition.

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Comparative Analysis of Economic Systems: Vietnam, Finland, Australia

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  1. Econ System Report By Grace Yun

  2. Command Economy - Vietnam • State determines resource allocation • Doesn’t always make the right choice – poor management • Economy experienced rapid growth • Slowed down – recently at 4% growth • Inefficient state enterprises • Approaching bankruptcy • High inflation rate – 12%

  3. Mixed Economy (European socialism) - Finland • Unemployment has been decreasing • Small GDP deficit • Approximately 1% • There are private enterprises • Example: Nokia • Loss of competition • Led to increase in costs and decrease in exports

  4. Market Economy - AUstralia • Improving GDP growth rate • 4.3% higher in 2012 than 2011 • Effective coordination within economy • “Strongest economy in the developed world” • Low unemployment rate • 5.2%

  5. Comparison – command & Mixed

  6. Comparison – Command & Market

  7. Comparison – Market & Mixed

  8. Overall comparison • SIMILARITIES: all three economies have producers, suppliers, goods, services, price, and income. They can also all have low unemployment rates and face limited competition. • DIFFERENCES: the level of government intervention in the market is the factor that changes in the three economies – this influences incentives to be efficient. The less moral hazards there are, the more efficient companies try to be.

  9. Command Economy - Vietnam

  10. Continued - Vietnam • ABILITY TO ALLOCATE RESOURCES EFFECTIVELY: • In theory, Vietnam values equality over efficiency – meaning that in command economies the the allocation of resources is not very effective; • This is apparent in the 12% inflation rate and also by the fact that numerous companies are close to being insolvent

  11. Mixed economy (european socialism) - Finland

  12. Continued - Finland • ABILITY TO ALLOCATE RESOURCES EFFECTIVELY: • In theory, there should be a balance between equality and efficiency in mixed economies – as Finland is more command-leaning, equality would be prioritized; • Resource allocation is very effective – i.e. schools are able to provide free meals, health care, and counseling to their students

  13. Market Economy - Australia

  14. ConTinued - Australia • ABILITY TO ALLOCATE RESOURCES EFFECTIVELY: • In theory, because individuals are able to act according to their self-interest, resources should be allocated effectively, with each person trading something to get what he/she wants; • This is manifest in the way that the government has been able to increase spendings in a variety of areas such as food, health, education, and transportation. • It is also shown in the salary increases that many companies granted to their workers

  15. Thank YOU

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