a market economy definition
market economy definition. An economy in which the greater part of production, distribution, and exchange is controlled by individuals and privately owned corporations rather than by the government, and in which government interference in the market is minimal. Also called free market economy. Compare command economy. The difference is this: a market economy is a tool--a valuable tool--for organizing productive activity. The same is true for the market economy: the power of markets, for good and for evil, is enormous. Some argue that when the free market fails to protect consumers, government regulation is required. Markets. Free enterprise is the economic term used to describe an economy with very little government ownership or regulation. In a free enterprise system, competition and the preferences and choices ... Also called free economy, free market, or free market economy. See also open economy. Competition by companies to obtain your business helps to create products that consumers want to buy and this is one of the fundamentals of a market economy. An economy that operates by voluntary exchange in a free market and is not planned or controlled by a central authority; a capitalistic economy. Also called free economy, free market, or free market economy. See also open economy. Use market economy in a sentence. Competition by companies to obtain your business helps to create products that consumers want to buy and this is one of the fundamentals of a market economy. 20 people found this helpful. market economy in Culture Expand. An economy in which the greater part of production, distribution, and exchange is controlled by individuals and privately owned corporations rather than by the government, and in which government interference in the market is minimal. What is a 'Free Market'. The free market is a summary description of all voluntary exchanges that take place in a given economic environment. Free markets are characterized by a spontaneous and decentralized order of arrangements through which individuals make economic decisions. The term “free market” is sometimes used as a synonym for laissez-faire capitalism. When most people discuss the “free market,” they mean an economy with unobstructed competition and only private transactions between buyers and sellers. However, a more inclusive definition should include any voluntary economic activity so long as it is not controlled by coercive central authorities. Some philosophers have advocated for a laissez-faire system of economy where the government retains a hands off approach to regulating the economy, however realistically, in a system using the market economy, the government does play some role in regulation.
An economy in which the greater part of production, distribution and exchange is controlled by individuals and privately owned corporations rather than by the government and in which government interference in the market is minimal.