What are the characteristics and features of market, command and mixed economic systems?

What do you think the system that work best for globalization?
Essential characteristics of a market are as follows:
1. One commodity
In practical life, a market is understood as a place where commodities are bought
and sold at retail or wholesale price, but in economics “Market” does not refer to a
particular place as such but it refers to a market for a commodity or commodities i.e., a
wheat market, a tea market or a gold market and so on.

2. Area:
In economics, market does not refer only to a fixed location. It refers to the whole
area or region of operation of demand and supply

3. Buyers and Sellers:

To create a market for a commodity what we need is only a group of potential
sellers and potential buyers. They must be present in the market of course at different
places.

4. Perfect Competition:
In the market there must be the existence of perfect competition between buyers
and sellers. But the opinion of modern economist is that in the market the situation of
imperfect competition also exists, therefore, the existence of both is found.

5. Business relationship between Buyers and Sellers:

For a market, there must exist perfect business relationship between buyers and
sellers. They may not be physically present in the market, but the business relationship
must be carried on.

6. Perfect Knowledge of the Market:

Buyers and sellers must have perfect knowledge of the market regarding the
demand of the customers, regarding their habits, tastes, fashions etc.

7. One Price:
One and only one price be in existence in the market which is possible only
through perfect competition and not otherwise.

8. Sound Monetary System:

Sound monetary system should be prevalent in the market, it means money
exchange system, if possible, be prevalent in the market.

9. Presence of Speculators:
Presence of seculars is essential just to supply business information’s and prices prevalent
in the market.

https://www.economicsdiscussion.net/market/market-meaning-definition-and-features-
economics/13765

A command economy is an economic system where the government has control over the
production and pricing of goods and services. Sometimes called a planned economy, in a
command economy, the government decides which goods and services to produce, the
production and distribution method, and the prices of goods and services. The government is the
central planner.
KEY TAKEAWAYS

 The government has control over a command or planned economy.

 In mixed economies, the government has some control, while the rest is up to supply and
demand.
 Command economies are characterized by large surpluses and shortages, monopolies,
and prices set by the government.
  Mixed economies are characterized by corporate profitability, the use of fiscal and
monetary policies to stimulate growth, and the existence of a public and private sector.
A mixed economic system has features of both a command and a free-market system
because it is partly controlled by the government and partly based on the forces of supply and
demand. Most of the main economies in the world are now mixed economies, which operate
under a combination of socialism and capitalism, and governments in most mixed economies
use fiscal or monetary policies to stimulate growth during economic slowdowns. This may come
in the form of corporate bailouts, changes in interest rates, or other stimulus packages.
Generally, a mixed economic system includes a public and private sector. There is limited
government regulation in a mixed economy, while there is heavy government regulation and
control in a command economy. In the mixed economy, governments allow corporations to
profit, but levels of profit might be limited by taxation or by imposing tariffs.
https://www.investopedia.com/ask/answers/033015/what-difference-between-command-
economy-and-mixed-economy.asp
Research and explain the different economic institutions and market integration. Identify its
positive and negative impact in the global society.  Do these organizations have the
accountability in the problem of globalization?
a. World Trade Organization
The WTO’s creation on 1 January 1995 marked the biggest reform of international trade
since the end of the Second World War. Whereas the GATT mainly dealt with trade in
goods, the WTO and its agreements also cover trade in services and intellectual property.
The birth of the WTO also created new procedures for the settlement of disputes.
The WTO provides a forum for negotiating agreements aimed at reducing obstacles to
international trade and ensuring a level playing field for all, thus contributing to economic
growth and development. The WTO also provides a legal and institutional framework for
the implementation and monitoring of these agreements, as well as for settling disputes
arising from their interpretation and application. The current body of trade agreements
comprising the WTO consists of 16 different multilateral agreements (to which all WTO
members are parties) and two different plurilateral agreements (to which only some WTO
members are parties).
Over the past 60 years, the WTO, which was established in 1995, and its predecessor
organization the GATT have helped to create a strong and prosperous international trading
system, thereby contributing to unprecedented global economic growth. The WTO currently
has 164 members, of which 117 are developing countries or separate customs territories.
WTO activities are supported by a Secretariat of some 700 staff, led by the WTO Director-
General. The Secretariat is located in Geneva, Switzerland, and has an annual budget of
approximately CHF 200 million ($180 million, €130 million). The three official languages
of the WTO are English, French and Spanish.
Decisions in the WTO are generally taken by consensus of the entire membership. The
highest institutional body is the Ministerial Conference, which meets roughly every two
years. A General Council conducts the organization's business in the intervals between
Ministerial Conferences. Both of these bodies comprise all members. Specialised subsidiary
bodies (Councils, Committees, Sub-committees), also comprising all members, administer
and monitor the implementation by members of the various WTO agreements.
More specifically, the WTO's main activities are:
— negotiating the reduction or elimination of obstacles to trade (import tariffs, other
barriers to trade) and agreeing on rules governing the conduct of international trade (e.g.
antidumping, subsidies, product standards, etc.)
— administering and monitoring the application of the WTO's agreed rules for trade in
goods, trade in services, and trade-related intellectual property rights
— monitoring and reviewing the trade policies of our members, as well as ensuring
transparency of regional and bilateral trade agreements
— settling disputes among our members regarding the interpretation and application of
the agreements
— building capacity of developing country government officials in international trade
matters
— assisting the process of accession of some 30 countries who are not yet members of
the organization
 — conducting economic research and collecting and disseminating trade data in support
of the WTO's other main activities
— explaining to and educating the public about the WTO, its mission and its activities.
The WTO's founding and guiding principles remain the pursuit of open borders, the
guarantee of most-favoured-nation principle and non-discriminatory treatment by and
among members, and a commitment to transparency in the conduct of its activities. The
opening of national markets to international trade, with justifiable exceptions or with
adequate flexibilities, will encourage and contribute to sustainable development, raise
people's welfare, reduce poverty, and foster peace and stability. At the same time, such
market opening must be accompanied by sound domestic and international policies that
contribute to economic growth and development according to each member's needs and
aspirations.
https://www.wto.org/english/thewto_e/whatis_e/whatis_e.htm
Advantages and disadvantages of WTO
The WTO is a body designed to promote free trade through organizing trade negotiations and act
as an independent arbiter in settling trade disputes. To some extent the WTO has been successful
in promoting greater free trade. The principles of the WTO are

1. Promote free trade through gradual reduction of tariffs

2. Provide legal framework for negotiation of trade disputes. This aims to provide greater
stability and predictability in trade.
3. Trade without discrimination - avoiding preferential trade agreements.
4. WTO is not a completely free trade body. It allows tariffs and trade restrictions under
certain conditions, e.g. protection against 'dumping' of cheap surplus goods.
5. WTO is committed to protecting fair competition. There are rules on subsidies, dumping
6. WTO is committed to economic development. For example, recent rounds have put
pressure on developed countries to accelerate restrictions on imports from the least-developing
countries.
Advantages of promoting free trade
1. Lower prices for consumers. Removing tariffs enables us to buy cheaper imports
2. Free trade encourages greater competitiveness. Through free trade, firms face a higher
incentive to cut costs. For example, a domestic monopoly may now face competition from
foreign firms.
3. The law of comparative advantage states that free trade will enable an increase in
economic welfare. This is because countries can specialise in producing goods where they have a
lower opportunity cost.
4. Economies of scale. By encouraging free trade, firms can specialise and produce a higher
quantity. This enables more economies of scale, this is important for industries with high fixed
costs, such as car and aeroplane manufacture. In new trade theory, it is this specialisation and
exploitation of economies of scale that is most important factor in improving economic welfare.
See also: Advantages of Free Trade

Disadvantages of WTO
 However, the WTO has often been criticised for trade rules which are still unfavourable
towards developing countries. Many developed countries went through a period of tariff
protection; this enabled them to protect new, emerging domestic industries. Ha Joon Chang
argues WTO trade rules are like 'pulling away the ladder they used themselves to climb up'
(Kicking away the ladder at Amazon)
 Free trade may prevent developing economies develop their infant industries. For
example, if a developing economy was trying to diversify their economy to develop a new
manufacturing industry, they may be unable to do it without some tariff protection.
 WTO is being overshadowed by new TIPP trade deals. These deals are negotiated away
from WTO and focuses mainly on US and EU. It excludes China, Russia, India, Brazil and South
Africa. It threatens to diminish the global importance of WTO
 Difficulty of making progress. WTO trade deals have been quite difficult to form
consensus. Various rounds have taken many years to slowly progress. It results in countries
seeking alternatives such as TIPP or local bilateral deals.
 WTO trade deals still encompass a lot of protectionism in areas like agriculture.
Protectionist tariffs which primarily benefit richer nations, such as the EU and US.
 WTO has implemented strong defense of TRIPs ‘Trade Related Intellectual Property’
rights These allow firms to implement patents and copyrights. In areas, such as life-saving drugs,
it has raised the price and made it less affordable for developing countries.
 WTO has rules which favour multinationals. For example, 'most favoured nation'
principle means countries should trade without discrimination. This has advantages but can mean
developing countires cannot give preference to local contractors, but may have to choose foreign
multinationals - whatever their history in repatriation of profit, investment in area.
https://econ.economicshelp.org/2007/06/advantages-and-disadvantages-of-wto.html
b. World Bank
The World Bank is a provider of financial and technical assistance to individual countries
around the globe. The bank considers itself a unique financial institution that sets up
partnerships to reduce poverty and support economic development.

The World Bank supplies qualifying governments with low-interest loans, zero-interest
credits, and grants, all for the purpose of supporting the development of individual economies.
Debt borrowings and cash infusions help with global education, healthcare, public
administration, infrastructure, and private-sector development. The World Bank also shares
information with various entities through policy advice, research and analysis, and technical
assistance. It offers advice and training for both the public and private sectors.

History of the World Bank

The World Bank was created in 1944 out of the Bretton Woods Agreement, which was
secured under the auspices of the United Nations in the latter days of World War II. The
Bretton Woods Agreement included several components: a collective international monetary
system, the formation of the World Bank, and the creation of the International Monetary Fund
(IMF). Since their foundings both the World Bank and the International Monetary Fund have
worked together toward many of the same goals. The original goals of both the World Bank and
IMF were to support European and Asian countries needing financing to fund post-war
reconstruction efforts.

Both the World Bank and IMF outlasted the collective international monetary system
which was central to the Bretton Woods Agreement. President Nixon halted the Bretton Woods
international monetary system in the 1970s. However, the World Bank and IMF remained open
and continued to thrive on providing worldwide aid.

The World Bank and IMF are headquartered in Washington, D.C. The World Bank
currently has more than 10,000 employees in more than 120 offices worldwide. 

Though titled as a bank, the World Bank, is not necessarily a bank in the traditional,
chartered meanings of the word. The World Bank and its subsidiary groups operate within their
own provisions and develop their own proprietary financial assistance products, all with the
same goal of serving countries' capital needs internationally. The World Bank’s counterpart, the
IMF, is structured more like a credit fund. The differing in the structuring of the two entities
and their product offerings allows them to provide different types of financial lending and
financing support. Each entity also has several of its own distinct responsibilities for serving the
global economy.

https://www.investopedia.com/terms/w/worldbank.asp

c. International Monetary Fund

The IMF’s fundamental mission is to ensure the stability of the international monetary
system. It does so in three ways: keeping track of the global economy and the economies of
member countries; lending to countries with balance of payments difficulties; and giving
practical help to members.
Economic Surveillance

The IMF oversees the international monetary system and monitors the economic and financial
policies of its 190 member countries. As part of this process, which takes place both at the global
level and in individual countries, the IMF highlights possible risks to stability and advises on
needed policy adjustments.

Lending

The IMF provides loans to member countries experiencing actual or potential balance of
payments problems to help them rebuild their international reserves, stabilize their currencies,
continue paying for imports, and restore conditions for strong economic growth, while correcting
underlying problems.

Capacity Development

The IMF works with governments around the world to modernize their economic policies
and institutions, and train their people. This helps countries strengthen their economy, improve
growth and create jobs.

https://www.imf.org/en/About

Advantages of the International Monetary Fund

The IMF assists member nations in several different capacities.

Provides Loans to Member Nations

Its most important function is its ability to provide loans to member nations in need of a bailout.
The IMF can attach conditions to these loans, including prescribed economic policies, to which
borrowing governments must comply.

Fills Deficit Gaps

If a country has a balance of payments deficit, the IMF can step in to fill the gap.

Technical Support and Assistance

It serves as a council and adviser to countries attempting a new economic policy.It also publishes
papers on new economic topics.

Disadvantages of the International Monetary Fund

Despite its lofty status and commendable objectives, the IMF is attempting to pull off a nearly
impossible economic feat: perfectly timing and sizing economic intervention on an international
scale. It suffers criticism for the following:

Too Much or Too Little Intervention

The IMF has been criticized for not doing much and for overreaching. It has been criticized for
being too slow or too eager to assist failing national policies. Since the United States, Japan, and
Great Britain feature prominently in IMF policies, it has been accused of being a tool for free-
market countries only. Simultaneously, free-market supporters criticize the IMF for being too
interventionist.

Creates Moral Hazard

Some member nations, such as Italy and Greece, have been accused of pursuing unsustainable
budgets because they believed the world community, led by the IMF, would come to their
rescue. This is no different than the moral hazard created by government bailouts of major banks.

https://www.investopedia.com/ask/answers/061115/what-are-advantages-and-disadvantages-
international-monetary-fund.asp

d. European Union
 The European Union is a unique economic and political union between 27 EU
countries that together cover much of the continent.
The predecessor of the EU was created in the aftermath of the Second World War. The
first steps were to foster economic cooperation: the idea being that countries that trade
with one another become economically interdependent and so more likely to avoid
conflict.
The result was the European Economic Community (EEC), created in 1958, and initially
increasing economic cooperation between six countries: Belgium, Germany, France,
Italy, Luxembourg and the Netherlands.
Since then, 22 other members joined and a huge single market (also known as the
'internal' market) has been created and continues to develop towards its full potential.
On 31 January 2020 the United Kingdom left the European Union.
What began as a purely economic union has evolved into an organization
spanning policy areas, from climate, environment and health to external relations and
security, justice and migration. A name change from the European Economic
Community (EEC) to the European Union (EU) in 1993 reflected this.
Stability, a single currency, mobility and growth
The EU has delivered more than half a century of peace, stability and prosperity,
helped raise living standards and launched a single European currency: the euro. More
than 340 million EU citizens in 19 countries now use it as their currency and enjoy its
benefits.
Thanks to the abolition of border controls between EU countries, people can
travel freely throughout most of the continent. And it has become much easier to live,
work and travel abroad in Europe. All EU citizens have the right and freedom to choose
in which EU country they want to study, work or retire. Every EU country must treat EU
citizens in exactly the same way as its own citizens for employment, social security and
tax purposes.
The EU's main economic engine is the single market. It enables most goods,
services, money and people to move freely. The EU aims to develop this huge resource to
other areas like energy, knowledge and capital markets to ensure that Europeans can draw
the maximum benefit from it.
Transparent and democratic institutions
The EU remains focused on making its governing institutions more transparent
and democratic. Decisions are taken as openly as possible and as closely as possible to
the citizen.
More powers have been given to the directly elected European Parliament, while
national parliaments play a greater role, working alongside the European institutions.
The EU is governed by the principle of representative democracy, with citizens
directly represented at Union level in the European Parliament and Member States
represented in the European Council and the Council of the EU.
European citizens are encouraged to contribute to the democratic life of the Union
by giving their views on EU policies during their development or suggest improvements
to existing laws and policies. The European citizens' initiative empowers citizens to have
a greater say on EU policies that affect their lives. Citizens can also
submit complaints and enquiries concerning the application of EU law.
The EU in the world
Trade
The European Union is the largest trade block in the world. It is the world's
biggest exporter of manufactured goods and services, and the biggest import market for
over 100 countries.
Free trade among its members was one of the EU's founding principles. This is possible
thanks to the single market. Beyond its borders, the EU is also committed to liberalising
world trade.
 Humanitarian aid
The EU is committed to helping victims of man-made and natural disasters
worldwide and supports over 120 million people each year. Collectively, the EU and its
constituent countries are the world's leading donor of humanitarian aid.

Diplomacy and security

The EU plays an important role in diplomacy and works to foster stability,
security and prosperity, democracy, fundamental freedoms and the rule of law at
international level.
https://europa.eu/european-union/about-eu/eu-in-brief_en
e. Association of South East Asian Nations
The Association of Southeast Asian Nations, or ASEAN, was established on 8 August
1967 in Bangkok, Thailand, with the signing of the ASEAN Declaration (Bangkok Declaration)
by the Founding Fathers of ASEAN, namely Indonesia, Malaysia, Philippines, Singapore and
Thailand.

Brunei Darussalam then joined on 7 January 1984, Viet Nam on 28 July 1995, Lao PDR
and Myanmar on 23 July 1997, and Cambodia on 30 April 1999, making up what is today
the ten Member States of ASEAN.

AIMS AND PURPOSES

As set out in the ASEAN Declaration, the aims and purposes of ASEAN are:

1. To accelerate the economic growth, social progress and cultural development in the
region through joint endeavours in the spirit of equality and partnership in order to
strengthen the foundation for a prosperous and peaceful community of Southeast Asian
Nations;
2. To promote regional peace and stability through abiding respect for justice and the rule of
law in the relationship among countries of the region and adherence to the principles of
the United Nations Charter;
3. To promote active collaboration and mutual assistance on matters of common interest in
the economic, social, cultural, technical, scientific and administrative fields;
4. To provide assistance to each other in the form of training and research facilities in the
educational, professional, technical and administrative spheres;
5. To collaborate more effectively for the greater utilisation of their agriculture and
industries, the expansion of their trade, including the study of the problems of
international commodity trade, the improvement of their transportation and
communications facilities and the raising of the living standards of their peoples;
6. To promote Southeast Asian studies; and
7. To maintain close and beneficial cooperation with existing international and regional
organisations with similar aims and purposes, and explore all avenues for even closer
cooperation among themselves.

FUNDAMENTAL PRINCIPLES

In their relations with one another, the ASEAN Member States have adopted the following
fundamental principles, as contained in the Treaty of Amity and Cooperation in Southeast Asia
(TAC) of 1976:

1. Mutual respect for the independence, sovereignty, equality, territorial integrity, and
national identity of all nations;
2. The right of every State to lead its national existence free from external interference,
subversion or coercion;
3. Non-interference in the internal affairs of one another;
4. Settlement of differences or disputes by peaceful manner;
5. Renunciation of the threat or use of force; and
6. Effective cooperation among themselves.