Capitalism may be defined as an economic system in which private persons are permitted (subject to regulations by the state) to establish factories, open mills, create banks and other business firms." It may be defined as, "It is a system in which all the means of production and sources of wealth are privatized or denationalized."
Below are the advantages and disadvantages of communist economic system. Under comprehensive State planning, goods and services are produced strictly according to need. Anohter befit of communist economy is the elimination of large-scale wastage of resources.
The first feature of the communist economic system is the abolition of the private ownership of means of production. In this system, an individual can own nothing except necessaries of life. No one can run private business.
Mixed Economy is an economic system which combines in itself the features of capitalism and that of the Socialism. Unlike a pure capitalistic economy, it has an important public sector, i.e. a number of industries which are owned and managed by the state. The State is not the all pervasive owner of all means of production.
Socialism is an economic system in which the means of production are owned and managed by the State. Ownership of means of production is not allowed. People can have personal property which is transferable and inheritable. In socialism economic activities are carried on mainly for social gains and personal interest is of less significance.
Communism is an economic system where means of production are controlled and managed by a Central State Authority, and there is also a restriction on the ownership of personal property. In communism personal belongings, as clothing, watches, and shoes are allowed to be owned by individuals and the houses are owned by the State.
Capitalism is that part of economic systems where productions are owned and managed by private individuals and institutions. They are at liberty to use any technique of production and produce anything they like. In capitalism, State is to take care of only internal and external security of the country.
According to Loucks definition of economic system is that it consist of those institutions which a given people or nation or group of nations has chosen or accepted as the means through which resources are utilized for the satisfaction of human wants. According to Gruchy, It is an evolving pattern or complex of human relations which is concerned with the disposal of scarce resources