Questions what is the main features of the socialist economy?

What is the command economy?

Key words: socialism, government regulation, property ownership
A command economy is a system where the government, rather than the free market, determines what goods should be produced, how much should be produced, and the price at which the goods are offered for sale. It also determines investments and incomes. The command economy is a key feature of any communist society. Cuba, North Korea, and the former Soviet Union are examples of countries that have command economies, while China maintained a command economy for decades before transitioning to a mixed economy that features both communistic and capitalistic elements.

12. 
    What is the transition economy?
    

Key words: liberalization, privatisation, tariffs
A transition economy is one that is changing from central planning to free markets. Since the collapse of communism in the late 1980s, countries of the former Soviet Union, and its satellite states, including Poland, Hungary, and Bulgaria, sought to embrace market capitalism and abandon central planning. However, most of these transition economies have faced severe short-term difficulties, and longer-term constraints on development.

13. 
    The need for the transition from a command economy to a market economy?
    

Key words: inflexibility, efficiency, innovation
A command economy occurs when the government control the main means of production. The government set prices and determines what is produced. A market economy is fundamentally different. It shifts ownership of the means of production to private individuals and firms. Prices and output are determined by market forces. To make the shift from a command economy to a free market economy requires
Privatisation of state-owned industries
Removal of price controls
Removal of tariff barriers

14. 
    Problems of transition economies?
    

Key words: subsidy, inflation, corruption
Rising unemployment
Transition process involves in privatisation of firms. The newly privatised firms face competition from other firms, and thus try to be efficient.
Rising inflation
Many transition economies also experienced price inflation as a result of the removal of price controls imposed by governments.
Inequality
Transition economies probably had a fairly equal distribution of wealth(atleast in the theory) among the people.
Corruption and consumer abuse
As the economy starts the transition, the legal system is usually not adequate to prevent corruption.

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