Question

Here in the United States we always talk about how we have a free market system. But do we? In this discussion let's talk about our economic system. Discuss how our system is free market (or not) and why. Also compare and contrast our system to those of other countries' systems.  Support your discussion with facts, not opinion, and cite your sources.

Answer 1

*Answer:

Typically, it is said that US economy is market based economy or it follows market system where all economic decisions are taken by the market forces of demand and supply. Government does not play active role in economic decision making in pure market economy.

But after studying past few years data on economics, we can argue that US economy is not pure market economy. Following points corroborate this fact:

• Government is making massive expenditure on welfare schemes which is usually done in government dominated economies.
• Government has offered massive bailout packages to prevent fall of economy during the financial crisis.
• Government makes expenditure on development of infrastructure which depicts the active role of government in economic activities.

Thus, US economy is no longer a pure market economy. State is now no longer acting like police state. State is actively participating in economic activities and assuming role of welfare state. It provides sustenance to market system else it would have been perished.

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