Economic Planning

Economic planning refers to any directing or planning of economic activity outside the mechanisms of the market. Planning is an economic mechanism for resource allocation and decision-making held in contrast with the market mechanism, where planning refers to a direct allocation of resources. Most economies are mixed economies, incorporating elements of markets and planning for distributing inputs and outputs. The level of centralization of decision-making in the planning process ultimately depends on the type of planning mechanism employed; as such planning need not be centralized and may be based on either centralized or decentralized decision-making.

Economic planning can apply to production, investment, distribution or all three of these functions. Planning may take the form of directive planning or indicative planning. An economy primarily based on central planning is a planned economy; in a planned economy the allocation of resources is determined by a comprehensive plan of production which specifies output requirements.

A distinction can be made between physical planning (as in pure socialism), meaning economic coordination and planning conducted in terms if disaggregated physical units or by a common natural unit, and between financial planning (as practiced by governments and private firms within capitalism).

Read more about Economic PlanningSocialist Economic Planning, Intra-firm and Intra-industry Planning, Criticisms

Other articles related to "economic planning, economic":

Planisme - Economic Planning Versus Command Economies
... Economic planning in general is defined as a mechanism for the allocation of inputs based on a direct allocation, held in contrast with the market mechanism, which is based on indirect allocation ... Economic planning may be carried out in a decentralized, distributed or centralized manner depending on the specific organization of economic institutions ... An economy based on economic planning (either through the state, an association of worker cooperatives or another economic entity that has jurisdiction over the means of production ...
Economic Planning - Criticisms
... See also Economic calculation problem The most notable critique of economic planning came from Austrian economists Friedrich Hayek and Ludwig von Mises ... Central economic planning has also been criticized by proponents of de-centralized economic planning ... therefore be unable to respond to local conditions quickly enough to effectively coordinate all economic activity ...
Ministry Of Economic Planning And Investment Promotion (Zimbabwe)
... The Ministry of Economic Planning and Investment Promotion is a government ministry, responsible for economic planning and investment in Zimbabwe ...
Progressive Utilization Theory - Other Key Concepts - Economics - General Economy
... consists of two parts Organization of the industrial structure Coordination of economic planning at all levels The overall position of PROUT in respect to ... scope for efficient utilization of land and, at the same time, ensure economic security to all farmers ... Economic planning PROUT would organize nations and ultimately the entire world on the basis of self-sufficient economic zones, based purely on socioeconomic and geographical considerations rather ...
Socialist Economics - Description - Socialist Economic Planning
... Economic planning is a mechanism for the allocation of economic inputs and decision-making based on direct allocation, in contrast to the market mechanism, which is ... An economy based on economic planning appropriates its resources as needed, so that allocation comes in the form of internal transfers rather than market ... Economic planning is not synonymous with the concept of a command economy, which existed in the Soviet Union, and was based on a highly bureaucratic administration of the entire economy in ...

Famous quotes containing the words planning and/or economic:

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