Jamestown: A Controlled Or Planned Economy

Imagine living in a world where the government controlled: what goods you could produce, the quantities of goods you could produce, and the price of those goods. Nothing was in your realm of jurisdiction. This may sound familiar to some. This type of economy is known as a controlled or planned economy, some communist countries use this economic system, such as, Cuba, North Korea, and the former Soviet Union. Now, let's jump to the other side of the economic spectrum to free enterprise or free market. Unlike a controlled economy, a free enterprise allows individuals to have the freedom to: private property rights, voluntary contracts, and competitive bidding of goods and services; which over the past two centuries these three aspects of this …show more content…
We all know that King James the I sent over a group of colonists to discover and colonize the land for himself. At that time the colonists were allowed to live on it, but technically did not own it; it was the King’s land which he could grant ownership to you if he pleased. After a while the colonists grew weary of the King once he started to implement taxes, thus began the fight for independence. Fast forward to almost 200 years later, to July 4, 1776, when America became its own free country and the idea of free enterprise began. With a new country, the founding fathers had to implement laws, which can all be found in the constitution that was created in 1789. Within this document of laws and regulations was the fifth amendment. This amendment clearly states “No person shall be... deprived of life, liberty, or property, without due process of law; nor shall private property be taken for public use, without just compensation.” Once more, fast forward to present day USA where this amendment is still in effect. This is related to an agricultural aspect because the government cannot control what crops or livestock that are grown on your private property. Without this amendment farmers and ranchers would not be able to make a sufficient living because it would all belong to …show more content…
This allows the people to choose: what they want to buy, how much they want to charge for an item, and how much of an item they want to produce. Friedrich Hayek, a nobel winning economists, called this system a “spontaneous order.” His point was that this type of economy is not regulated nor unplanned, instead the planning and regulation come from the arrangement of decentralized knowledge among countless specialists, not the government. There are communist countries where the government controls: what to produce, how much of a good they want to produce, and the price of an item. These countries proclaim that controlling the economy has its advantages. They are able to distribute resources to maximize social welfare and they have more control of employment. However, with advantages comes disadvantages, such as, the countries face shortages and surpluses