THE DIFFERENCE IN ECONOMIC SYSTEMS IN CAPITALIST AND COMMUNIST COUNTRIES

Abstract

The paper’s aim is to help enterprises receive an in-depth understand about the nature of politics that effect on the whole world economy to discover a successful path to a sustainable business. In addition, foreign enterprises also take a careful look about capital investment in different politics in different countries to avoid bad debt, especially in China and United State. An economic system consists of the institutions and the method by which resources are allocated and products and services are distributed. Economic systems differ primarily in who owns the factors of production, how the allocation of resources is directed and the method used to direct economic activity. The primary distinction between the different systems is the degree to which the government participates in the economy.

This paper also examines the pros and cons of each system, as it differ greatly from one another. It focuses on an imperative features in explaining the dimensions of the perceptual process and outlines the assessment in which reader can better understand how each economic system run as well as their advantages and disadvantage.