Question

Demerits of socialist economy

Answer 1

disadvantages of socialism includes
1) low economy growth less entrepreneurial opportunity and competition and potential lack of motivation by individuals due to lesser rewards
2)critics of socialism claims that it creates distorted or absent price signals results in reduced incentives causes reduced prosperity has low feasibility and that it has negative social and political effects ..
3)economic liberals and Pro capitalist libertarians see private ownership of the means of production and the market exchange as Natural entities or moral rights which are Central to their conceptions of freedom and liberty

Answer 2

Answer:

Demerits of Socialist economy:-

• Socialism is a breeding ground for corruption, red-tapism, and favouritism. The state and the Central Planning Authority hold too much of the power which they often abuse for their personal gains.
• It essentially restricts the freedom of itz citizens. They do not have a choice in the products they wish to buy, or the jobs they want to do. Their freedom is further curtailed by the inability to own any private property.
• Every citizen had the guarantee of a job. So socialism does not promote hard work or any creativity in citizens.
• Administered prices are not the most efficient. They are not based on market forces. Thus the economic and scientific allocation of resources is impossible in this system.
• Sometimes under socialism, we end up creating state monopolies which can get very dangerous with time.

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