Question

what is socialism and explain it features

Answer 1

Socialism refers to the government ownership of the means of production, planning by the government and income distribution”-Samuelson
Main Features of Socialist Economy:

The main features of socialist economy are as follows:

(i) Collective Ownership:

In socialism, all means of production are owned by the community, i.e., Government, and no individual can hold private property beyond certain limit. Therefore, it is government who utilises these resources in the interest of social welfare.

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(ii) Economic, Social and Political Equality:

Under socialism, there is almost equality between rich and poor. There is no problem of class struggle.

(iii) Economic Planning:

Under socialism, government fixes certain objectives. In order to achieve these objectives, government adopts economic planning. All types of decisions regarding the central problems of an economy are taken in the economic plans. There is a Central Planning Authority, who plans for the economy.

(iv) No Competition:

Unlike capitalistic economy, there is no cut throat competition. It means lack of competition as state is the sole entrepreneur.

(v) Positive Role of Government:

In socialism, government plays significant role in decision making. Thus, government has complete control over economic activities like distribution, exchange, consumption, investment and foreign trade etc.

(vi) Work and Wages According to Ability and Needs:

In socialistic economy, work is according to ability and wage according to need. It is said that under socialism “from each according to his ability to each according to his needs, is socialism.”