Planned Economy
A planned economy is an economic system where the government or a central authority makes all decisions regarding the production and distribution of goods and services, rather than relying on market forces. It involves detailed economic planning to allocate resources, set production targets, and control prices, often aiming to achieve specific social or economic goals such as equity or rapid industrialization. This system contrasts with market economies where supply and demand drive economic decisions.
Developers should understand planned economies when working on projects related to economic simulations, policy analysis tools, or historical data modeling, as it provides context for centralized resource allocation systems. Knowledge of this concept is useful in fields like game development for strategy games, economic research software, or when analyzing data from countries with state-controlled economies to build accurate models or visualizations.