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11. The Mixed Economy by Clarice - Coggle Diagram
11. The Mixed Economy
by Clarice
Private Sector Organisations
Provision of goods and services by businesses that are owned by individuals/group of individuals
Ownership and control: (group of) individual(s)
Sole traders
Partnerships
Companies
Aims
Survival
Profit maximisation
Growth
Social responsibility
Public Sector Organisations
Government organisations that provide goods and services in the economy
Ownership and control: government
Central government departments e.g. Department of Health
Public corporations or state-owned enterprises
Local authority services e.g. library
Other public sector organisations that are run by a trust/board/experienced expert/the Queen e.g. BBC
Aims
Improve quality of services
Minimising costs
Allows for social costs and benefits
Profit
Economy where goods and services are provided by both the private and public sectors
Decisions
What to produce?
How to produce?
For whom to produce?
Market Failure and the Need for Government Intervention
Externalities
Lack of competition
Missing markets (public goods and merit goods)
Lack of information
Factor immobility
Role of the Private and Public Sectors in the Production of Goods and Services
Non-exclubaility
: any individual consumer cannot be prevented or excluded from its consumption
Non-rivalry
: consumption of a public good by one individual cannot reduce the amount available to others