- The major element that makes up an economic system is the degree to which the supply and demand ends of the production of goods and services are publicly regulated. This includes how much of a given product may or must be produced; who is allowed to profit from it and to what degree; who is the rightful owner of the means of production; and what and how many products may or must be purchased by consumers.
- Capitalism is an economic system predicated on the idea that production is a means to the end of private gain, and as such, the means of production are privately owned and operated. Capital accumulation is divided into the categories of profit made by the producer from the sale of goods or services, and the wages paid by the producer to the laborers who work for him. The role of government in capitalism is to enforce private property rights and contract laws.
- Under a socialist system, the means of production are publicly owned and cooperatively managed. Goods and services are produced and distributed throughout society via a collectively agreed-upon plan so as to avoid the boom-and-bust cycles inherent in an economy whose production and distribution amounts are subject to fluctuations in private capital accumulation. There is, ideally, no need for a formal governing body or controlling authority over economic factors under a socialist system, as the collective decides what will be produced and how it will be distributed.
- Communism is an economic system in which both the means of production and the distribution of goods and services is controlled and regulated by the state via a centrally planned economy. Under a communist system, the state makes decisions regarding what to produce and the policies that will be pursued, with the interests of each individual member of society given equal weight. The government exists to plan and manage its industries and the development of its domestic economy.
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