The government should ensure that conditions exist for the proper functioning of the market mechanism. One of the basics of the market is that individuals must be free to follow their interests. The government must insure that individuals are protected against the forceful tactics of the individuals or groups.
Owners of resources must feel secure that their properties are protected. The government must provide this security by protecting property rights. Individuals need to feel safe that agreements made with other individuals or groups of individuals will be honored.
If the market system is left unregulated it may distribute the total product among the members of the society in an unsatisfactory manner, the government should be involved to achieve just distributions of income among individuals in the society.
4b).
Capitalism - economic system based on competition between businesses.
Communism - socialistic ideal that aspires to economic equality and equal distribution of property.
Fascism - extreme nationalism, dictatorial form of government.
Socialism - political theory advocating collective ownership and administration of production and distributions of goods, justice and equality.
Democratic - equal rights and treatment for all.
Totalitarianism - authoritarian government that attempts to regulate every aspect of sociocultural life.
4c) Countries in the democratic category, which includes Canada, have mixed economic system, with the emphasis being towards a market economy rather than a command one. Countries in the non-democratic category also have mixed economic systems. But the communist countries have usually market economic systems.
Democratic countries like Canada fall under the "Capitalists" category, the mixed economic system.
Socialism - there is a considerable degree of central economic and social planning, and the welfare of society generally is a prime concern of the government. Various democratic and non-democratic countries have professed to be socialist at one time or another.
