Types of Economic Planning - SS3 Economics Lesson Note

There are two main types of economic planning: centralized planning and decentralized planning. However, it is important to note that most countries use a mix of both centralized and decentralized planning. 

For example, governments may regulate certain industries or provide subsidies to encourage certain types of production, while leaving other industries to operate based on market forces. Therefore, there is no sole implementation of a specific type of economic planning.

Centralized Planning 

In this type of planning, the government controls and manages the entire economy. The government decides what goods and services to produce, how much to produce, and at what prices they should be sold. This type of planning is often associated with communist and socialist countries.

Decentralized Planning 

In this type of planning, the economy is managed through the actions of individual producers and consumers. The government's role is limited to providing basic regulations and infrastructure to facilitate economic activities. This type of planning is often associated with market economies.