The United States is said to have what kind of economic system?

Expert Answers

An illustration of the letter 'A' in a speech bubbles

The United States is best categorized as a mixed economy. There is some (many would say too much, many others not enough) regulation of the economy by the government. This means that the United States (nor any other economy) is not really a pure market economy. The economy, however, is still based on private property, and most economic decisions are made based on market forces, so it is not what is often called a command economy. 

For example, business owners determine what wages they will pay based on market forces. If they pay too much, their labor costs will be too high relative to their competitors and their income, and they might lose money. If they pay too little, they might find it difficult to find qualified workers and suffer a labor shortage. But the government, both at the federal level and in many states and municipalities, sets a minimum wage by law in order to achieve the social goal of having every worker be able to make a living. So private or corporate business owners make economic decisions based on market forces, but within limits set by the government. 

Approved by eNotes Editorial Team
Soaring plane image

We’ll help your grades soar

Start your 48-hour free trial and unlock all the summaries, Q&A, and analyses you need to get better grades now.

  • 30,000+ book summaries
  • 20% study tools discount
  • Ad-free content
  • PDF downloads
  • 300,000+ answers
  • 5-star customer support
Start your 48-Hour Free Trial