Mixed economy combines capitalism and socialism elements. Most modern economies are mixed systems. Private sector works alongside public sector for limited resources
Market failure occurs when supply and demand are not equal in a free market. Prices are determined by supply and demand forces in a typical market
Capitalism is based on private ownership and profit-driven production. It features private property, competition, and wage labor. Capital accumulation drives economic growth through market mechanisms. Markets determine prices and distribution through competition
Neoliberalism emerged in 1930s as response to declining classical liberalism. Term first used by Charles Gide in 1898 to describe Italian economist Pantaleoni. Walter Lippmann Colloquium in 1938 established first meeting of neoliberal movement. Mont Pelerin Society formed in 1947 as international neoliberal think-tank
Market failure occurs when free market allocation is not Pareto efficient. Term first used by economists in 1958, traced back to Sidgwick. Market failures often result from public goods, externalities, or information asymmetries
Market economy relies on supply and demand to guide investment and production decisions. Factor markets play dominant role in capital and production allocation. Government intervention varies from minimal regulation to active social welfare promotion