The Netherlands and Cuba, Two Contrasting Economic Systems
             The world economy is made of several different forms of economic systems. Since the fall of communism in Eastern Europe, market economies are becoming more prevalent in the World. While many of the countries having a command form of economic system are making the transformation to market forms of economic systems, few countries are resisting the pressure to make the transformation and continue to operate under the command form of economy. The following paragraphs will explain the distribution of income, production, and the role of government in Netherlands' market economy and Cuba's command economy.
             Overview of Market and Command Economies
             A market economy is one in which resources are privately owned and controlled. The market governs decision-making in this type of economy. This economic environment encourages competition among businesses by allowing sellers the freedom to increase or decrease prices according to changing market conditions (Market Economy, n.d.). The market is very responsive to the needs and wants of consumers. In this type of economy, businesses operate to make a profit.
             A command economy is one in which resources are owned and controlled by the government. This economy offers little in the way of individual freedom. The government dictates the job in which a person works and the wages to be paid. The government sets the prices of goods and services as well as the quantity to be produced, thus eliminating the competition aspect of an economy. Therefore, businesses are not operated for creating a profit, but for the purpose of social good.
             Distribution of Income and Utility Maximization
             Income distribution refers to how much income flows to each member of society (Colander, 2001). One characteristic of income distribution in a market economy is that it is unequal. In a market economy, people earn income by working or selling individu...