CAPF-AC (Assistant Commandant) Exam Study Material : Indian Economy - Planning in India

CAPF-AC (Assistant Commandant) Exam Study Material : Indian Economy - Planning in India

Indian Economy

Planning in India

Economic Planning

Economic planning is a process under which a central authority (like Planning Commission in India) defines a set of targets (related to growth and development of the country) to be achieved within a specified period of time, keeping in view the needs and means of the country. It refers to a system under which a central planning authority sets a set of targets and specifies as set of programmes and policies to achieve those targets within the specified period of time.

Capitalism, Socialism and a Mixed Economy

Let us have and understanding of concepts of Capitalism, Socialism and Mixed economy. This will help us in having a comprehensive view of goals and objective of planning, particularly in the context of the Indian economy.

Capitalism

It is an economic system in which major economic decisions

  1. what goods and services are to be produced,
  2. how goods and services are to be produced, and
  3. how goods and services are to be distributed are left to the free play of the market forces, or the forces of supply and demand. There is a private ownership of the means of production, and all economic decisions are taken with a view to maximizing profits.

To illustrate:

  1. only those goods and services will be produced for which there is high demand in the market, offering high profits,
  2. goods will be produced using such a mix of the factors of production, that minimizes the cost of production, and
  3. goods and services will get distributed according to purchasing power of the households. Buy as much as you are able to; nothing if not able to.

Merit of Capitalism: The principle merit of this system is that if fosters self-interest, and accordingly accelerates the pace of economic growth. Demerit of Capitalism: The principal demerit is that is overlook the collective interest or social interest and leaves poorer sections of the society at the mercy of market forces of supply and demand.

केन्द्रीय सशस्त्र पुलिस बल (सहायक कमांडेंट) के लिये स्टडी किट

Study Kit for Central Armed Police Forces(AC)

<< Go Back To Main Page

For Study Materials Call Us at +91 8800734161 (MON-SAT 11AM-7PM)