Definition of Command Economy

Definition of Command Economy

THE COMMAND ECONOMY

A command economy is one in which a central authority has control of the resources of the economy and makes most of the economic decisions.

TODAY : DICTATORSHIPS OR CUBA OR CHINA

IN THE PAST: NEW FRANCE & THE WARTIME ECONOMY OF THE 1940'S

NEW FRANCE

New France was discovered by accident while explorers were searching for shorter trade routes to India and China, where they hoped to find rich sources of gold and spices. By accidentally discovering central and South America they did discover gold and silver produced by the Aztec civilization.

In Canada the first resources to be exploited were - FISH & FURS. New France, as a colony, was to serve 2 purposes.

1. a source of NATURAL RESOURCES for the people of France.

2. A place where the FINISHED MANUFACTURED GOODS could be sold.

The King had ABSOLUTE POWER until 1663, then he appointed officials. The main one was the INTENDANT, who ran the economy of the colony the way the King wanted it.

The industry was AGRICULTURE & FUR TRADING. Furs, fish and other raw materials were sent back to France. In New France, LAND = WEALTH. Land was given to the Lords (Seigneurs) of the King in return for Taxes and a promise to settle the land.

The Lords got farmers (habitants) who paid the Lord taxes and if the farmer didn't pay the taxes the Lord would take his land.

GOODS PRODUCED = WHEAT, TOBACCO, OATS, HEMP (a plant used for making sails).

THE BRITISH COLONIES OF THE TIME WERE RUN IN MUCH THE SAME MANNER.

WHAT WAS THIS TYPE OF ECONOMIC ACTIVITY CALLED?

CANADA'S WARTIME ECONOMY OF THE 1940's.

The entire economy of Canada was involved in the WAR EFFORT. North America became a very important resource area for the Allies.

1941 - The WARTIME PRICES AND TRADE BOARD set maximum prices that goods could be sold for in Canada.

1942 - Goods were rationed such as food and fuel.

THE GOVERNMENT HAD ABSOLUTE POWER

There