Types of Economic Planning

Directional Planning

Countries, which believe in socialism, followed the directional type of planning. The targets of plans are pre-determined and executed with the help of the government in power. In this form of planning, all the important positions and decisions are taken by the state. In this type of planning, all things are under control of state including, financial institutions, industrial sector, transport, and infrastructure.

Faults of Planning by Direction

  • It involves bureaucratic system, which is time consuming, and there is lack of clarity.
  • People are not allowed to do job of their choice and are not even allowed to ....
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