Economic System in Cuba

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An economic system is a pattern of organisation which is aimed at solving the three central questions. These questions are: What should be produced? How should it be produced? For whom should it be produced? There are four systems that can be implemented in a country to solve the central questions, traditional system, command system, market system and mixed system. The most popular systems are the market and mixed system, however, there are still some countries, although very few, that follow a communist command system and Cuba is one of those very few countries. When Cuba was discovered in 1492, it was colonised by Spain. Then, in 1898, after the Spanish-American war, it was briefly under the administration of the United States, until 1902 when it became formally independent. After being under a dictatorship and suffering through corruption, political oppression and economic regulations, the country had developed into a single-party state under the revived Communist Party of Cuba, which still rules to date. Most of the enterprises in Cuba are run by the state and the government owns and runs most of the means of production of the country. Majority of the labour force is employed by the state, but the formation of corporatives and self-employment has been strongly encouraged in recent years by the Communist Party. Although it is a communist country, the government use socialist principles to organise the economy. About 83% of the workforce is employed by the state, with an additional 5% employed by cooperatives closely connected to the state. This means that only 12% of the entire workforce is employed in the private sector. The 12% is made up of private farmers, artists and only about 142 000 self-employed people (Cuba: Economy). Low housing and transport costs, free education and health care, and food subsidies are all provided for the citizens of Cuba. Even though these benefits are provided, Cuba is one of the world’s most corrupt states, but at the same...
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