Economy Systems Handling A Crisis When disaster strikes, it leaves many citizens in disarray. Man-made disasters can sometimes be prevented beforehand, but natural disasters happen and it is out of our control. The most important thing we can do in the event of a disaster is to be prepared to respond. It definitely helps to have an economic system that is able to be the most effective when the effects of a disaster becomes a problem. These effects such as unsanitary resources, homelessness, job loss, crime, and the change in supply and demand for many essential needs become impactful but the right economy system can get things going sometimes even better than how they were before. The best system for handling a crisis such as a natural disaster is that of a mixed-economy. This allows for proper government intervention to help the affected people, and the economic freedom of businesses to keep the economy moving in a positive direction. There are three major economic systems in today’s world. The difference between each lies in the relationship of the amount of control the government has and how much freedom the individuals have on the factors of production. Free-market (or capitalist) economy allows private ownership and individuals choice over what and what not to produce and sell with little Government intervention. A planned (or command) economy in the opposite, in which the government controls most factors of production, make production plans beforehand and they do not support/allow entrepreneurship in most industries. Then there’s a mixed economy (or socialist system), where entrepreneurship is allowed by the government in certain industries, while they regulate the vital ones such as communications, transportation, and health care (Bovée, Thill 2013). Survivors of disasters like hurricanes or floods are often left with little to no land, or resources for themselves and are really in need of immediate help from some type of Government aid. The supply and demand for things like water, shelter and other important products cause prices to rise. In a free-market economy, entrepreneurs will see this price rise and be glad o bring in the necessary resources because of the promise of profit (Mak 2011). The only thing is that without some form of assistance, some families may not be able to afford the things they need. With a planned economy system, the government plans all (or most) of the production and where the resources go. In the event in a disaster, the government may or may not be prepared to supply citizens with the essential products they need based on their plans for the year. The socialist system, which allows government intervention and businesses operating in a “free-market” based type of way, would be the best fit to handle such a situation. The businesses will bring the necessary resources needed, and possibly make some good profit. The government, who has multiple departments especially to protect the consumers and meet their basic needs, can step in and assist those who need it. This way the economy is moving forward quicker than it would in a free market or a planned economy. This applies to other emergency situations that can occur, such as the 2010 earthquake that struck Haiti. In general, it is just better to have both the citizens and the government interacting in a socialist way. This gives a nation a sense of balance, instead of being heavily one-sided as a free-market or planned system would be. Another aspect of economy that you is impossible to ignore is supply and demand. The laws of supply and demand determines the quality and price of goods sold. The demand represents what the buyers are willing to pay for a specific good or service at any given time. The supply represents how much of a good or service a supplier is wiling to provide at any time. Prices change when one or more factors influence the supply or demand for a certain thing. When it gets cold in the winter, more and more people prefer for their homes to be heated. More products are then made to heat homes and businesses because it is a need of the people. And because people are willing to spend what it takes, the manufacturers and controllers of heat can increase their prices to maximum profit. In conclusion, a mixed economy is the most efficient when recovering from an emergency situation. Outside entrepreneurs can supply survivors with the resources they need as the demand for them increases. Those who cannot afford them are assisted by the government and other organizations specially created to help in extreme situations. This allows the economy to naturally balance itself out with private and public organizations doing their part to help people and generate profit.

BIBLIOGRAPHY Bovee, Courtland, and John Thill. "Understanding Basic Economics." Business in Action. 6th ed. Prentice Hall, 2012. 592. Print.
Mak, Tim. "Disaster Economics: Floods and the Freemarket." (2011). Fraserinstiture.org. Web. 2 Nov. 2014. <http://www.fraserinstitute.org/uploadedFiles/fraser-ca/Content/research-news/research/articles/disaster-economics-floods-and-free-market-CSR-winter2011.pdf>.