<Ul> <Li> </Li> <Li> </Li> <Li> </Li> </Ul> <P> A planned economy is a type of economic system where investment and the allocation of capital goods is performed through economy - wide economic and production plans . A planned economy may be based on centralized, decentralized or participatory forms of economic planning . A command economy or administrative command economy is any of the nominally - planned economies of the former Soviet Union and Eastern Bloc, highlighting the central role of hierarchical administration in guiding the allocation of resources in these economic systems as opposed to planned coordination . </P> <P> Planned economies are usually associated with Soviet - type central planning, which involves centralized state planning and administrative decision making . In command economies, important allocation decisions are made by government authorities and are imposed by law . Planned economies are held in contrast to unplanned economies, specifically market economies, where production, distribution, pricing and investment decisions are made by autonomous firms operating in markets . Market economies that use indicative planning are sometimes referred to as "planned market economies". </P> <P> The traditional conception of socialism involves the integration of socially - owned economic enterprises via some form of planning with direct calculation substituting factor markets . As such the concept of a planned economy is often associated with socialism and socialist planning . More recent approaches to socialist planning and allocation have come from some economists and computer scientists proposing planning mechanisms based on advances in computer science and information technology . </P>

Who makes key decisions in a centrally planned economy