1. Circular Flow of Wealth Models
Economic Systems
Circular Flow of Wealth Models

2. Pure Capitalism Wealth
The entrepreneurs
The businesses
The products
The people
invest wealth: land, labor or capital to create a business
profits from sales of products
Wealth
purchased by the people using cash earned through factor market
produce the goods and services by combining land, labor and capital
Left out: the government

3. Pure Socialism Wealth The government
The businesses
The products
The people
invest wealth: land, labor or capital to create a business
profits from sales of products, taxes or forced labor
Wealth
distributed to the people using government planning or cash purchases
produce the goods and services by combining land, labor and capital
Left out: entrepreneurs

4. Pure Communism Wealth The people The businesses The products
businesses give products to the people based on what the people need
people donate their wealth (land, labor or capital) to the businesses
Wealth
produce the goods and services by combining land, labor and capital
Left out: government and entrepreneurs

5. Mixed Economies Wealth Left out: no one The government
The entrepreneurs
The government
The businesses
The products
The people
profits from sales of products
invest wealth: land or capital to create a business
profits from sales of products, taxes or forced labor
Wealth
purchased by the people using cash earned through factor market
produce the goods and services by combining land, labor and capital
distributed to the people using government planning or cash purchases