Reference no: EM132063144

If we view the capitalism economy, most recessions and depressions in recent periods came from the problem that: Aggregate Demand is less than the Aggregate Supply. Therefore, in macroeconomies, government participate in the economy as an essential role. But if we look at the socialism economies such as China before 1978 and Soviet Union, they seem to have a problem that: Aggregate Supply is less than the Aggregate Demand. (famine etc) Are these two economic systems naturally have these problems correspondingly? Can we say that most economies currently in this world are combining the advantages of both systems? (eg: freedom in capitalism and planning in socialism)