The government has the ability to prevent fluctuations in the distribution of income. A disadvantage is sometimes what the planning authority wants to produce is not what the people want to consume. Also, bottlenecks and shortages cause delays in production. Environmental damage is also a major concern of planned economies. There former Soviet Union was considered a planned economy prior to 1989.
Mixed economies are simply a mixture of market and planned economies.
Most economies, including the US consist of this kind of economy. In this way, the advantages of both economies are seized along with none or few of the disadvantages. The Law of Demand states that there is an inverse relationship between the price of a product and the quantity demanded. The different amounts of a product that a seller would make available for sale at different prices in a defined time period when all nonprice factors are held constant is defined as supply. The Law of Supply states that there is a direct relationship between the price of a product and the quantity supplied.