A market economy is an economic system whereby major decisions like investment,

production and distribution of products are guided by prices in the market through supply
and demand. Pakistan is a third world country which has a growing economy and a market
economy is not bad for the country through there are some advantages and disadvantages
of the system which include; creation of innovation whereby the economy will come up with
different methods to increase production and increase employment opportunities in the
country.

Explanation:
A market economy is an economic system whereby major decisions like investment,
production and distribution of products are guided by prices in the market through supply
and demand. Pakistan is a third world country which has a growing economy and a market
economy is not bad for the country through there are some advantages and disadvantages
of the system which include; creation of innovation whereby the economy will come up with
different methods to increase production and increase employment opportunities in the
country. Market economy will lead to a variety of goods being produced in the country and
business differentiation will come up in the country. There is freedom of choice in the
economy at large as individuals will choose whether to open up a business or work for the
market and purchase of goods if they are affordable. Market economy has certain
disadvantages however and include; poor working conditions which can occur due to lack of
government regulations. Poor distribution of wealth will also be witnessed as the wealthier
will generate more wealth while the poor will find it difficult to make more money.
Environmental damage is another factor that could come about as the government has not
laid down certain regulations to be followed by the country. A country like Pakistan should
consider the market economy system due to creation of business opportunities for the
whole economy and people shall not be afraid to venture into many businesses.