Mixed economy is expected to contain the merits of both capitalism and socialism. The main advantages of mixed economy are given below:
- Individual Freedom: Mixed economy provides adequate freedom to individuals. Private individuals are free to choose their occupation and employment. Entrepreneurs are allowed freedom of enterprise within the regulatory framework. Consumers are free to buy goods and services from any seller in any quantity.
- Rapid Economic Growth: Central planning and market mechanism together help in the rational allocation of resources. Combined efforts of public and private sectors are expected to ensure rapid economic development of the country.
- Social Welfare: Government undertakes policies and programmes for the welfare of public. Regulation and controls are exercised to check monopolies and concentration of economic power in a few hands. Equal opportunities for education and employment are made available to all irrespective of class, race and religion.