How are economic decisions made in a command economy?

In a command economy an authority such as the government, governmental agency, or central planners decide what to produce, how to produce and to whom goods and services will be allocated. read more

Since decision-making is centralized in a command economy, the government controls all of the supply and sets all of the demand. Prices cannot arise naturally like in a market economy, so prices in the economy must be set by government officials. read more

In a command economy, the government makes the economic decisions. This means that they control industry (including manufacturing and agriculture), as opposed to being controlled by the markets and the people. The government decides what goods to produce and how to distribute them. read more