An economic system refers to the structure and methods by which a society organizes the production, distribution, and consumption of goods and services. It encompasses various models, including capitalism, socialism, and mixed economies, each with its own principles and mechanisms for resource allocation. The effectiveness of an economic system can significantly impact a nation's growth and the well-being of its citizens. For instance, a market economy relies on supply and demand to drive economic activity, while a command economy is centrally planned by the government. Understanding these systems helps in analyzing global economic trends.