A planned economy is an economic system where the government makes all decisions about the production and distribution of goods and services. In this system, the state determines what to produce, how much to produce, and the prices of goods, aiming to meet the needs of the population. This approach contrasts with a market economy, where supply and demand dictate these factors. In a planned economy, resources are allocated according to a central plan, often outlined in a document known as a five-year plan. Countries like the former Soviet Union and North Korea have implemented planned economies, focusing on collective ownership and minimizing private enterprise.