Examples of Communist Economies
                     Examples of Communist Economies
For centuries, humanity has been trying to come up with the ideal structure or 
methodology to successfully run a community, in which every individual agrees 
with the governing body and vice versa. While all the ideologies and planning 
appear flawless on paper, these begin to crumble as soon as they are 
implemented in the real world. Although a majority of the world practice capitalism, 
some countries chose to become communist economies.
What is a Communist Economy?
Simply, an economy that is based on the communist ideology is referred to as a 
communist economy. Communism is an ideology in which the political and 
economic agenda of a ruling body is to establish a community in which classes of 
individuals are disregarded, in theory, promoting equality. Moreover, each individual 
is paid according to their ability and need. In a communist economy, factors of 
production, i.e., labor, land, and entrepreneurship, are owned by a single entity, 
which is usually the government. This ideology was developed by Karl Marx, a 
German philosopher. According to Marx and his co-author, Friedrich Engels, 
communism would have provided a solution for the exploitation of labor and would 
have freed individuals from working in sectors that they don’t wish to work in. 
Theoretically, by implementing advanced manufacturing technology, working hours 
would reduce, and once people begin to work on what they love, they would work 
restlessly, resulting in a better economy. Karl Marx laid out 10 planks or rules of 
communism that are:
● Property cannot be owned privately, and government can issue it to anyone at any 
time.
● Taxes must be dependent on an individual’s income, i.e., the rich must be taxed, 
likewise, the poor should be taxed less.
● If a person passes away, their possessions become the property of the government, 
which is then distributed in the community.
● If a person leaves the country or stands against it, the previous rule applies.
● There must be only one bank that is regulated by the government.
● Mailing and transportation services are also controlled by the government.
● All land is valuable. Farming must be conducted on good soil while factories are to be 
built on badlands.
● Each individual must work, especially in agriculture.
● Allocation of people, factories, and farms in different parts of the country can happen 
at any time to maintain an equal concentration of people and employment.
● Education must be free-for-all children, and children are prohibited from labor, 
especially in factories.
Examples of Communist Economies
1.China
Presently, China is the biggest example of a communist economy. Interestingly, 
China became a communist country in the mid-1900s. This occurred because 
previously, the Chinese, particularly the lower class, were suffering because of 
constant invasions from foreign nations. In 1911, a rebellion against the authority 
took place in Wuchang. Rebellions similar to this had taken place before as well; 
however, this time, the army joined the uprising. While they overthrew the 
authorities at the time, it only lasted for a short duration, and by 1925, China was 
divided into different states governed by warlords. 
To change the shape of the nation both politically and economically, the Chinese 
Communist Party was formed in the 1930s. At the same time, Guomindang, another 
political party, was formed. Initially, both parties worked together; however, as China 
was free from foreign invasions, both parties turned against each other, leading to the 
Chinese Communist Revolution. While the Guodimang party promoted democracy, 
the Chinese Communist Party, led by Mao Zedong favored communism. Ultimately, 
communism was chosen by the public. Mao Zedong introduced two policies, namely 
the Great Leap Forward and the Cultural Revolution, and both of these flopped. The 
former policy was set in motion to accelerate the economic growth of China. It forced 
people to work on farms for extended periods, to boost food production, and in 
factories, to develop products rapidly; however, there was a huge drawback. The 
redistribution of workers was random, meaning people working in factories had no 
idea about the operations or what they were supposed to do. Unsurprisingly, it failed 
and claimed the lives of approximately 50 million people.
Following this, Mao Zedong launched the Cultural Revolution. It was aimed at 
eradicating non-revolutionaries, resulting in the death of 1.25 million people and 
the extinction of Chinese heritage. Finally, Mao passed away in 1976, and the 
power came into the hands of Deng Xiaoping. Deng introduced modernization that 
worked remarkably for China, as he designed each aspect of the policy himself. 
Still, some citizens wanted democracy, and protests across the country started to 
happen, which lead to the massacre at Tiananmen Square in 1989, as the military 
was ordered to establish order. Despite all the ups and down in the communist 
economy of China, it is a superpower with a high gross domestic product value. 
The present communism in China restricts freedom of speech and even monitors 
the internet usage of each citizen.
2. Cuba
The only ruling party in the Republic of Cuba is the Communist Party of Cuba. This island 
country has been subject to many invasions in the past. In the 19th century, it was ruled 
by the Spanish; however, Carlos Manuel de Céspedes led a rebellion for independence 
in the mid-1800s. Originally, this conflict was not planned to stretch for prolonged periods, 
but it lasted for a decade and was called the Ten Year’s War. At the same time, America 
and Spain were waging war against each other. Fortunately, this war finally came to a 
stop with a peace treaty between the mentioned countries in 1898, resulting in America 
taking control of Cuba. Finally, in 1902, Cuba gained independence from the United 
States; however, the US was still legally allowed to intervene in Cuban affairs and 
finances. Gerardo Machado was elected the president of Cuba in 1924. He invested 
heavily in tourism to uplift the economy. 
While it worked in the beginning, the crash of Wall Street led to the downfall of 
Machado. Citizens, especially students, opposed him, and he was ultimately exiled 
from the country. In 1940, Fulgencio Batista became the president of Cuba. During his 
rule, the economy of Cuba saw a drastic downfall with unemployment and inflation. 
Fidel Castro along with his brother, Raúl Castro, launched The Movement against 
Batista by military means. Their attacks failed, and they were captured; however, Fidel 
Castro gave a speech that led citizens to see the unconstitutional ways of Batista. 
Fortunately, both of them were saved and moved to Mexico, where they met Ernest 
‘Che’ Guevara. Interestingly, during Guevara’s university years, he stayed away from 
politics and instead preferred riding his motorcycle for long adventures. During his 
travels, he witnessed the degrading life quality and poverty in South America, and to 
him, it was because of the failing capitalist system. Although he became a doctor in 
1953, he threw away his career just two months later to fight for people. In 1957, Che 
Guevara, Fidel Castro, Raúl Castro, along with 82 men, reached the South of Cuba.
At the time, other rebellions were already taking place in Cuba which led to 
extensive bloodshed. Seeing such events, Americans, who have been supporting 
Batista, decided to side with rebellion groups. Finally, Batista was exiled in 1958. 
At this time, the United States had banned trade with Cuba, and even seize the 
assets of Cubans in the US. By the 1960s, the USSR had established a 
stronghold in Cuba and even deployed numerous nuclear missiles. Unsurprisingly, 
the US government was not happy about this movement, and both countries were 
seriously considering nuclear war for 13 days. This later came to be known as the 
Cuban Missile Crisis. This led to the country following the economic model of the 
USSR, i.e., communism. Although there have been many tough times since the 
implementation of communism in Cuba, it led the country to become what it is 
today.
3. Laos
The only landlocked country in Southeast Asia is a communist economy. Similar to Cuba, 
Laos has been a subject of wars and invasions from foreign powers, but unlike Cuba 
because of the geographical location, it was an ideal ground for business, and Laos 
became a prosperous nation because of the gold and ivory trade. Interestingly, the 
French were a huge ruling power in Laos during the 19th century. When the kingdom of 
Lax Xang split into three kingdoms, out of which three territories were under the French in 
1893, that became Laos. While the Japanese also gained control of the nation during the 
Second World War, it became independent in 1953 under the rule of Sisavang Vong; 
however, a civil war broke out shortly afterward. This civil war was between the royalists 
who supported the king and those who were in the favor of the communist party, Pathet 
Lao, that opposed the king.
The war lasted for nearly two decades. This was also during the period of the 
Vietnamese war, therefore, constant bombardment from the US airforce wreaked 
havoc on the southern hemisphere of the country, as Vietnamese soldiers were 
hiding there. Finally, the civil war was resolved in 1975, with Pathet Lao gaining 
control. Unsurprisingly, the Soviet Union supported the country. Royalists fled to 
Thailand during that time and the country came under the command of Kaysone 
Phomvihane. He renames the country to Lao People’s Democratic Republic. In 
1977, Laos signed a peace treaty with Vietnam. Two years after that, Vietnam 
asked Laos to end relations with China, making it isolated from the largest trade 
market. Despite this, it has become one of the fastest-growing economies in 
Southeast Asia. Laos has also built four railway networks that connect it to the 
neighboring nations. 
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