Difference between Simple and Complex Economy

Simple and Complex Economy

A simple economy refers to a system wherein people produce simple goods in limited numbers/quantities for the satisfaction of their wants. The barter system of exchange prevails in this economy. These types of economies existed in Indian villages in olden times.

A complex economy refers to a system wherein several kinds of goods are produced in large quantities. The process of production in these economies is highly complex and advanced. Money is widely used as a medium of exchange. This economy came into existence in the Post-Industrial Revolution period.

Difference between Simple and Complex Economy

Simple EconomyComplex Economy
Only simple goods are produced to satisfy basic human wants.A variety of goods are produced and in large quantities.
Techniques used in the production process are simple.Techniques used in the production are complex and highly advanced.
A barter system is used for buying and selling goods.Money is used as a medium of exchange for goods and services.
Wants are limited as people live in isolation and are self-sufficient.Goods are produced in large quantities not only for self-use but also to be supplied and sold to distant markets.
It is a self-reliant economy.It is a modern economy.

Also, read Difference between Open Economy and Closed Economy