203. What was the economic system of the GDR called?

Answer options

1. Market economy
2. Planned economy
3. Supply and demand
4. Capitalism

Explanation

The GDR operated a socialist planned economy under SED leadership, coordinated by the State Planning Commission and five-year plans; people’s ownership, industrial combines, and administered prices predominated. This structure curtailed private economic autonomy and competition and produced chronic shortages. By contrast, the Basic Law does not mandate a specific economic system but protects occupational freedom and property (Arts. 12, 14 GG), from which the social market order has been derived; Art. 15 GG permits socialization as an exception. In 1990 the Currency, Economic and Social Union and the Unification Treaty replaced the planned economy in the new Länder with a market order, notably via the Treuhandanstalt.