Mixed economy is an economic system in which economic decisions are taken both by the state (government) as well as by the market forces (demand and supply). The best example of mixed economic system is India.
The private sector played a secondary (or subsidiary) role in the process of Industrialisation. The growth of the private sector was monitored and checked by the help of licenses. Under the license raj system, the private entrepreneurs can only be established after obtaining license from the government.
The need for the private sector arose with the inability of the government to provide sufficient services such as health care centres and other medical facilities. This inability paved the way for the private sector to step in. The private sector is governed by price signals, thereby, catering to the need of the higher income group, leaving the low income group and the poor at their own mercy which has resulted as a drawback of private sector. Even after this, the private hospitals are attracting more patients than the government hospitals as the government hospitals are devoid of facilities.
