production and distribution decisions are largely determined by the way things have been done in the past. There is little money. These economies are usually found in remote parts of Africa, Asia, Latin America and the Middle East where people are engaged in agriculture, fishing or hunting.

an economy where the who, what, and for whom questions are answered by tradition.

A traditional economy is an economic system in which resources are allocated by inheritance, and which has a strong social network and is based on primitive methods and tools. It is strongly connected to subsistence farming. In the majority of countries traditional economy has been replaced by command economy, market economy or mixed economy.