The chief advantages of socialism are as follows:

1.    Social Justice:

Under socialism, there is a just and equitable distribution of national income. Nobody is allowed to receive large unearned incomes. Inequalities of income are reduced to the minimum. All children whether born of poor parents or rich parents are provided equal opportunities to get necessary education and training and develop their talents. No discrimination is made on the basis of caste, class or religion.

2.    Economic Stability:

The problems of overproduction, underproduction, idle capacity and business cycles are eliminated because the Central Planning Authority takes all major economic decisions. Violent fluctuations in economic activity are prevented by balancing aggregate supply with aggregate demand.

3.    Rational Allocation of Resources:

The Central Planning Authority decides the allocation of resources keeping in view the basic needs and preferences of people. Resources are directed towards the production of goods which the society requires rather than those which will yield greater profits. Wastage of resources and duplication of efforts are avoided because decisions are made after a comprehensive survey of the society’s needs and the country’s resources.

4.    Higher Economic Growth:

Economic planning facilitates optimum utilization of resources thereby leading to rapid economic growth. A planned economy works in a systematic and coordinated manner. All competitive wastes like needless varieties and advertising are eliminated. Economies of scale are available due to concentration of production in a few large units. Superior techniques of production are made available to all producing units.

5.    Absence of Class Struggle:

On account of State ownership of productive resources and social distribution of income, there is no struggle between haves and have not’s. Exploitation of one section of society by another section is also avoided.