Tuesday, July 14, 2009

Market socialism

Market socialism refers to various economic systems in which the government owns the economic institutions or major industries but operates them according to the rules of supply and demand. A conceptual worker who is not satisfied with his income can threaten to work for a company that will pay him more, thus class divisions arise.[ 

In a traditional market socialist economy, prices would be determined by a government planning ministry, and enterprises would either be state-owned or cooperatively-owned and managed by their employees, but compete with each other in the same way private companies compete. 

Libertarian socialists and left-anarchists often promote a form of market socialism in which enterprises are owned and managed collectively by the workers in a capitalist market. The People's Republic of China currently has a form of market socialism referred to as the socialist market economy but prices are not set by the government. 

Within this model, the state-owned enterprises are free from excessive regulation and function more autonomously in a more decentralized fashion than in other socialist economic systems. The social market economic model is based upon the free market economy, combined with regulative measures from the state.

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