Mixed economy

Mixed economy

Overview
Mixed economy is an economic system
Economic system
An economic system is the combination of the various agencies, entities that provide the economic structure that defines the social community. These agencies are joined by lines of trade and exchange along which goods, money etc. are continuously flowing. An example of such a system for a closed...

 in which both the state
State (polity)
A state is an organized political community, living under a government. States may be sovereign and may enjoy a monopoly on the legal initiation of force and are not dependent on, or subject to any other power or state. Many states are federated states which participate in a federal union...

 and private sector
Private sector
In economics, the private sector is that part of the economy, sometimes referred to as the citizen sector, which is run by private individuals or groups, usually as a means of enterprise for profit, and is not controlled by the state...

 direct the economy
Economy
An economy consists of the economic system of a country or other area; the labor, capital and land resources; and the manufacturing, trade, distribution, and consumption of goods and services of that area...

, reflecting characteristics of both market economies
Market economy
A market economy is an economy in which the prices of goods and services are determined in a free price system. This is often contrasted with a state-directed or planned economy. Market economies can range from hypothetically pure laissez-faire variants to an assortment of real-world mixed...

 and planned economies
Planned economy
A planned economy is an economic system in which decisions regarding production and investment are embodied in a plan formulated by a central authority, usually by a government agency...

. Most mixed economies can be described as market economies
Market economy
A market economy is an economy in which the prices of goods and services are determined in a free price system. This is often contrasted with a state-directed or planned economy. Market economies can range from hypothetically pure laissez-faire variants to an assortment of real-world mixed...

 with strong regulatory
Regulation
Regulation is administrative legislation that constitutes or constrains rights and allocates responsibilities. It can be distinguished from primary legislation on the one hand and judge-made law on the other...

 oversight, in addition to having a variety of government-sponsored aspects. See Elements of a mixed economy.

The underlying premise of the mixed economy is that the means of production are mainly under private ownership
Private property
Private property is the right of persons and firms to obtain, own, control, employ, dispose of, and bequeath land, capital, and other forms of property. Private property is distinguishable from public property, which refers to assets owned by a state, community or government rather than by...

; that markets remain the dominant form of economic coordination; and that profit-seeking enterprises and the accumulation of capital would remain the fundamental driving force behind economic activity.
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Encyclopedia
Mixed economy is an economic system
Economic system
An economic system is the combination of the various agencies, entities that provide the economic structure that defines the social community. These agencies are joined by lines of trade and exchange along which goods, money etc. are continuously flowing. An example of such a system for a closed...

 in which both the state
State (polity)
A state is an organized political community, living under a government. States may be sovereign and may enjoy a monopoly on the legal initiation of force and are not dependent on, or subject to any other power or state. Many states are federated states which participate in a federal union...

 and private sector
Private sector
In economics, the private sector is that part of the economy, sometimes referred to as the citizen sector, which is run by private individuals or groups, usually as a means of enterprise for profit, and is not controlled by the state...

 direct the economy
Economy
An economy consists of the economic system of a country or other area; the labor, capital and land resources; and the manufacturing, trade, distribution, and consumption of goods and services of that area...

, reflecting characteristics of both market economies
Market economy
A market economy is an economy in which the prices of goods and services are determined in a free price system. This is often contrasted with a state-directed or planned economy. Market economies can range from hypothetically pure laissez-faire variants to an assortment of real-world mixed...

 and planned economies
Planned economy
A planned economy is an economic system in which decisions regarding production and investment are embodied in a plan formulated by a central authority, usually by a government agency...

. Most mixed economies can be described as market economies
Market economy
A market economy is an economy in which the prices of goods and services are determined in a free price system. This is often contrasted with a state-directed or planned economy. Market economies can range from hypothetically pure laissez-faire variants to an assortment of real-world mixed...

 with strong regulatory
Regulation
Regulation is administrative legislation that constitutes or constrains rights and allocates responsibilities. It can be distinguished from primary legislation on the one hand and judge-made law on the other...

 oversight, in addition to having a variety of government-sponsored aspects. See Elements of a mixed economy.

The underlying premise of the mixed economy is that the means of production are mainly under private ownership
Private property
Private property is the right of persons and firms to obtain, own, control, employ, dispose of, and bequeath land, capital, and other forms of property. Private property is distinguishable from public property, which refers to assets owned by a state, community or government rather than by...

; that markets remain the dominant form of economic coordination; and that profit-seeking enterprises and the accumulation of capital would remain the fundamental driving force behind economic activity. Additionally, the government would wield considerable influence over the economy through fiscal
Fiscal policy
In economics and political science, fiscal policy is the use of government expenditure and revenue collection to influence the economy....

 and monetary policies
Monetary policy
Monetary policy is the process by which the monetary authority of a country controls the supply of money, often targeting a rate of interest for the purpose of promoting economic growth and stability. The official goals usually include relatively stable prices and low unemployment...

 designed to counteract economic downturns and capitalism's tendency toward financial crises and unemployment
Unemployment
Unemployment , as defined by the International Labour Organization, occurs when people are without jobs and they have actively sought work within the past four weeks...

, along with playing a role in social welfare
Welfare
Welfare refers to a broad discourse which may hold certain implications regarding the provision of a minimal level of wellbeing and social support for all citizens without the stigma of charity. This is termed "social solidarity"...

 interventions. Subsequently, some mixed economies have expanded to include indicative economic planning
Indicative planning
Indicative planning is a form of central economic planning implemented by a state in an effort to solve the problem of imperfect information in economies and thus increase economic performance...

 or large public enterprise sectors.

There is not one single definition for a mixed economy, but the definitions always involve a degree of private economic freedom
Economic freedom
Economic freedom is a term used in economic and policy debates. As with freedom generally, there are various definitions, but no universally accepted concept of economic freedom...

 mixed with a degree of government regulation of markets. The relative strength or weakness of each component in the national economy can vary greatly between countries. Economies ranging from the United States to Cuba
Cuba
The Republic of Cuba is an island nation in the Caribbean. The nation of Cuba consists of the main island of Cuba, the Isla de la Juventud, and several archipelagos. Havana is the largest city in Cuba and the country's capital. Santiago de Cuba is the second largest city...

 have been termed mixed economies. The term is also used to describe the economies of countries which are referred to as welfare state
Welfare state
A welfare state is a "concept of government in which the state plays a key role in the protection and promotion of the economic and social well-being of its citizens. It is based on the principles of equality of opportunity, equitable distribution of wealth, and public responsibility for those...

s, such as Norway and Sweden. Governments in mixed economies often provide environmental protection
Environmental protection
Environmental protection is a practice of protecting the environment, on individual, organizational or governmental level, for the benefit of the natural environment and humans. Due to the pressures of population and our technology the biophysical environment is being degraded, sometimes permanently...

, maintenance of employment standards, a standardized welfare
Welfare
Welfare refers to a broad discourse which may hold certain implications regarding the provision of a minimal level of wellbeing and social support for all citizens without the stigma of charity. This is termed "social solidarity"...

 system, and maintenance of competition
Competition law
Competition law, known in the United States as antitrust law, is law that promotes or maintains market competition by regulating anti-competitive conduct by companies....

.

As an economic ideal, mixed economies are supported by people of various political persuasions, typically centre-left
Centre-left
Centre-left is a political term that describes individuals, political parties or organisations such as think tanks whose ideology lies between the centre and the left on the left-right spectrum...

 and centre-right
Centre-right
The centre-right or center-right is a political term commonly used to describe or denote individuals, political parties, or organizations whose views stretch from the centre to the right on the left-right spectrum, excluding far right stances. Centre-right can also describe a coalition of centrist...

, such as social democrats
Social democracy
Social democracy is a political ideology of the center-left on the political spectrum. Social democracy is officially a form of evolutionary reformist socialism. It supports class collaboration as the course to achieve socialism...

 or Christian democrats
Christian Democracy
Christian democracy is a political ideology that seeks to apply Christian principles to public policy. It emerged in nineteenth-century Europe under the influence of conservatism and Catholic social teaching...

. Supporters view mixed economies as a compromise between socialism
Socialism
Socialism is an economic system characterized by social ownership of the means of production and cooperative management of the economy; or a political philosophy advocating such a system. "Social ownership" may refer to any one of, or a combination of, the following: cooperative enterprises,...

 and laissez-faire
Laissez-faire
In economics, laissez-faire describes an environment in which transactions between private parties are free from state intervention, including restrictive regulations, taxes, tariffs and enforced monopolies....

 capitalism that is superior in net effect to either of those.

History



The term "mixed economy" arose in the context of political debate in the United Kingdom
United Kingdom
The United Kingdom of Great Britain and Northern IrelandIn the United Kingdom and Dependencies, other languages have been officially recognised as legitimate autochthonous languages under the European Charter for Regional or Minority Languages...

 in the postwar period, although the set of policies later associated with the term had been advocated from at least the 1930s. Supporters of the mixed economy, including R. H. Tawney
R. H. Tawney
Richard Henry Tawney was an English economic historian, social critic, Christian socialist, and an important proponent of adult education....

, Anthony Crosland
Anthony Crosland
Charles Anthony Raven Crosland , otherwise Tony Crosland or C.A.R. Crosland, was a British Labour Party politician and author. He served as Member of Parliament for South Gloucestershire and later for Great Grimsby...

 and Andrew Shonfield were mostly associated with the British Labour Party, although similar views were expressed by Conservatives
Conservative Party (UK)
The Conservative Party, formally the Conservative and Unionist Party, is a centre-right political party in the United Kingdom that adheres to the philosophies of conservatism and British unionism. It is the largest political party in the UK, and is currently the largest single party in the House...

 including Harold Macmillan
Harold Macmillan
Maurice Harold Macmillan, 1st Earl of Stockton, OM, PC was Conservative Prime Minister of the United Kingdom from 10 January 1957 to 18 October 1963....

.

Critics of the British mixed economy, including Ludwig von Mises
Ludwig von Mises
Ludwig Heinrich Edler von Mises was an Austrian economist, philosopher, and classical liberal who had a significant influence on the modern Libertarian movement and the "Austrian School" of economic thought.-Biography:-Early life:...

 and Friedrich von Hayek, argued that what is called a mixed economy is a move toward socialism and increasing the influence of the state.

Philosophy


The term mixed economy is used to describe economic systems which stray from the ideals of either the market
Market
A market is one of many varieties of systems, institutions, procedures, social relations and infrastructures whereby parties engage in exchange. While parties may exchange goods and services by barter, most markets rely on sellers offering their goods or services in exchange for money from buyers...

, or various planned economies
Planned economy
A planned economy is an economic system in which decisions regarding production and investment are embodied in a plan formulated by a central authority, usually by a government agency...

, and "mix" with elements of each other. As most political-economic ideologies
Ideology
An ideology is a set of ideas that constitutes one's goals, expectations, and actions. An ideology can be thought of as a comprehensive vision, as a way of looking at things , as in common sense and several philosophical tendencies , or a set of ideas proposed by the dominant class of a society to...

 are defined in an idealized sense, what is described rarely if ever exists in practice. Most would not consider it unreasonable to label an economy that, while not being a perfect representation, very closely resembles an ideal by applying the rubric that denominates that ideal. However, when a system in question diverges to a significant extent from an idealized economic model
Model (macroeconomics)
A macroeconomic model is an analytical tool designed to describe the operation of the economy of a country or a region. These models are usually designed to examine the dynamics of aggregate quantities such as the total amount of goods and services produced, total income earned, the level of...

 or ideology
Ideology
An ideology is a set of ideas that constitutes one's goals, expectations, and actions. An ideology can be thought of as a comprehensive vision, as a way of looking at things , as in common sense and several philosophical tendencies , or a set of ideas proposed by the dominant class of a society to...

, the task of identifying it can become problematic. Hence, the term "mixed economy" was coined. As it is unlikely that an economy will contain a perfectly even mix, mixed economies are usually noted as being skewed towards either private ownership or public ownership, toward capitalism
Capitalism
Capitalism is an economic system that became dominant in the Western world following the demise of feudalism. There is no consensus on the precise definition nor on how the term should be used as a historical category...

 or socialism
Socialism
Socialism is an economic system characterized by social ownership of the means of production and cooperative management of the economy; or a political philosophy advocating such a system. "Social ownership" may refer to any one of, or a combination of, the following: cooperative enterprises,...

, or toward a market economy
Market economy
A market economy is an economy in which the prices of goods and services are determined in a free price system. This is often contrasted with a state-directed or planned economy. Market economies can range from hypothetically pure laissez-faire variants to an assortment of real-world mixed...

 or command economy in varying degrees.

There is not a consensus on which economies are capitalist, socialist, or mixed. It may be argued that the historical tendency of power holders in all times and places to limit the activities of market actors combined with the natural impossibility of monitoring and constraining all market actors has resulted in the fact that, as we understand a "mixed economy" being a combination of governmental enterprise and free-enterprise, nearly every economy to develop in human history meets this definition; though some systems may be so close to being completely one way or the other that to call them mixed is redundant and it is more meaningful just to call them a free market
Market economy
A market economy is an economy in which the prices of goods and services are determined in a free price system. This is often contrasted with a state-directed or planned economy. Market economies can range from hypothetically pure laissez-faire variants to an assortment of real-world mixed...

 economy or a command economy
Planned economy
A planned economy is an economic system in which decisions regarding production and investment are embodied in a plan formulated by a central authority, usually by a government agency...

.

Elements of a mixed economy


The elements of a mixed economy have been demonstrated to include a variety of freedoms
Freedom (political)
Political freedom is a central philosophy in Western history and political thought, and one of the most important features of democratic societies...

:



  • to possess means of production
    Means of production
    Means of production refers to physical, non-human inputs used in production—the factories, machines, and tools used to produce wealth — along with both infrastructural capital and natural capital. This includes the classical factors of production minus financial capital and minus human capital...

     (farms, factories, stores, etc.)
  • to participate in managerial decisions (cooperative
    Cooperative
    A cooperative is a business organization owned and operated by a group of individuals for their mutual benefit...

     and participatory economics
    Participatory economics
    Participatory economics, often abbreviated parecon, is an economic system proposed primarily by activist and political theorist Michael Albert and radical economist Robin Hahnel, among others. It uses participatory decision making as an economic mechanism to guide the production, consumption and...

    )
  • to travel
    Freedom of movement
    Freedom of movement, mobility rights or the right to travel is a human right concept that the constitutions of numerous states respect...

     (needed to transport all the items in commerce, to make deals in person, for workers and owners to go to where needed)
  • to buy
    Buy
    Buy may refer to:*Trade, exchange of goods and services*BUY , Burlington, North Carolina*Buy.com, a shopping website*Buy , a 1979 album by James White and the Contortions...

     (items for personal use, for resale; buy whole enterprises to make the organization that creates wealth a form of wealth itself)
  • to sell
    Sell
    Sell can refer to:*A verb relating to sales*Sell *One of several people named Edward Sell *Mary Elizabeth Sell, New York City Ballet dancer*Friedrich L...

     (same as buy)
  • to hire
    Recruitment
    Recruitment refers to the process of attracting, screening, and selecting qualified people for a job. For some components of the recruitment process, mid- and large-size organizations often retain professional recruiters or outsource some of the process to recruitment agencies.The recruitment...

     (to create organizations that create wealth)
  • to fire
    Termination of employment
    -Involuntary termination:Involuntary termination is the employee's departure at the hands of the employer. There are two basic types of involuntary termination, known often as being "fired" and "laid off." To be fired, as opposed to being laid off, is generally thought of to be the employee's...

     (to maintain organizations that create wealth)
  • to organize (private enterprise for profit, labor unions, workers' and professional associations, non-profit groups, religions, etc.)
  • to communicate (free speech, newspapers, books, advertisements, make deals, create business partners, create markets)
  • to protest
    Protest
    A protest is an expression of objection, by words or by actions, to particular events, policies or situations. Protests can take many different forms, from individual statements to mass demonstrations...

     peacefully (marches, petitions, sue the government, make laws friendly to profit making and workers alike, remove pointless inefficiencies to maximize wealth creation)


with tax-funded, subsidized
Subsidy
A subsidy is an assistance paid to a business or economic sector. Most subsidies are made by the government to producers or distributors in an industry to prevent the decline of that industry or an increase in the prices of its products or simply to encourage it to hire more labor A subsidy (also...

, or state-owned factors of production, infrastructure, and services:

  • libraries and other information
    Information
    Information in its most restricted technical sense is a message or collection of messages that consists of an ordered sequence of symbols, or it is the meaning that can be interpreted from such a message or collection of messages. Information can be recorded or transmitted. It can be recorded as...

     services
  • roads and other transportation services
  • schools and other education
    Education
    Education in its broadest, general sense is the means through which the aims and habits of a group of people lives on from one generation to the next. Generally, it occurs through any experience that has a formative effect on the way one thinks, feels, or acts...

     services
  • hospitals and other health
    Health
    Health is the level of functional or metabolic efficiency of a living being. In humans, it is the general condition of a person's mind, body and spirit, usually meaning to be free from illness, injury or pain...

     services
  • banks and other financial
    FINANCIAL
    FINANCIAL is the weekly English-language newspaper with offices in Tbilisi, Georgia and Kiev, Ukraine. Published by Intelligence Group LLC, FINANCIAL is focused on opinion leaders and top business decision-makers; It's about world’s largest companies, investing, careers, and small business. It is...

     services
  • telephone, mail and other communication
    Communication
    Communication is the activity of conveying meaningful information. Communication requires a sender, a message, and an intended recipient, although the receiver need not be present or aware of the sender's intent to communicate at the time of communication; thus communication can occur across vast...

     services
  • electricity and other energy
    Energy
    In physics, energy is an indirectly observed quantity. It is often understood as the ability a physical system has to do work on other physical systems...

     services (e.g. oil, gas)
  • water systems for drinking, agriculture, and waste disposal
  • subsidies to agriculture and other businesses
  • government-granted monopolies to otherwise private businesses
  • legal assistance
    Law
    Law is a system of rules and guidelines which are enforced through social institutions to govern behavior, wherever possible. It shapes politics, economics and society in numerous ways and serves as a social mediator of relations between people. Contract law regulates everything from buying a bus...

  • government-funded or state-run research and development agencies


and providing some autonomy over personal finances but including involuntary spending and investments such as transfer payments and other cash benefits such as:
  • welfare for the poor
  • social security
    Social security
    Social security is primarily a social insurance program providing social protection or protection against socially recognized conditions, including poverty, old age, disability, unemployment and others. Social security may refer to:...

     for the aged and infirm
  • government subsidies
    Subsidy
    A subsidy is an assistance paid to a business or economic sector. Most subsidies are made by the government to producers or distributors in an industry to prevent the decline of that industry or an increase in the prices of its products or simply to encourage it to hire more labor A subsidy (also...

     to business
  • mandatory insurance
    Insurance
    In law and economics, insurance is a form of risk management primarily used to hedge against the risk of a contingent, uncertain loss. Insurance is defined as the equitable transfer of the risk of a loss, from one entity to another, in exchange for payment. An insurer is a company selling the...

     (example: automobile)


and restricted by various laws, regulations:
  • environmental
    Environmental science
    Environmental science is an interdisciplinary academic field that integrates physical and biological sciences, to the study of the environment, and the solution of environmental problems...

     regulation (example: toxins in land, water, air)
  • labor regulation including minimum wage laws
  • consumer
    Consumer
    Consumer is a broad label for any individuals or households that use goods generated within the economy. The concept of a consumer occurs in different contexts, so that the usage and significance of the term may vary.-Economics and marketing:...

     regulation (example: product safety)
  • antitrust
    Antitrust
    The United States antitrust law is a body of laws that prohibits anti-competitive behavior and unfair business practices. Antitrust laws are intended to encourage competition in the marketplace. These competition laws make illegal certain practices deemed to hurt businesses or consumers or both,...

     laws
  • intellectual property
    Intellectual property
    Intellectual property is a term referring to a number of distinct types of creations of the mind for which a set of exclusive rights are recognized—and the corresponding fields of law...

     laws
  • incorporation
    Incorporation (business)
    Incorporation is the forming of a new corporation . The corporation may be a business, a non-profit organisation, sports club, or a government of a new city or town...

     laws
  • protectionism
    Protectionism
    Protectionism is the economic policy of restraining trade between states through methods such as tariffs on imported goods, restrictive quotas, and a variety of other government regulations designed to allow "fair competition" between imports and goods and services produced domestically.This...

  • import and export controls, such as tariffs and quotas


and tax
Tax
To tax is to impose a financial charge or other levy upon a taxpayer by a state or the functional equivalent of a state such that failure to pay is punishable by law. Taxes are also imposed by many subnational entities...

es and fees written or enforced with manipulation of the economy
Economy
An economy consists of the economic system of a country or other area; the labor, capital and land resources; and the manufacturing, trade, distribution, and consumption of goods and services of that area...

 in mind.

Relation to forms of government and other ideas


The mixed economy is most commonly associated with social democratic policies or governments led by social democratic parties. However, given the broad range of economic systems that can be described by the term, most forms of government are consistent with some form of mixed economy.

Authors John W. Houck and Oliver F. Williams of the University of Notre Dame
University of Notre Dame
The University of Notre Dame du Lac is a Catholic research university located in Notre Dame, an unincorporated community north of the city of South Bend, in St. Joseph County, Indiana, United States...

 have argued that Catholic social teaching
Catholic social teaching
Catholic social teaching is a body of doctrine developed by the Catholic Church on matters of poverty and wealth, economics, social organization and the role of the state...

 naturally leads to a mixed economy in terms of policy. They referred back to Pope Paul VI
Pope Paul VI
Paul VI , born Giovanni Battista Enrico Antonio Maria Montini , reigned as Pope of the Catholic Church from 21 June 1963 until his death on 6 August 1978. Succeeding Pope John XXIII, who had convened the Second Vatican Council, he decided to continue it...

's statement that government "should supply help to the members of the social body, but may never destroy or absorb them". They wrote that a socially just mixed economy involves labor, management, and the state working together through a pluralistic system that distributes economic power widely.

Historic examples


The American School
American School (economics)
The American School, also known as "National System", represents three different yet related constructs in politics, policy and philosophy. It was the American policy for the 1860s to the 1940s, waxing and waning in actual degrees and details of implementation...

 (also known as the National System) is the economic philosophy that dominated United States national policies from the time of the American Civil War
American Civil War
The American Civil War was a civil war fought in the United States of America. In response to the election of Abraham Lincoln as President of the United States, 11 southern slave states declared their secession from the United States and formed the Confederate States of America ; the other 25...

 until the mid-twentieth century. It consisted of a three core policy initiatives: protecting industry through high tariffs (1861–1932) (changing to subsidies and reciprocity from 1932-1970s), government investment in infrastructure through internal improvements, and a national bank
Bank
A bank is a financial institution that serves as a financial intermediary. The term "bank" may refer to one of several related types of entities:...

 to promote the growth of productive enterprises. During this period the United States grew into the largest economy in the world, surpassing England (though not the British Empire
British Empire
The British Empire comprised the dominions, colonies, protectorates, mandates and other territories ruled or administered by the United Kingdom. It originated with the overseas colonies and trading posts established by England in the late 16th and early 17th centuries. At its height, it was the...

) by 1880.

Dirigisme
Dirigisme
Dirigisme is an economy in which the government exerts strong directive influence. While the term has occasionally been applied to centrally planned economies, where the state effectively controls both production and allocation of resources , it originally had neither of these meanings when...

 is an economic policy initiated under Charles de Gaulle
Charles de Gaulle
Charles André Joseph Marie de Gaulle was a French general and statesman who led the Free French Forces during World War II. He later founded the French Fifth Republic in 1958 and served as its first President from 1959 to 1969....

 of France designating an economy where the government exerts strong directive influence. It involved state control of a minority of the industry, such as transportation, energy and telecommunication infrastructures, as well as various incentives for private corporations to merge or engage in certain projects. Under its influence France experienced what is called "Thirty Glorious Years" of profound economic growth.

Social market economy
Social market economy
The social market economy is the main economic model used in West Germany after World War II. It is based on the economic philosophy of Ordoliberalism from the Freiburg School...

 is the economic policy of modern Germany that steers a middle path between the goals of socialism
Socialism
Socialism is an economic system characterized by social ownership of the means of production and cooperative management of the economy; or a political philosophy advocating such a system. "Social ownership" may refer to any one of, or a combination of, the following: cooperative enterprises,...

 and capitalism
Capitalism
Capitalism is an economic system that became dominant in the Western world following the demise of feudalism. There is no consensus on the precise definition nor on how the term should be used as a historical category...

 within the framework of a private market economy and aims at maintaining a balance between a high rate of economic growth, low inflation, low levels of unemployment, good working conditions, public welfare and public services by using state intervention. Under its influence Germany has emerged from desolation and defeat to become an industrial giant within the European Union
European Union
The European Union is an economic and political union of 27 independent member states which are located primarily in Europe. The EU traces its origins from the European Coal and Steel Community and the European Economic Community , formed by six countries in 1958...

.

Mixed socialist economies


The notion of a mixed economy is not inclusive to capitalist economies - that is, economies structured upon capital accumulation
Capital accumulation
The accumulation of capital refers to the gathering or amassing of objects of value; the increase in wealth through concentration; or the creation of wealth. Capital is money or a financial asset invested for the purpose of making more money...

 and private, profit-seeking enterprises. Many different proposals for socialist economic systems call for a type of mixed economy, where multiple forms of ownership of the means of production co-exist with each other. For example, Alec Nove's conception of feasible socialism envisioned an economic system based on a combination of state-enterprises for large industries, worker and consumer cooperatives, private enterprises for small-scale operations, and individual enterprise.

Many proposals for market socialism
Market socialism
Market socialism refers to various economic systems where the means of production are either publicly owned or cooperatively owned and operated for a profit in a market economy. The profit generated by the firms system would be used to directly remunerate employees or would be the source of public...

 involve a role for both economic planning
Economic planning
Economic planning refers to any directing or planning of economic activity outside the mechanisisms of the market, in an attempt to achieve specific economic or social outcomes. Planning is an economic mechanism for resource allocation and decision-making in contrast with the market mechanism...

 and market forces in coordinating economic decisions.

See also

  • Economic system
    Economic system
    An economic system is the combination of the various agencies, entities that provide the economic structure that defines the social community. These agencies are joined by lines of trade and exchange along which goods, money etc. are continuously flowing. An example of such a system for a closed...

  • Third Way
    Third way (centrism)
    The Third Way refers to various political positions which try to reconcile right-wing and left-wing politics by advocating a varying synthesis of right-wing economic and left-wing social policies. Third Way approaches are commonly viewed from within the first- and second-way perspectives as...

  • Radical center
  • Centrism
    Centrism
    In politics, centrism is the ideal or the practice of promoting policies that lie different from the standard political left and political right. Most commonly, this is visualized as part of the one-dimensional political spectrum of left-right politics, with centrism landing in the middle between...

  • Distributism
    Distributism
    Distributism is a third-way economic philosophy formulated by such Catholic thinkers as G. K...

  • Nationalization
    Nationalization
    Nationalisation, also spelled nationalization, is the process of taking an industry or assets into government ownership by a national government or state. Nationalization usually refers to private assets, but may also mean assets owned by lower levels of government, such as municipalities, being...

  • Political economy
    Political economy
    Political economy originally was the term for studying production, buying, and selling, and their relations with law, custom, and government, as well as with the distribution of national income and wealth, including through the budget process. Political economy originated in moral philosophy...

  • Rule according to higher law
    Rule according to higher law
    The rule according to a higher law means that no written law may be enforced by the government unless it conforms with certain unwritten, universal principles of fairness, morality, and justice...

  • Public sector
    Public sector
    The public sector, sometimes referred to as the state sector, is a part of the state that deals with either the production, delivery and allocation of goods and services by and for the government or its citizens, whether national, regional or local/municipal.Examples of public sector activity range...

  • Public-private partnership
    Public-private partnership
    Public–private partnership describes a government service or private business venture which is funded and operated through a partnership of government and one or more private sector companies...

  • Social Democracy
    Social democracy
    Social democracy is a political ideology of the center-left on the political spectrum. Social democracy is officially a form of evolutionary reformist socialism. It supports class collaboration as the course to achieve socialism...

  • Statism
    Statism
    Statism is a term usually describing a political philosophy, whether of the right or the left, that emphasises the role of the state in politics or supports the use of the state to achieve economic, military or social goals...


Mixed economic systems

  • Corporatist economy
    Corporatism
    Corporatism, also known as corporativism, is a system of economic, political, or social organization that involves association of the people of society into corporate groups, such as agricultural, business, ethnic, labor, military, patronage, or scientific affiliations, on the basis of common...

  • Dirigisme
    Dirigisme
    Dirigisme is an economy in which the government exerts strong directive influence. While the term has occasionally been applied to centrally planned economies, where the state effectively controls both production and allocation of resources , it originally had neither of these meanings when...

  • Rhine Capitalism
    Rhine Capitalism
    Rhine capitalism or Rhenish capitalism is a contemporary economic order existing primarily in Western Europe. The term originates from the French economist and Chairman of the Board and CEO Assurances Générales de France , Michel Albert who first used it in his book Capitalisme contre Capitalisme...

  • Social market economy
    Social market economy
    The social market economy is the main economic model used in West Germany after World War II. It is based on the economic philosophy of Ordoliberalism from the Freiburg School...

  • Socialist market economy
    Socialist market economy
    The socialist market economy or socialist market economy with Chinese characteristics is the official term used to refer to the economic system of the People's Republic of China after the reforms of Deng Xiaoping. It is also referred to as socialism with Chinese characteristics...

  • Welfare state
    Welfare state
    A welfare state is a "concept of government in which the state plays a key role in the protection and promotion of the economic and social well-being of its citizens. It is based on the principles of equality of opportunity, equitable distribution of wealth, and public responsibility for those...


Further reading


  • Rosin, Kirk (“Economic theory and the welfare state: a survey and interpretation.” Journal of Economic Literature, 30(2): 741-803. 1992, a review essay looking at the economics literature
  • Buckwitz, Goerge D. (1991) America’s Welfare State: From Roosevelt to Reagan. The Johns Hopkins University Press.
  • Buchanan, James M. (1986) Liberty, Market and State: Political Economy in the 1980s New York University Press.
  • Gross, Kyle B. (1991) The Politics of State Expansion: War, State and Society in Twentieth-Century Britain. New York: Routledge.
  • Derthick, Martha and Paul J. Quirk (1985) The Politics of Deregulation. Washington, DC: The Brookings Institution.
  • Sanford Ikeda; Dynamics of the Mixed Economy: Toward a Theory of Interventionism London: Routledge 1997


Third way