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(From Wikipedia.com)

Market socialism is a type of economic system where the means of production are either publicly owned or socially owned as cooperatives and operated in a market economy . This differs from non-market socialism in that a market exists for allocating capital goods and the means of production. [1] [2] There are many models of market socialism. Depending on the specific model, profits generated by socially-owned firms may variously be used to directly remunerate employees, accrue to society at large as the source of public finance , or be distributed amongst the population in a social dividend . [3] Although models of socialism involving factor markets have existed since the early 19th century, the term "market socialism" only emerged in the 1920s during the Socialist calculation debate . [4]
Market socialism is distinguished from the concept of the mixed economy , because unlike the mixed economy, models of market socialism are complete and self-regulating systems. [5] Market socialism is also contrasted with social democratic policies implemented within capitalist market economies: while social democracy aims to achieve greater economic stability and equality through policy measures such as taxes, subsidies and social welfare programs; market socialism aims to achieve similar goals through changing patterns of enterprise ownership and management. [6]
Early models of market socialism trace their roots to the works of Adam Smith and the theories of classical economics . These consisted of proposals for cooperative enterprises operating in a free-market economy with the aim of eliminating exploitation by allowing individuals to receive the full product of their labor , while removing the market-distorting effects of concentrating ownership and wealth in the hands of private owners. [7] Among early advocates of market socialism wereRicardian socialist economists and mutualist philosophers.
Beginning in the early twentieth century, neoclassical economic theory provided the theoretical basis for more comprehensive models of market socialism. Early neoclassical models of socialism included a role for a central planning board (CPB) in setting prices equal marginal cost to achieve Pareto efficiency . Even though these early models did not rely on genuine markets, they were labeled "market socialist" for their utilization of financial prices and calculation. Alternative outlines for market socialism involve models where socially owned enterprises or producer co-operatives operate within free markets under the criterion of profitability. In recent models proposed by American neoclassical economists, public ownership of the means of production is achieved through public ownership of equity and social control of investment.
Market socialism has also been used to refer to reformed economic systems in Marxist-Leninist states , most notably in reference to the contemporary economy of thePeople's Republic of China , where a free price system is used for the allocation of capital goods in both the state and private sectors. However, Chinese political and economic proponents of the "socialist market economy " do not consider it to be a form of market socialism in the neoclassical sense, and many Western economists and political scientists question the degree to which this model constitutes a form of market socialism, often preferring to describe it as "state capitalism ".

Description

(From Wikipedia.com)

Market socialism is a type of economic system where the means of production are either publicly owned or socially owned as cooperatives and operated in a market economy . This differs from non-market socialism in that a market exists for allocating capital goods and the means of production. [1] [2] There are many models of market socialism. Depending on the specific model, profits generated by socially-owned firms may variously be used to directly remunerate employees, accrue to society at large as the source of public finance , or be distributed amongst the population in a social dividend . [3] Although models of socialism involving factor markets have existed since the early 19th century, the term "market socialism" only emerged in the 1920s during the Socialist calculation debate . [4]
Market socialism is distinguished from the concept of the mixed economy , because unlike the mixed economy, models of market socialism are complete and self-regulating systems. [5] Market socialism is also contrasted with social democratic policies implemented within capitalist market economies: while social democracy aims to achieve greater economic stability and equality through policy measures such as taxes, subsidies and social welfare programs; market socialism aims to achieve similar goals through changing patterns of enterprise ownership and management. [6]
Early models of market socialism trace their roots to the works of Adam Smith and the theories of classical economics . These consisted of proposals for cooperative enterprises operating in a free-market economy with the aim of eliminating exploitation by allowing individuals to receive the full product of their labor , while removing the market-distorting effects of concentrating ownership and wealth in the hands of private owners. [7] Among early advocates of market socialism wereRicardian socialist economists and mutualist philosophers.
Beginning in the early twentieth century, neoclassical economic theory provided the theoretical basis for more comprehensive models of market socialism. Early neoclassical models of socialism included a role for a central planning board (CPB) in setting prices equal marginal cost to achieve Pareto efficiency . Even though these early models did not rely on genuine markets, they were labeled "market socialist" for their utilization of financial prices and calculation. Alternative outlines for market socialism involve models where socially owned enterprises or producer co-operatives operate within free markets under the criterion of profitability. In recent models proposed by American neoclassical economists, public ownership of the means of production is achieved through public ownership of equity and social control of investment.
Market socialism has also been used to refer to reformed economic systems in Marxist-Leninist states , most notably in reference to the contemporary economy of thePeople's Republic of China , where a free price system is used for the allocation of capital goods in both the state and private sectors. However, Chinese political and economic proponents of the "socialist market economy " do not consider it to be a form of market socialism in the neoclassical sense, and many Western economists and political scientists question the degree to which this model constitutes a form of market socialism, often preferring to describe it as "state capitalism ".