Editing Economic system (section)

== Main types ==

=== Capitalism ===
[[Capitalism]] generally features the private ownership of the means of production ([[Capital (economics)|capital]]) and a [[market economy]] for coordination. [[Corporate capitalism]] refers to a capitalist marketplace characterized by the dominance of [[hierarchical]], [[bureaucratic]] [[corporation]]s.

[[Mercantilism]] was the dominant model in Western Europe from the 16th to 18th century. This encouraged [[imperialism]] and [[colonialism]] until economic and political changes resulted in global [[decolonization]]. Modern capitalism has favored [[free trade]] to take advantage of increased efficiency due to national [[comparative advantage]] and [[economies of scale]] in a larger, more universal market. Some critics{{who|date=August 2017}} have applied the term [[neo-colonialism]] to the power imbalance between multi-national corporations operating in a [[free market]] vs. seemingly impoverished people in [[Developing country|developing countries]].

=== Mixed economy ===

There is no precise definition of a "mixed economy". Theoretically, it may refer to an economic system that combines one of three characteristics: public and private ownership of industry, market-based allocation with economic planning, or free markets with state interventionism.

In practice, "mixed economy" generally refers to market economies with substantial state interventionism and/or sizable [[public sector]] alongside a dominant [[private sector]]. Actually, mixed economies gravitate more heavily to one end of the spectrum. Notable economic models and theories that have been described as a "mixed economy" include the following:
* [[Georgism]] – socialized rents on land
* [[Mixed economy]] (It can be categorized under many titles)
** [[American School (economics)|American School]]
**[[Developmental state]]
** [[Dirigisme]] (Government-directed capitalist economy)
**[[Distributism]]
** [[Indicative planning]], also known as a planned market economy
** [[Japanese post-war economic miracle|Japanese system]]
** [[Nordic model]] (Social democrat economics of Nordic countries)
** [[Progressive utilization theory]]
** [[Corporatism]] (economies based on tripartite negotiation between labor, capital, and the state)
** [[Social market economy]], also known as ''Soziale Marktwirtschaft'' (Mixed capitalist)
**[[New Economic Policy]] (Mixed socialist)
** [[State capitalism]] (Government-dominated capitalist economy)
**[[Socialist market economy|Socialist Market Economy]] (Mixed socialist)

=== Socialist economy ===
[[Socialist economics|Socialist economic systems]] (all of which feature [[social ownership]] of the [[means of production]]) can be subdivided by their coordinating mechanism (planning and markets) into [[Economic planning|planned socialist]] and [[market socialist]] systems. Additionally, [[socialism]] can be divided based on their property structures between those that are based on [[public ownership]], worker or consumer [[cooperative]]s and [[common ownership]] (i.e. non-ownership). [[Pure communism|Communism]] is a hypothetical stage of socialist development articulated by Karl Marx as "second stage socialism" in ''[[Critique of the Gotha Program]]'', whereby the economic output is distributed based on need and not simply on the basis of labor contribution.

The original conception of socialism involved the substitution of money as a unit of calculation and monetary prices as a whole with [[calculation in kind]] (or a valuation based on natural units), with business and financial decisions replaced by engineering and technical criteria for managing the economy. Fundamentally, this meant that socialism would operate under different economic dynamics than those of capitalism and the price system.<ref>{{cite book|last=Bockman|first=Johanna|title=Markets in the name of Socialism: The Left-Wing origins of Neoliberalism|publisher=Stanford University Press|year=2011|isbn=978-0-8047-7566-3|page=20|quote=According to nineteenth-century socialist views, socialism would function without capitalist economic categories – such as money, prices, interest, profits and rent – and thus would function according to laws other than those described by current economic science. While some socialists recognized the need for money and prices at least during the transition from capitalism to socialism, socialists more commonly believed that the socialist economy would soon administratively mobilize the economy in physical units without the use of prices or money.}}</ref> Later models of socialism developed by neoclassical economists (most notably [[Oskar Lange]] and [[Abba Lerner]]) were based on the use of notional prices derived from a trial-and-error approach to achieve market clearing prices on the part of a planning agency. These models of socialism were called "market socialism" because they included a role for markets, money, and prices.

The primary emphasis of socialist planned economies is to coordinate production to produce economic output to directly satisfy economic demand as opposed to the indirect mechanism of the profit system where satisfying needs is subordinate to the pursuit of profit; and to advance the [[productive forces]] of the economy in a more efficient manner while being immune to the perceived systemic inefficiencies ([[Business cycle|cyclical processes]]) and crisis of [[overproduction]] so that production would be subject to the needs of society as opposed to being ordered around [[capital accumulation]].<ref>{{cite web|title = Socialism: Still Impossible After All These Years|website = Mises.org|url = https://mises.org/journals/scholar/Boettke.pdf|first1 = Peter J.|last1= Boettke |first2= Peter T. |last2=Leeson|quote =The ultimate end of socialism was the 'end of history', in which perfect social harmony would permanently be established. Social harmony was to be achieved by the abolition of exploitation, the transcendence of alienation, and above all, the transformation of society from the 'kingdom of necessity' to the 'kingdom of freedom.' How would such a world be achieved? The socialists informed us that by rationalizing production and thus advancing material production beyond the bounds reachable under capitalism, socialism would usher mankind into a post-scarcity world.|archive-url = https://web.archive.org/web/20110928235402/http://mises.org/journals/scholar/Boettke.pdf |archive-date = 28 September 2011}}</ref><ref> ''Socialism and Calculation'', on worldsocialism.org. Retrieved February 15, 2010, from worldsocialism.org: http://www.worldsocialism.org/spgb/overview/calculation.pdf {{Webarchive |url=https://web.archive.org/web/20110607071929/http://www.worldsocialism.org/spgb/overview/calculation.pdf|date=2011-06-07}}: "Although money, and so monetary calculation, will disappear in socialism this does not mean that there will no longer be any need to make choices, evaluations and calculations...Wealth will be produced and distributed in its natural form of useful things, of objects that can serve to satisfy some human need or other. Not being produced for sale on a market, items of wealth will not acquire an exchange-value in addition to their use-value. In socialism their value, in the normal non-economic sense of the word, will not be their selling price nor the time needed to produce them but their usefulness. It is for this that they will be appreciated, evaluated, wanted. . . and produced."</ref>

In a pure socialist planned economy that involves different processes of resource allocation, production and means of quantifying value, the use of money would be replaced with a different measure of value and accounting tool that would embody more accurate information about an object or resource. In practice, the economic system of the former [[Soviet Union]] and [[Eastern Bloc]] operated as a [[command economy]], featuring a combination of [[state-owned enterprise]]s and [[central planning]] using the [[material balances]] method. The extent to which these economic systems achieved socialism or represented a viable alternative to capitalism is subject to debate.<ref>{{cite web|date=2005-04-09|title=What was the USSR? Part I: Trotsky and state capitalism|url=http://libcom.org/library/what-was-the-ussr-aufheben-1|access-date=2014-08-15|publisher=Libcom.org}}</ref>

In [[orthodox Marxism]], the [[mode of production]] is tantamount to the subject of this article, [[Base and superstructure|determining with a superstructure of relations]] the entirety of a given culture or stage of human development.