1. By concentrating resources, it can ensure the achievement of the most advanced positions in science and technology (the achievements of the USSR in the field of astronautics, nuclear weapons, etc.).

2. An administrative-command economy is able to ensure economic and social stability. Every person is guaranteed a job, stable and constantly increasing wages, free education and medical services, people's confidence in the future, etc.

3. The administrative-command economy proved its vitality in critical periods of human history (war, elimination of devastation, etc.).

Negative aspects of an administrative-command economy.

1. Excludes private ownership of economic resources.

2. Leaves a very narrow framework for free economic initiative and excludes free enterprise.

3. The state completely controls the production and distribution of products, as a result of which free market relationships between individual enterprises are excluded.

Mixed (modern) economy organically combines the advantages of market, administrative-command and even traditional economies and thereby, to a certain extent, eliminates the disadvantages of each of them or mitigates their negative consequences.

Mixed economy- a type of modern socio-economic system that is emerging in developed Western countries and some developing countries at the stage of transition to a post-industrial society. A mixed economy is multi-structured in nature; its basis is private property interacting with state property (20-25%).

A mixed economy has its own characteristics in different countries and at different stages of development. IN USA characterized by the fact that government regulation here is represented to a much lesser extent than in other countries, because the size of state property is small. The main position in the US economy is occupied by private capital, the development of which is stimulated and regulated by government agencies, legal norms, and the tax system. Therefore, mixed enterprises are less common here than in Europe.

Russia practically the first in the world to apply the experience of an administrative-command economy in the form of state socialism. At the present stage, Russia is beginning to use the main elements of a mixed economy.

Related information:

1. V2: Task 4. RESULTS OF THE FUNCTIONING OF THE NATIONAL ECONOMY AND THEIR MEASUREMENT
2. Zips: (American) Strategic import from Italy. Unindoctrinated mafioso “from the other side” to fill the ranks of the Family. See The other Side
3. Antimonopoly policy. In Western countries there are two forces that, to one degree or another, counteract competition and the absolute monopolization of the economy:
4. Banking system. Another factor actively working to accelerate the destruction of the economies of the CIS countries is the banking system

A command economy is a way of organizing the life of a country in which land, capital and almost all resources are state-owned. This system is well known to residents of the former Soviet Union. This is not surprising, because many of the states that were part of it have not been able to change it for several decades.

History of education

The command economy is a system that emerged as a result of a series of socialist revolutions that took place under the Marxist ideological banner. Its final model in the modern sense was developed by communist leaders: first V.I. Lenin, and then I.V. Stalin. The fifties and eighties of the last century marked the period of greatest dawn of the socialist camp. At that time, more than thirty percent of the planet’s inhabitants lived in its constituent countries. In this regard, it is not surprising that, according to many scientists, the command economy is the largest economic experiment on Earth in human history. At the same time, many of the researchers forget that it began with the harsh suppression of the slightest civil liberties, and its implementation entailed enormous sacrifices.

Marxist theory

Based on the theory of Karl Marx, the only way to significantly increase the well-being and well-being of mankind is to eliminate the concept of private property, eliminate any manifestations of competition and carry out all state activities exclusively on the basis of a generally binding plan. However, it must be developed by the government based on scientific data. The roots of this theory can be found in the Middle Ages, in the works of the authors of so-called social utopias. At that time, these kinds of ideas failed, but at the beginning of the twentieth century, after the formation of the socialist camp, the government of the Soviet Union began to implement them in practice.

Signs

The main feature of a command economy is the shortage of some (or even many) goods. If they are on sale, then, regardless of the place of sale, as a rule, they do not differ from each other in quality. In this case, the government proceeds from the consideration that the buyer will still buy what is available. Thus, it is not surprising that there is no need to manufacture more expensive products and build similar stores on every street.

The next sign of a command economy is the absolute absence of an oversupply of manufactured goods under any conditions. The explanation for this is very simple and lies in the fact that the government of a state with such a system will under no circumstances allow the irrational use of its own resources.

It should also be noted that a country with such an economic system provides constant support to state-owned enterprises. It is expressed by clear planning of break-even sales markets, a loyal tax policy, as well as constant subsidies. Another significant feature of a command economy is the very appropriate use of labor resources in the enterprises mentioned above. This fact can be explained by the fact that, due to the absence of excess production, the need to overwork personnel and assign overtime hours is eliminated.

Property in a command economy

For countries that have a command economic system, it is typical that all production organizations are in the hands of government bodies. At the same time, there are enterprises with municipal or national ownership. Cooperatives also have their place in the system. At the same time, the latter form of ownership does not apply to production companies that generate profit. It applies only to such economic entities that can provide individual benefits for citizens. This may include housing funds, preschool institutions, garages, and so on.

Flaws

Almost all the problems of a command economy stem from the fact that the highest authority of the country controls production. At the same time, all subjects of the state economy, in fact, are in equal conditions and rights. This leads to the fact that even the slightest inclinations of a competitive environment are reduced to zero. Based on the fact that this will not bring greater material results, the desire of entrepreneurs to improve the quality of their products is also leveled. Due to the fact that all goods produced in the country are more or less evenly distributed among all regions, the wages of the working class are in the maximum possible level of equality. Thus, there can be no talk of the desire of enterprise personnel to improve the quality of their own work. The whole problem in this case comes down to the fact that no matter how hard a person works, he will not receive a salary that goes beyond the salary in one category or another.

Positive sides

Despite all the negative aspects of the system that were discussed earlier, there are also some advantages of a command economy. Its main “advantage” can be called the absence of the need for financial and labor costs to promote products on the market. Based on the fact that the government is a monopolist in the commercial market, there is no competition. In other words, the goods will be sold in any case, since there is a state quota.

Another great advantage of the planned-command economic system is the absence of class divisions within society. Due to relatively equal wages, in any state where it prevails, there are no very rich citizens and poor people. It would also be correct to note that many problems characteristic of a market economy can be easily solved using the planned-command method.

Population life

The command economic system has nothing to do with basic human needs. The circulation of products in society is quite simple. The decision on the production of goods and their sectoral distribution is made only by the government. Products are distributed across all regions of the country based on the idea that the population of each of them evenly consumes not only essential goods (including food and medicine), but also clothing and household appliances in full accordance with the volumes produced. As practice shows, this kind of approach cannot be called correct, because those goods that are not at all in demand in one area may be vital in a neighboring region. Even such features of a command economy did not prevent it from thriving very successfully even in many strong states. As for the welfare of citizens, the salary of each working person is proportional to the volume of his work. At the same time, the average salary in such countries is quite low.

Examples of command economy countries

The very first and most famous state in history to use a command economy is the Soviet Union, which switched to it back in 1917. The peak of development of such a system fell in the fifties of the last century. At that time, a terrible production crisis reigned on the planet. In this regard, the USSR, Cuba, China and other socialist countries have become striking examples of this method of organizing the economic life of the state. At present, it is difficult to judge and answer unequivocally how effective it was at that moment. On the one hand, the industry found itself in a catastrophically difficult situation, which could not be resolved through the ratio of supply and demand alone, and on the other hand, it was difficult to find a more rational way to overcome the current situation than government intervention.

Be that as it may, the best indicator of the quality of economic systems of that time is the rate of GDP growth in the first decades after the war. If we analyze them, we can see that the capitalist Western European states were many steps ahead of the countries of the socialist camp in this indicator. Over time, the gap in their level of development only increased.

Difficulty exiting

The planned and command development of the Soviet Union, which lasted more than eighty years, led to the fact that the real level of the state at the beginning of the nineties of the last century was, to put it mildly, deplorable. This was reflected in the very low quality and uncompetitiveness of manufactured products, a decrease in the well-being and life expectancy of the population, the obsolescence of the manufacturing sector, as well as severe environmental pollution. The main reason for all this was the features of the command economy, which were discussed in more detail earlier.

Be that as it may, the process of transition to a market economic system is not as simple and fast as it might seem at first glance. No state can become successful within a few years. In this regard, in theory there is a concept of the so-called transition economy. It is characterized by uncertainty, instability and changes in the entire economic structure of the state. Something similar can now be observed in some countries of the former socialist camp.

Conclusion

To summarize, it should be noted that a command economy is a way of organizing government life, which is often called socialism. Within its framework, the government plays a monopolistic role in regulating the economic life of the country. It is the government that decides on the volume of production of a particular type of product, as well as its cost on the market. With all this, such data are established not on the basis of the real relationship between supply and demand, but solely on the basis of long-term statistical data, on the basis of which plans are established. Although such a model of state development has some advantages, as practice shows, in a market economy and competition, any country develops much more efficiently.

A command economy is an economic system in which the state plays the main role in regulating it. In this system, the state determines what products should be produced and in what quantities, for whom to produce them, and how to produce them. Why is the state assigned the role of the main regulator in the economy? Because in this economic system, state ownership of all basic means of production predominates, that is, the bulk of economic resources are owned by the entire population living in the country. On behalf of the population, the state manages the distribution of all basic economic resources, as well as their use.

Due to little or no private ownership of the means of production, there is no market in a command economy. It is being replaced by centralized planning, distribution and supply. However, there are elements of the market here. Produced products are considered goods, but prices for them are set by the state. There is a network of trade institutions that act as intermediaries between sellers (state or cooperative enterprises) and buyers (enterprises, institutions or the public).

The advantages of a command economy are:

1) minimum uncertainty in changes in the economic situation in the near future, relatively stable economic development;

2) the possibility of setting social goals for the economy and achieving them;

3) the absence of sharp differences in the income levels of the population between its various groups, which contributes to a more even development of all layers of society;

4) the ability to maintain a stable level of employment.

But, like any economic system, a command economy has its drawbacks:

1) lack of freedom of choice of goods (in particular, means of production) for sellers and buyers - everything is planned and distributed in advance;

2) the need to create a large, complex bureaucratic structure of economic management, which often interferes with the rapid adoption of operational decisions;

3) subjectivity in economic management, which leads to imbalance and disproportionate development of industries;

4) alienation of owners (population) from property (means of production) and lack of competition (competition), which leads to lack of initiative among workers and insufficient incentives for more efficient use of economic resources; as a result - underutilization of the achievements of scientific and technological progress, decreased efficiency, and stagnation in the economy.

An example of a command economy is the economic system in the former Soviet Union and in countries of the socialist direction of development.

Planned economy (administrative command system) previously dominated in the USSR, countries of Eastern Europe, and a number of Asian states.

The characteristic features of the ACS are public (and in reality, state) ownership of almost all economic resources, monopolization and bureaucratization of the economy in specific forms, centralized economic planning as the basis of the economic mechanism.

The economic mechanism of the AKS has a number of features. It assumes, firstly, direct management of all enterprises from a single center - the highest echelons of state power, which negates the independence of economic entities. Secondly, the state completely controls the production and distribution of products, as a result of which free market relationships between individual farms are excluded. Thirdly, the state apparatus manages economic activities using mainly administrative and administrative (command) methods, which undermines material interest in the results of labor.

Complete nationalization of the economy causes monopolization of production and sales of products on an unprecedented scale. Giant monopolies, established in all areas of the national economy and supported by ministries and departments, in the absence of competition, do not care about the introduction of new equipment and technology. A deficit economy generated by a monopoly is characterized by the absence of normal material and human reserves in case of an imbalance in the economy.

In countries with ACN, solving general economic problems had its own specific features. In accordance with the prevailing ideological guidelines, the task of determining the volume and structure of production was considered too serious and responsible to transfer its decision to the direct producers themselves - industrial enterprises, state farms and collective farms.

The centralized distribution of material goods, labor and financial resources was carried out without the participation of direct producers and consumers, in accordance with pre-selected public goals and criteria, on the basis of centralized planning. A significant part of the resources, in accordance with the prevailing ideological guidelines, was directed to the development of the military-industrial complex.

The distribution of created products between production participants was strictly regulated by central authorities through a universally applied tariff system, as well as centrally approved standards for funds in the wage fund. This led to the predominance of an equal approach to wages

Main features:

state ownership of almost all economic resources;

strong monopolization and bureaucratization of the economy;

centralized, directive economic planning as the basis of the economic mechanism.

Main features of the economic mechanism:

direct management of all enterprises from a single center;

the state fully controls the production and distribution of products;

The state apparatus manages economic activities using predominantly administrative-command methods.

This type of economic system is typical for: Cuba, Vietnam, North Korea. A centralized economy with an overwhelming share of the public sector, it is largely dependent on agriculture and foreign trade.

Command economy

The pure capitalism presented above has its antipode (opposite) in the form of a centralized (command-administrative) system, characterized by state ownership of all material resources and the adoption of important economic decisions through collective meetings and centralized economic planning. In other words, the means of production (land, capital) are concentrated in the hands of the state - the leading economic entity, and economic power can be spoken of as centralized. It is important to take into account that the market does not determine the balance of economic forces (it does not affect which companies produce what, which of them will withstand competition); prices for goods and services are determined by the government. The central planning body (CPO) carries out the distribution of initially available and finished products; its competence includes the task of what products should be produced and in what quantity, what the quality of these products will be, from what resources and raw materials they will be produced. Once these issues have been resolved, the CPO transmits the order (implements directives) to specific enterprises indicating the necessary details. It is worth noting that enterprises located in the country also belong to the state.

A significant advantage of this model over others is the achievement of conditions conducive to the absence of obvious unemployment due to the centralized distribution of resources and accounting, in particular, of all available labor resources. Another point is that due to strict centralization of management, it is possible to control the distribution of income among the population.

At the first stage of economic planning, the task of the central planning authority is to draw up a five-year plan for the development of the country's economy as a whole. Subsequently, this plan is refined and detailed, divided into more detailed points, and ultimately ready-made plans for economic sectors and individual enterprises are obtained. At the same time, it is worth noting the presence of feedback from these very enterprises - at the stage of designing plans, they themselves give assessments and comments on the optimality of the required indicators. The ultimately approved plan must be implemented almost without question.

However, it would be wrong not to talk about the difficulties in implementing this model. Among the priorities is the problem, directly, of centralized economic management, as one of the most difficult. And here an important place is given to the problem of informing government planning bodies about the state of the economy directly at a given point in time. Indeed, in this case, it is very difficult to assess the influence of numerous factors and track changes in indicators characterizing the state of the economy (production costs, consumption growth, resource consumption). At the same time, even statistically collected information changes quickly, which makes planning often inconsistent with the times. The higher the degree of centralization of management, the more distorted the adequacy of economic indicators from bottom to top is. Often, many economic institutions deliberately distort the obtained indicators in order to ultimately appear to management in the most favorable light.

Problems arise in a planned economy when trying to introduce new technologies into production or when it comes to releasing new products. This is explained by the control of the enterprise management by higher-level management and subordination exclusively to its directives (commands), which cannot always be assessed objectively. It is in a market economy that enterprises strive to minimize costs and put on the market a new product that is superior to competitors and allows them to earn a profit, keeping the company afloat in a constantly changing market environment. In the directive model, however, flaws in the management structure and an inadequate level of awareness do not allow adequately increasing the production efficiency of a particular enterprise in proportion to its potential.

To summarize, it is worth noting the following advantages of this model:

Centralized management makes it possible to concentrate funds and other resources in certain areas of highest priority at the moment

Creating social stability, a feeling of “confidence in the future.”

Of the minuses it is worth noting:

Low level of satisfaction of consumer needs

Lack of choice in both production and consumption (including shortages of consumer goods)

Achievements of scientific and technological progress are not always implemented in a timely manner

We, as residents of the post-Soviet space, are extremely close to the command economy as a system, which we have been trying to get out of for several decades. Let's look at why it is so difficult to move to the market, and how the planned regime is typical for both sides of the business.

Concept and types of economic systems

Economic systems, from a theoretical point of view, are a collection of various market elements, which, when interacting with each other, form a single structure within the country, which takes into account not only aspects of production and consumption, but also the distribution of goods and labor resources.

Modern systems are divided into three types:

• market;
• team;
• traditional economy.

Although from a historical point of view, if we consider the development of the market in stages, they will have the following classification:

• pre-industrial economy (times of prosperity of agriculture as the main niche of production);
• industrial (appeared with the birth of industry);
• post-industrial (still developing today, characterized by the prosperity of the service sector and information technology).

But let's return to the modern understanding of the economic system. Let's try to first highlight the main key points that characterize this or that type, and the table “Market, command, traditional economy: main features”, which is presented below, will help us with this.

Well, now let’s take a closer look at each point.

Characteristics of a market economy

This is the most popular system today, which is characterized by the free formation of prices for products and services depending on the relationship between supply and demand. The state, as a rule, does not interfere at all in economic relations between business entities, and all government participation consists in the creation of regulatory legal acts. The authorities can only ensure that the latter are respected.

This is why market and command economies are absolutely contradictory systems, but more on that later.

But as far as state non-interference in market processes is concerned, this issue is very controversial. The relationship between supply and demand cannot always reach a so-called consensus. For example, during periods of crisis there is absolutely no demand for some groups of goods and services, so the only buyer can be the government sector, but the market system of the economy completely excludes this possibility.

Concept of traditional economy

Traditional and command economies are not the same thing. However, both systems have some similar features, although the first is more aimed at maximizing the development of the national economy’s own wealth, therefore its distinctive feature is the most optimal development of rural industry.

As for values ​​in this system, banknotes are not as important as, for example, essential goods. Therefore, the traditional economy is often characterized by relations that we are accustomed to calling barter exchange.

At first glance, it seems that countries with such a system of economic relations no longer exist, but in the vastness of Central Africa there are more than enough of them.

Concept of command economy

First, let's define what principles a command-administrative economy is based on, or as it is commonly called - a planned economy.

Within this system, the state itself plays an important role in the economic regulation of the country. It is the authorities who decide which goods, in what quantities and at what price to produce and sell. These data are not taken from the real relationship between supply and demand, but from planned indicators according to long-term statistical data.

Signs of a command economy

Under a planned economic system, there is never an oversupply of goods produced, since the government is unlikely to allow its own resources to be wasted. Therefore, often the main symptom of a command economy is the shortage of certain goods. Moreover, as a rule, this product is of identical quality everywhere, since in such countries there is no point in building the same type of stores on every street and producing more expensive products, because anyway the buyer has no choice - he will take whatever is left on the shelves.

Also a sign of a command economy is the appropriate use of labor resources. The explanation for this is very simple: there is no overproduction - no overtime hours per shift, no overworking of personnel.

Well, thanks to the constant support of entrepreneurship by the state, the following signs of a command economy take place:

• permanent subsidies;
• loyal taxation;
• clear planning of a break-even sales market.

So, we not only determined the foundations of this economic system, but also assigned a role to state influence in it. Now let's try to understand what production itself and property as such mean for entrepreneurs under a planned regime.

The role of property in a command economy

As we have already found out, a market economy is aimed at private production, while a traditional one is aimed at collective production. Well, what features of a command economy indicate the advantage of one or another form of ownership in this system? It is easy to guess that all production organizations overwhelmingly belong to government agencies. Here, ownership rights are divided into both national and municipal scales.

As for cooperative forms of ownership, they also take place in a command economic system, but, as a rule, they do not apply to production organizations from which financial profit can be derived, but to economic entities that obtain their own benefits. In other words, cooperative housing funds, garages, and preschool institutions are quite common in a planned economic system.

Private property in a command-administrative society extends to property intended for running a household and nothing more.

Planned economy in the life of the population

As mentioned above, a command economy is in no way related to human needs. In other words, if we simplify the process of this system to two actions, we will get approximately the following algorithm for the circulation of products in society.

1. The government decides in what proportion, according to industry shares, products should be produced.
2. The produced goods are distributed throughout the entire territory of the state, taking into account the assumption that the population evenly consumes in each geographical area of ​​the country both food and medicine, and even household appliances in accordance with the produced volumes.

We all understand that this approach is not entirely correct - perhaps someone in the south of the country does not need a new TV, but needs more dishwashing detergent, and some in the north need more warm socks. But these are the realities of a planned economy, which at one time flourished more or less successfully in the vastness of many powerful states.

As for the general welfare of the population, under a command system each person earns in proportion to the amount of work he performs. But despite this, the average salary in the country remains quite low.

Examples of countries with planned economic systems

The command-administrative economy began its active and fruitful development in post-war times, namely in the 50s of the twentieth century. At that time, the world was subject to a terrible production crisis, and therefore such socialist countries as China, Cuba, and the closest to us in spirit and understanding - the USSR, which switched to planned measures back in 1917, became a striking example of this system.

It is difficult to say unequivocally whether this solution was effective in those days. Considering that the entire industry was in a deplorable state, and it was problematic to regulate anything based on the same ratio of supply and demand, then it is likely that the policy of government intervention at that time was the best way out of the current situation.

However, if we compare statistical data on GDP growth for a couple of post-war decades between the countries of Western Europe and the states that represented socialism, we will see that the latter lagged behind in growth rates by several times.

Positive aspects of a command economy

Despite all the above factors, it cannot be said that the command system of the economy does not have any advantages.

The manufacturer does not need to spend extra financial or labor resources to promote his product - he always has a quota allocated by the state that the population needs and will definitely buy. And they will do this because the government is the only monopolist on the commercial market, so there can be no competition a priori.

As for society, a planned economy excludes any class divisions within society. In the reality of this system, there are no poor people and no too rich, since everyone’s wages tend to the average.

Theoretically, it can be said that many problems present in a market economy are easily solved within the framework of a command order.

Disadvantages of a command economy

Due to the fact that all production is directed by the highest authority, and this is done on equal rights and conditions in relation to each business entity, any inclinations of a competitive environment are excluded. Therefore, a command economy nullifies any desire of an entrepreneur to improve his product, because no matter how hard he tries, he still cannot get more material wealth.

And since all products are distributed evenly throughout the country, wages are equalized as much as possible, so the staff completely loses any interest in improving the quality of their work. If an employee of this category is supposed to have a salary within a certain amount, then no matter how specialist he is in his field, he will not be able to receive more.

Difficulties in leaving the planned economy

It is difficult to say which system is better - a market or command economy. Each is good in its own way under certain conditions: sometimes government intervention is extremely necessary, and sometimes the quality of baby food produced in competitive conditions is more important than equal distribution of milk throughout the country.

In any case, the period of transition from a planned system to a market system is extremely difficult. We all witnessed how this affected practice after the collapse of the USSR. It is clear that every state cannot become successful in a matter of years, which is why in political economic theory there is such a thing as a transition economy. It is characterized by instability, uncertainty and deformation of the entire economic national structure, but in our world everything is for society, so we must build further business ourselves.

^ The main features of an administrative-command economy:

1. 
   basis - state property;
2. 
   absoluteization of state ownership of economic and natural resources;
3. 
   strict centralization in the distribution of economic resources and results of economic activity;

4) significant restrictions or prohibitions on private entrepreneurship.

^ Positive aspects of an administrative-command economy.

1. 
   By concentrating resources, it can ensure the achievement of the most advanced positions in science and technology (the achievements of the USSR in the field of astronautics, nuclear weapons, etc.).
2. 
   An administrative-command economy is able to ensure economic and social stability. Every person is guaranteed a job, stable and constantly increasing wages, free education and medical services, people's confidence in the future, etc.
3. 
   The administrative-command economy proved its vitality in critical periods of human history (war, elimination of devastation, etc.).

Negative aspects of an administrative-command economy.

1. 
   Excludes private ownership of economic resources.
2. 
   It leaves a very narrow framework for free economic initiative and excludes free enterprise.
3. 
   The state completely controls the production and distribution of products, as a result of which free market relationships between individual enterprises are excluded.

^ Mixed economy organically combines the advantages of market, administrative-command and even traditional economies and thereby, to a certain extent, eliminates the disadvantages of each of them or mitigates their negative consequences.

^ Mixed economy - a type of modern socio-economic system that is emerging in developed Western countries and some developing countries at the stage of transition to a post-industrial society. A mixed economy is multi-structured in nature; its basis is private property interacting with state property (20-25%).

On the basis of various forms of ownership, various types of economy and entrepreneurship operate (large, medium, small and individual entrepreneurship; state and municipal enterprises (organizations, institutions)).

A mixed economy is a market system with its inherent social orientation of the economy and society as a whole. The interests of the individual with its multifaceted needs are put at the center of the country's socio-economic development.

A mixed economy has its own characteristics in different countries and at different stages of development. Thus, the mixed economy in the United States is characterized by the fact that government regulation is represented here to a much lesser extent than in other countries, because the size of state property is small. The main position in the US economy is occupied by private capital, the development of which is stimulated and regulated by government agencies, legal norms, and the tax system. Therefore, mixed enterprises are less common here than in Europe. Nevertheless, a certain form of public-private entrepreneurship has developed in the United States through a system of government laws.

Russia was practically the first in the world to apply the experience of an administrative-command economy in the form of state socialism. At the present stage, Russia is beginning to use the main elements of a mixed economy.

2.2. Models of economic systems:

American, Swedish, Japanese. Russian model of transition economy

Each economic system is characterized by its own national models of economic organization. Let's consider some of the most famous national models of economic systems.

^ American model built on a system of encouraging entrepreneurial activity, developing education and culture, and enriching the most active part of the population. Low-income segments of the population are provided with various benefits and allowances to maintain a minimum standard of living. This model is based on a high level of labor productivity and mass orientation towards achieving personal success. The problem of social equality does not arise here at all.

^ Swedish model It is distinguished by a strong social orientation, aimed at reducing wealth inequality through the redistribution of national income in favor of the least affluent segments of the population. This model means that the production function falls on private enterprises operating on a competitive market basis, and the function of ensuring a high standard of living (including employment, education, social insurance) and many elements of infrastructure (transport, R&D) falls on the state.

The main thing for the Swedish model is a social orientation due to high taxation (more than 50% of GNP). The advantage of the Swedish model is the combination of relatively high rates of economic growth with a high level of full employment and ensuring the well-being of the population. The country has kept unemployment to a minimum, differences in incomes of the population are small, and the level of social security for citizens is high.

^ Japanese model characterized by some lag in the standard of living of the population (including the level of wages) from the growth of labor productivity. Due to this, they achieve a reduction in production costs and a sharp increase in their competitiveness in the world market. Such a model is possible only with an exceptionally high development of national self-awareness, the priority of the interests of society to the detriment of the interests of a particular person, and the willingness of the population to make certain sacrifices for the sake of the country’s prosperity. Another feature of the Japanese development model is associated with the active role of the state in modernizing the economy.

The Japanese economic model is characterized by advanced planning and coordination between the government and the private sector. Economic planning of the state is advisory in nature. Plans are government programs that orient and mobilize individual parts of the economy to accomplish national goals. The Japanese model is characterized by the preservation of its traditions and, at the same time, active borrowing from other countries of everything that is needed for the development of the country.

^ Russian model of transition economy. After the long-term dominance of the administrative-command system in the Russian economy in the late 1980s and early 1990s. the transition to market relations began. The main task of the Russian model of transition economy is the formation of an effective market economy with a social orientation.

^ The conditions for the transition to a market economy were unfavorable for Russia. Among them:

1. 
   high degree of nationalization of the economy;
2. 
   the almost complete absence of a legal private sector with an increase in the shadow economy;
3. 
   the long existence of a non-market economy, which weakened the economic initiative of the majority of the population;
4. 
   the distorted structure of the national economy, where the military-industrial complex played the leading role, and the role of other sectors of the national economy was reduced;
5. 
   uncompetitiveness of industrial and agricultural sectors.

Basic conditions for the formation of a market economy in Russia:

1. 
   development of private entrepreneurship based on private property;
2. 
   creating a competitive environment for all business entities;
3. 
   an effective state that provides reliable protection of property rights and creates conditions for effective growth;

2.3. The main economic problems of society. What to produce? How to produce? For whom to produce?

Any society, no matter how rich or poor it is, grapples with three fundamental questions of economics: what goods and services need to be produced, how and for whom. These three fundamental questions of economics are decisive (Figure 2.1).

^ What goods and services must be produced and in what quantities? An individual can provide himself with the necessary goods and services in various ways: produce them himself, exchange them for other goods, or receive them as a gift. Society as a whole cannot have everything immediately. Because of this, it must decide what it would like to have immediately, what it could wait to get, and what it could refuse altogether. What needs to be produced at the moment: ice cream or shirts? Slightly

How many expensive quality shirts or many cheap ones? Is it necessary to produce fewer consumer goods or is it necessary to produce more production goods (machines, machines, equipment, etc.), which will increase production and consumption in the future?

Sometimes the choice can be quite difficult. There are underdeveloped countries that are so poor that the efforts of most of the workforce are spent just to feed AND clothe the population. In such countries, in order to raise the living standards of the population, it is necessary to increase production volumes, but this requires the restructuring of the national economy and the modernization of production.

^ How should goods and services be produced? There are different options for the production of the entire set of goods, as well as each economic good separately. By whom, from what resources, using what technology should they be produced? Through what organization of production? There is far more than one option for building a specific house, school, college, or car. The building can be multi-story or one-story; the car can be assembled on a conveyor belt or manually. Some buildings are built by private individuals, others by the state. The decision to produce cars in one country is made by a government agency, in another - by private firms.

^ Who should the product be made for? Who can benefit from goods and services produced V country? Since the quantity of goods and services produced is limited, the problem of their distribution arises. To satisfy all needs, it is necessary to understand the mechanism of product distribution. Who should use and benefit from these products and services? Should all members of society receive the same share or not? What should be given priority - intelligence or physical strength? Will the sick and old people have enough to eat or will they be abandoned to their fate? Solutions to these problems determine the goals of society and the incentives for its development.

Basic economic problems are solved differently in different socio-economic systems. For example, in a market economy, all answers to basic economic questions (what, how, for whom) are determined by the market: demand, supply, price, profit, competition.

“What” is decided by effective demand, the vote of money. The consumer himself decides what he is willing to pay money for. The manufacturer himself will strive to satisfy the desires of the consumer.

The “how” is decided by the manufacturer, who seeks to make more profit. Since price setting does not depend solely on him, to achieve his goal in a competitive environment, the manufacturer must produce and sell as many goods as possible and at a lower price than his competitors.

“For whom” is decided in favor of different consumer groups based on their income.

Brief conclusions

1. 
   In the last one and a half to two centuries, the following systems have operated in the world: market economy of free competition, modern market economy, administrative-command and traditional economies. In the last one and a half to two decades, a mixed economy has emerged.
2. 
   Each system has its own national models of organizing economic development, because countries differ in their level of economic development, social And national conditions.
3. 
   The Russian model of a transition economy has the following characteristic features: a powerful public sector, a small share of small and medium-sized businesses, an uneven transition to market relations in various industries and regions of the country, and high criminalization of the economy. *
4. 
   The basic issues of economics (what, how, for whom) are resolved in different socio-economic systems in different ways depending on the socio-economic development of the country.

Economic training

Key terms and concepts /d

Economic system; types of economic systems: traditional economy, market economy, administrative-command (centrally planned) economy, mixed economy; models of economic systems: Japanese, South Korean, American, Swedish; Russian transition economy; basic economic questions: what, how, why.

Test questions and assignments

1. 
   What types of economic systems do you know and what is their essence?

1. 
   Reveal the essence of models of economic systems.

1. 
   What are the features of the Russian model of transition economy (as opposed to administrative-command to market)?
2. 
   How is the Japanese model different from the South Korean one? What elements of these models can be used in Russia to create a market economy?
3. 
   What are the three main questions of economics that economic theory constantly seeks to answer and what is their content?
4. 
   How are the three main questions of economics (what, how, for whom) resolved in a market economy and an administrative-command economy?
5. 
   What are the features of the development of economic systems at the present stage?

Exercise. Compose an economic crossword using the following terms: types, systems, tradition, customs, community, entrepreneurship, property, diversity, self-regulation, inequality, plan, planning, administration, centralization, concentration, state, models.

Tests

^ Choose the correct answer.

1. Features of Russia in comparison with other countries
with a transition economy consists of:

a) high share of the military-industrial complex in the people
nom economy;

b) widespread handicraft production;

c) the presence of free economic zones;

d) competitiveness of industrial sectors..

^ 2. We can talk about the predominance of administrators in the country
rational command system based on the degree of government participation
states in economic processes when:

a) government intervention in the economy is minimal;

b) the state controls the production of the main part of it
goods and services within the public sector;

c) the state, maintaining control over certain sectors of the ecology
nomics, while at the same time encouraging the development of the private sector;

d) all answers are correct.