Traditional economic system model. National models of economic systems
Each economic system is characterized by its own national models of economic organization, as countries differ in the originality of history, level of economic development, social and national conditions. So, the administrative-command economic system was characterized by the Soviet, Chinese, Yugoslav and other models. Different models are also inherent in the modern capitalist system.
The study of these models is of practical importance for the development of a model for the development of Russia. In this case, we are not talking about copying someone else's experience, but about its creative use, taking into account the specific conditions prevailing in our country.
Let's consider the most famous national models of economic systems. Of these, the most vividly expressed DII value of the command and control system is the Chinese model.
Chinese model connected with the reform of agriculture - the transition from "people's communes" to the system of family contracts. This process was completed by the end of 1984. Family peasant farms were formed on the land transferred to them for use for 15-20 years, and in some places up to 30 years. Of the products manufactured, part is handed over to the state under contracts, part - at the expense of taxes, part - to the funds of local authorities, and the remaining products are used at their own discretion.
In modern conditions, small family peasant farms are being combined into larger ones. This is dictated by the competition. There are various forms of cooperation in the sphere of circulation and production, land is concentrated in the hands of strong peasant farms with the hiring of labor.
After the agrarian reform, urban reform began in 1984. A "mixed model" is being introduced. Along with state regulation, there is a market mechanism for regulating the economy. At the same time, the main form of ownership is public ownership of the most important means of production and centralized planning is carried out at the macro level. Market regulation is mainly used at the micro level. Particular attention is paid to combining the interests of the state, the enterprise and the individual worker. There is a practice of leasing enterprises in a contract to collectives and individuals, as well as the free sale of shares in enterprises. Today, the public sector accounts for 56, collective enterprises - 36, and the private sector - 5% of industrial output. Recently, as noted by oriental scholars, China has seen the world's highest growth in industrial production.
American model is built on a system of all-round encouragement of entrepreneurial activity, enrichment of the most active part of the population, creation of an acceptable standard of living for low-income groups through partial benefits and allowances. There is a large difference in the level of wages among categories of workers. The task of social equality among the population is not set. Relatively small share of state property. So, today the share of state ownership in the share capital in the US is 10, in Germany - 18, in England - 24, in France - 34, in Italy - 38%.
This model is based on a high level of labor productivity and a mass orientation towards achieving personal success. The role of the state in the economy is minimal, but its influence is aimed at maintaining a stable environment and economic balance. The state determines the strategy for the development of education, social security for the poor and the unemployed, and regulates business. Of course, the market plays an important role in solving economic problems.
Japanese model presupposes a high degree of state regulation of the economy and active development of the private sector, a small amount of state entrepreneurship. The state stimulates the development of medium and small business, which accounts for 80.6% of all employed in the economy. Tough antitrust policy is being pursued. The state strongly interferes with the economy. Long-term and medium-term plans are being developed. At the same time, the plans are not of a directive nature, but are state programs of a recommendatory nature. The state is fighting against social inequality, although there are no obstacles to property stratification. The main criterion for the Japanese model is high rates of economic growth. At the same time, the standard of living of the population is relatively high. So, life expectancy for men is 75.5 years, and for women - 81.8. The level of wages lags behind the growth of labor productivity. Due to this difference, a decrease in the cost of production and a sharp increase in its competitiveness in the world market are achieved. Such a model is possible only with a high level of development of national self-awareness, the priority of the interests of the nation over the interests of a particular person, the readiness of the population to make certain material sacrifices for the sake of the country's prosperity.
Japan does not have its own raw materials and energy resources, but within a short period of time it has turned from a federal country into a powerful industrial power. The so-called "Japanese miracle" took place, in which Japan immediately after the war of 1947 carried out (land reform. The largest monopolies were eliminated. Land passed to small farmers, the efficiency of agricultural production increased, food prices decreased, competition appeared, increased return on foreign resources The main choice was made - to develop scientific and technological potential and knowledge-intensive industries, to produce high technology and to export products, all in the absence of own resources.
There are three postulates in the production management system in Japan:
1) lifetime employment of employees;
2) the establishment of wages and careers, depending on the period of work at the enterprise and age;
3) the creation of trade unions, not on a sectoral basis, but directly at firms.
This model yielded immediate positive results: Japan now produces 14% of the world's GNP and 12% of industrial output. The country has no external debt, inflation and unemployment rates are the lowest of any country in the world.
Swedish model is distinguished by a strong social policy, active participation of the state in ensuring economic stability in society. In the hands of the state is only 4% of fixed assets, but the share of government spending in the 90s. accounted for 70% of GDP, half of which is directed to social needs. At the same time, social justice, collectivism are ensured, there is almost no unemployment, there is no difference in the income of the population, and a high standard of living of the population. Up to 90% of production operates in private companies. However, the state intervenes in the economy for the sake of ensuring a high standard of living for the population (including employment, education, health care, transport, etc.). Naturally, all this is achieved by a high tax rate, but at the same time the rights of producers are not infringed upon. The increase in tax rates is associated with the efficiency of a particular production.
German model is close in its socio-economic content to the Japanese model. The main ideologist of the social market economy is Ludwig Erhard. Distinctive features of the German model are: strong government influence on the economy; free medicine and education; planning (targeting since the 70s) of the main macroeconomic indicators; full autonomy of the Central Bank, as in Japan; the difference in wages, as in the Japanese model, is insignificant.
French model has no striking features. She occupies a middle position between the American and German models. Indicative planning and state entrepreneurship play a leading role in the economy.
Traditional economy Is an economy in which the practice of using resources is determined by traditions and customs.
Countries with traditional economies are characterized by a multitude of structures, i.e. the existence of various forms of management based on various forms of ownership: the subsistence communal economy is based on the communal form of ownership, the small-scale production of peasants and artisans is based on small private property. This means, firstly, structures differ in the forms of ownership.
The ways of life also differ how economic decisions are made. Within the framework of the natural-communal structure, decisions are made by the council of elders or the head of the clan. Peasants and artisans make such decisions independently. In countries with traditional economies, the state plays an important role in making economic decisions.
Another group of differences between lifestyles is associated with incentives to housekeeping.
In the natural-communal structure, the incentive to work is the need to satisfy elementary life needs. Small-scale production of peasants and artisans is focused not only on meeting needs, but also on making a profit.
The traditional economy is based on primitive technology, since the use of new information is constrained by the traditions that have developed in society.
3.2.2. Planned Economy
Planned Economy Is an economy in which material resources are mainly state property, and the direction and coordination of economic activities are carried out through central planning, management and control.
In a planned economy, the main economic decisions are made centrally in the form of plans for socio-economic development. Through the implementation of plans, a balance of economic activity is achieved.
There are two types of planned economy: democratic planned economy and command planned economy.
Democratic planned economy presupposes both public and private ownership of economic resources, but public ownership remains the dominant form. The planning is general, not detailed. The implementation of plans is mandatory only for state enterprises. For the rest of the economy, the plans are advisory in nature.
Command planned economy represents a more rigid model typical for the former USSR, as well as for a number of countries in Eastern Europe and Asia. It is based on state ownership of economic resources. Private property is almost completely excluded. Planning covers all areas of economic activity, and the implementation of the plan is mandatory for everyone.
In a command economy, all enterprises are managed from a single center. Therefore, direct producers are limited in making economic decisions. They do not have the opportunity to independently choose suppliers of raw materials, equipment, and also sell products. In turn, consumers are limited in the choice of offered products. The result is a lack of competition, a slowdown in the growth of product quality, labor productivity and the introduction of innovations. The dominance of administrative methods in the former socialist countries led to a permanent shortage of goods and services, which allowed the Hungarian economist J. Kornai to call such an economy "the economy of scarcity."
3.2.3. Market economy
Market economy Is an economy based on commodity-money relations, domination of private property and free competition between producers and consumers.
Currently, the market economy is one of the main types of economic systems. The main economic decisions are made independently by producers and consumers. The former, at their own peril and risk, make decisions about what products to produce, in what quantities, by means of what technique and for whom.
The latter make their own choice about which products to purchase and from which manufacturers. The choice is made under the influence of factors such as price, quality, etc.
The balance of the economy is achieved through a market mechanism. Its main elements are supply and demand. Taking into account their compliance, the price of goods is formed. The price level is a signal to increase or decrease their production.
The market economy was formed in the 18th century. and is the most flexible economic system, which, under the influence of internal and external factors, tends to transform and change. The initial form of a market economy is classical capitalism.
This type of market economy existed in the developed countries from the 17th to the first decades of the 20th century. Classical capitalism is characterized by the following features:
- 1) the presence of private ownership of economic resources;
- 2) free competition, which ensures unhindered entry into the market and the flow of capital from one sector of the economy to another;
- 3) the presence of many independent manufacturers who decide for themselves: what for who and as produce;
- 4) the presence of many independent consumers who make an independent decision about which products and from which producers to buy;
- 5) personal freedom of all market participants, which allows the entrepreneur to determine the scope of the business, and the employee to move freely in the labor market;
- 6) the spontaneous nature of setting prices under the influence of supply and demand;
- 7) the orientation of entrepreneurs to maximize profits, forcing them to save resources, take a thrifty attitude to living and materialized labor.
Classical capitalism developed spontaneously and did not provide for state regulation of the economy.
However, at the beginning of the XX century. its economic mechanism no longer corresponded to new needs. Therefore, in most developed countries, it gradually transformed into a mixed economy.
3.2.4. Socially-oriented mixed economy
It was indicated above that a socially-oriented mixed economy is the object of study of economic theory. Therefore, its analysis deserves special attention. A socially-oriented mixed economy contains two principles: "sociality" and "mixed". They did not form (let alone merge into a single system) at once and in some way represent a conglomeration of the achievements of both the socialist and capitalist economic systems.
Let's consider each of these principles separately.
Let us first turn to "confusion".
Mixed economy Is an economy operating on the basis of a market mechanism and state regulation of the economy. Such changes in the role of the state are caused primarily by the need to develop industrial and social infrastructure, scientific and technological progress.
There is no consensus among economists in defining the concept of "mixed economy". Views are not the same on what is confusing in this economy. Thus, Claes Eklund, in his famous book "Effective Economy. The Swedish Model", writes that a mixed economy is one that "has the features of both a planned and a market economy." There are two principles here: "plan" and "market". S. Fischer, R. Dornbusch, R. Schmalenzi note: "All modern economies are mixed - they are in the interval between two extremes: purely command and purely market systems ... The dispute arises precisely about the role that the state and the market should play. in economics".
This definition is most typical. It contrasts two elements - "market" and "state". O. Yu. Mamedov is an opponent of this point of view. In his opinion, “market” and “state” are logically non-opposed elements: “market” can be opposed only by “non-market”, i.e. "market" organization of production - "non-market", and "state" (public) - "non-state" (private).
It would be unfair to take any one of the above definitions of a mixed economy as indisputable and to belittle others. Each of them sets off one of its many sides and focuses on it. The full picture emerges when considering the totality of its aspects: in the study of the "market" and "non-market" sectors of the economy, in clarifying the relationship between the "invisible hand of the market" and the "regulating hand of the state", in the study of the possibility of using the "plan" and "market". So, at the micro level, in-house planning. In macroeconomics, state regulation.
In the planning process at the micro level, a large role is given to marketing research, which allows you to fully and accurately identify needs and determine the demand for the company's products.
State regulation of the economy makes it possible to adjust supply and demand at the macro level.
In contrast to classical capitalism, a mixed economy is characterized by the domination of collective private property in the form of joint-stock and other companies.
Now let's consider the essence of "sociality".
The methodological foundations of the theory of "social market economy" were laid back in the 1930s – 1940s. sponsored theory of order. They are V. Oyken, F. Boehm, V. Repke, A. Ryustov, L. Miksh, A. Müller-Armak. The most famous professor at the University of Freiburg, the founder of the Freiburg school V. Eiken. He introduced the concept of "economic order" into scientific circulation and defined two of its ideal types: "centrally controlled economy" and "market" (exchange). According to Oiken, they never exist in their pure form, but only in the form of a certain "mixture" with the predominance of one of them. The amount of this "mixture" is significant. If the market type dominates, then fluctuations in the market situation are manifested in fluctuations in employment. If the centralized-administrative type dominates, then the change in the economic situation manifests itself in fluctuations in consumption. This is expressed in the fact that the governing bodies can invest in the construction of factories and plants, rather than housing, food and other consumer goods, which means a forced reduction in consumption. According to Eiken, a market (exchange) economy is preferable to a centralized one, since the latter cannot find out the needs of members of society. Therefore, government intervention in the economy should not be excessive. However, the economic order cannot be established by itself; its creation requires state intervention.
The theory of order was the forerunner of the concept of "social market economy", one of the main authors of which was L. Erhard. According to Erhard, modern liberalism cannot but admit a noticeable role of the state in economic processes. Erhard used this concept for the post-war economic renewal of Germany, when the old totalitarian regime "centrally controlled economy" collapsed in the country, and the "exchange (market) economy" had already generated anarchy and a "black market".
The term "social" means that the economy is focused on solving both economic and social problems.
The effective functioning of any model of the economic system is achieved through the creation of a favorable institutional environment, which is represented by a set of rules, institutions, organizations.
Thus, a social market economy is impossible without observing the economic and social order.
The economic order includes:
- the procedure governing property rights;
- monetary and currency order;
- competitive order;
- the procedure regulating foreign economic activity.
In this way, economic order- These are the rules governing the organizational structure of the economy, as well as a set of institutions responsible for giving the economy a certain organizational form.
Social orderIs a set of institutions and norms that determine the social status of citizens and individual groups of the population.
The social order covers:
- order in the world of work;
- order in the system of social insurance and social assistance;
- property order;
- housing order;
- ecological order, etc.
A socially-oriented mixed economy is characterized by various models due to national specifics, some of which will be discussed below.
American model
The size of state property is small. The main positions in the economy are occupied by private capital, the development of which is regulated by institutional structures, legal norms and the tax system. However, government intervention is large enough. It is carried out by the following methods:
- system of government orders. It involves private business (large, medium and small) in the implementation of state programs and thus forms a vast state market. The bulk of budget funds is redistributed through this system;
- provision of industrial and social infrastructure, scientific and information base, the creation of which is beyond the power or unprofitable for private capital;
- the main impact on the economy is carried out by the state through indirect levers - the state budget, the monetary system, economic and legal legislation.
The social security system in the United States includes social security (pensions, benefits, medical services for people covered by insurance, unemployment insurance benefits) and assistance, i.e. helping the poor. These payments come from the state budget. But public resources seem to supplement the spending on social services of the private sector, which is the main source of social financing.
British model
The UK's mixed economy was shaped by the active role of government regulation. After World War II, a number of industries were partially nationalized in Great Britain, and a unified system of public health care and social security was created. As a result, an extensive public sector and an extensive system of state regulation were created, which was expressed:
- in providing the private sector with government orders;
- in the development of the military-industrial complex (MIC);
- in financing research and development work (R&D);
- in financing the social sphere, etc.
But by 1980 in Great Britain there was a decrease in the efficiency of the economy and a weakening of its position in the world system. All this required limiting state intervention in the economy and providing more freedom to market forces: in the 1980s and 1990s. Most of the state-owned enterprises were privatized, including natural monopolies - telephone communications, gas and electricity supply, water supply, etc. At the same time, there was a process of encouraging private entrepreneurship. A deregulation policy was also pursued: the control over prices, wages, and dividends was eliminated. The targeted nature of free medical care has increased. All this made it possible to increase the efficiency and competitiveness of the British economy.
German model
A characteristic feature of the German model of a mixed economy is its social orientation, the separation of social policy from economic policy. The source for social protection of the population is not the profits of enterprises, but special budgetary and extra-budgetary funds.
French model
The system of state regulation in France is one of the most developed in Western Europe. France is the only country in Europe that has managed to implement the concept of economic development on the basis of state plans-programs that largely determined the success of reconstruction and economic growth in the post-war period. France, later than other European countries, embarked on the path of liberal reforms, but large-scale privatization did not eliminate, but only complicated the forms of state regulation. Attempts to strengthen the free market did not lead to the government leaving the economy.
Italian model
The mixed economy in Italy is a kind of variant of the Western European model, which is characterized by:
- the vast public sector;
- highly developed large private business;
- lifestyles left over from early capitalism;
- large share of small business;
- developing cooperative sector.
The public sector is in key positions.
The most numerous category of state-owned enterprises is joint stock companies with mixed capital. Liberal reforms have not brought about radical changes in the state sector. The Italian model of a mixed economy is characterized by a developed social infrastructure and a high degree of social protection.
Scandinavian model (Sweden, Norway, Denmark, Finland)
A feature of this model is the leading role of the private sector. The low share of state ownership is combined with a significant role (especially in Sweden) of the public sector. The co-operative sector plays a significant role (especially in Denmark) in agriculture, industry, trade, housing construction, banking and insurance.
The Scandinavian countries are characterized by a high degree of socialization of the economy, manifested in the redistribution through the tax system of a significant part of the gross domestic product (GDP), which allows for an active social policy.
Japanese model
The peculiarity of the mixed economy in Japan is the optimal combination of trends in the world approach with national specifics. Japan is characterized by a relatively low share of large state-owned and mixed state-private enterprises. An important source of flexibility in the Japanese economy is the broad development of medium and small businesses. Japan is characterized by a higher degree of state control over the economy compared to other industrialized countries. A feature of the Japanese model of a mixed economy is its focus on saving, production and export with the auxiliary role of personal consumption. Having played a positive role in the country's economic success, such institutions as the priority of the producer over other human rights, the system of life-long employment, "seniority salary", collective responsibility and initiative do not meet the needs of the development of modern society. The time has come to change the models of economic development.
3.2.5. Transition economy
Transition economy Is an economy in the process of transition (transformation) from one economic system to another.
The transition from one economic system to another takes a long period of time (from decades to centuries). Currently, the post-socialist countries are undergoing a transition from a command-planned to a market economy. The economy in transition is not a product of the 20th century. The economy of the leading countries at the end of the 17th - first half of the 19th century. also marked the transition from a traditional to a market economy and was in transition.
A characteristic feature of an economy in transition is the simultaneous existence of economic relations between the old system and the new ones inherent in the emerging system.
The economy of a transitional type is characterized by a multitude of structures.
The economy in transition is characterized by aggravation of socio-economic relations, which decreases as a new economic system is created.
The duration of the market transformation depends on the level of socio-economic development of society.
Economic systems develop within a certain form of ownership.
And the links between business entities, formed on the basis of the prevailing and methods of regulating macroeconomic activities. Households, firms and the state can act as economic entities.
Over the past two hundred years, four global economic models have predominantly operated in the world. These are two systems with a dominant market economy - pure capitalism and modern capitalism, and two systems of a non-market type - administrative-command and traditional. And already within the framework of one or another general economic model, various models of economic development of individual regions and countries are distinguished. Below are general descriptions of global economies.
Traditional system
This type of economy prevails in underdeveloped countries and implies a low level of technology development, widespread manual labor and a multi-structure economy, which manifests itself in the coexistence of various economic forms. Naturally communal forms of production and distribution of products are often preserved. In the economy, a significant role is assigned to small-scale commodity production, represented by numerous craft and peasant farms.
In a traditional system, foreign capital plays a decisive role. At the same time, the social structure of society depends entirely on the centuries-old foundations and traditions, caste, class - which significantly hinders socio-economic development.
Administrative command system
Economic models of the administrative-command type were adopted in all countries of the socialist camp (primarily in the USSR) and in some Asian countries.
The distinctive features of this type of management can be called the following:
- ownership of economic resources - state,
- bureaucratization and state monopolization of the economy,
- the basis of economic activity is centralized planning of the economy;
- needs, demand and supply were determined by centralized planning departments, without the participation of direct consumers and producers, based on a common political ideology.
Pure capitalism
This model operated in the 18th and 19th centuries and presented itself with pure competition. Economic activity was carried out by sole entrepreneurs-capitalists and, accordingly, they also owned the right of ownership. Self-regulation of private capital took place on the basis of free markets, and the state minimally interfered in this process. Hired workers had virtually no social protection in the event of unemployment, old age, and illness.
Modern capitalism
By the middle of the 20th century, with the advent of the scientific and technological revolution, the rapid development of social, technical and industrial infrastructures, state structures begin to participate much more actively in the development of the national economy. Pure capitalism is gradually transforming into a system of advanced modern capitalism. Within the framework of this system, national economic models arose, which received their specific features based on the characteristics of social, national, geographical and historical conditions. Let's take a look at some of them.
American model
- active encouragement of small business (about 80% of all new jobs are created by representatives of small business);
- the state intervenes minimally in the regulation of the economy;
- it is represented very insignificantly in the total volume of forms of ownership;
- pronounced stratification of society into classes of rich and poor;
- a satisfactory standard of living and social protection of poor citizens.
Japanese economic model
- active influence of the state on the development of the economy with the obligatory planning of this development (five-year plans are drawn up for certain areas of the economy);
- the wages of ordinary employees and managers of firms differ very slightly, therefore the level of income of the population is fairly uniform;
- the economy has a pronounced social orientation (the practice of life-long employment, social partnership, etc.).
South Korean model
- state planning, development of five-year plans;
- strict regulation of foreign economic activity in order to develop exports and minimize imports;
- state control in the banking sector.
Chinese model
- the coexistence of the market and;
- maintaining free economic zones;
- equal level of income of the population;
- great importance of households;
- chinese immigrants are actively helping the development of the national economy.
MINISTRY OF EDUCATION AND SCIENCE OF UKRAINE
NATIONAL TECHNICAL UNIVERSITY "KHARKOV POLYTECHNICAL INSTITUTE"
Department of General Economic Theory
Political Economy
Course work
on the topic: Economic systems, their classification and national models.
Completed:
group student
grade book number
Checked
INTRODUCTION
1. Theoretical foundations of the economic system
1.1. Economic system concept
1.2. Types and models of economic systems
2. Three main types of economic systems
2.1. Administrative and command economic system
2.2. Market economic system
2.3. Mixed economic system
3. The economic system of Ukraine
3.1. The concept of a transitional economic system and its types
3.2. Features, problems and prospects of the Ukrainian economic model
CONCLUSION
LIST OF INFORMATION SOURCES
Appendix A. Summary table of inflation indices
Appendix B. The size of the subsistence minimum
The economic system is a set of interrelated and in a certain way ordered elements of the economy.
Outside the systemic nature of the economy, economic relations and institutions could not be reproduced and constantly renewed, economic regularities could not exist, there could not be a theoretical understanding of economic phenomena and processes, there could be no coordinated and effective economic policy.
Real practice constantly confirms the systemic nature of the economy. Objectively existing economic systems find their scientific reflection in theoretical economic systems. The first detailed analysis of the economy as a system was given by the founder of the classical school of political economy A. Smith in his main scientific work "Research on the nature and causes of the wealth of peoples" (in the accepted abbreviation - "The Wealth of Nations"), published in 1776. economic systems should, first of all, highlight the systems created by D. Ricardo (1817), F. List (1841), J.S. Mill (1848), K. Marx (1867), K. Menger (1871), A. Marshall (1890), J. Keynes (1936), P. Samuelson (1951).
Among the Russian economists of the past who focused on a systemic view of the economy, I.T. Pososhkova, A.I. Butovsky, N.G. Chernyshevsky, M.I. Tugan-Baranovsky, A.I. Chuprova, P.B. Struve, V.I. Lenin, N. D. Kondratyev. In the Soviet period of domestic economic science, the most notable were the theoretical systems, which were reflected in the textbooks of political economy edited by K.V. Ostrovityanova, A.M. Rumyantseva, N.A. Tsagolova, N.P. Fedorenko, V.A. Medvedeva, L.I. Abalkina and others.
As the history of economic science shows, the classification of economic systems can be made on the basis of various features. This classification is based on the objective variety of properties of economic systems. In an enlarged form, the criteria of economic systems can be divided into three groups:
Structural criteria;
Socio-economic (substantive) criteria;
Volumetric and dynamic criteria.
Such theorization is necessary in the conditions of the Ukrainian economy, since at this stage of its development it is already possible to summarize some results, draw conclusions, and, most importantly, determine further ways of its development.
So, the purpose of this course work is to define the concept of an economic system, its classification and national models.
When writing a term paper, the following main tasks are set:
definition of the concept of an economic system, its types and models;
consideration of the characteristics of the market economic system;
characteristics of the administrative-command economic system
mixed system analysis;
consideration of the economic system of Ukraine, its features, problems and development prospects.
1.1 Concept of an economic system
To define the concept of an economic system, it is necessary to define the category "system" as a whole. A system is an organically whole entity, consisting of a number of its constituent parts, regularly and firmly connected with each other by cause-and-effect relationships and interdependencies.
Two systems interact in the surrounding world: nature and society. Man is a part of nature, constituting a social system that has arisen and functions on the basis of a natural system and does not exist in isolation from it, for the very deep essence of man is dual.
Human society as a system is an interacting totality of individuals, their various groups and associations as social phenomena.
The economic system is the link between the natural and social systems. Moreover, it is, in its various aspects, a part of both nature and society. In the sphere of economics, resources, scientific, technical, organizational achievements formed by the social system function. The social system forms the needs, qualitative and quantitative characteristics of the products produced.
The totality of all economic processes taking place in a society on the basis of property relations and organizational forms operating in it, is the economic system of this society. Having understood the essence of the system, one can understand many laws of the economic life of society. The economic system of society is a systemic organization of nature and society, in which every phenomenon in nature and society is associated with other phenomena and interacts with them. Rather close ties and strong stable interaction between a certain range of phenomena lead to the formation of corresponding systems with their characteristic features.
An economic system is a set of social institutions, the existence, functioning and interaction of which determines the nature of production, exchange, distribution and consumption of an economic product.
The economic system is understood as the real, national economy, that is, the economy of a separate country with its intra-industry structure, firms, enterprises, and households. All production and economic units, all branches of the national economy are firmly and steadily interconnected by the processes of division of labor and exchange.
The following main components of the economic system can be named:
1) the productive forces of society, represented by personal, material, social factors;
2) technical and economic relations;
3) socio-economic relations;
4) the economic mechanism.
Productive forces and technical and economic relations form the technological mode of production. And the technological mode of production, together with socio-economic relations, forms a social or social mode of production.
The economic mechanism is a combination of technical and economic, socio-economic, legal relations in the field of economy and civil law and economic policy.
In view of all modern world trends, we can say that the concept of "economic system" now covers almost all spheres of human and society life, ensures their existence and livelihoods, and determines their development.
1.2. Types and models of economic systems
In recent centuries, various types of economic systems have operated in the world: two market systems dominated by a market economy - a market economy of free competition (pure capitalism) and a modern market economy (modern capitalism) and two non-market systems - traditional and administrative-command.
Within the framework of this or that economic system, there are various models of economic development of individual countries and regions.
Compared to all previous ones, the market system turned out to be the most flexible: it is capable of restructuring, adapting to changing internal and external conditions.
In a developed market economy, the economic mechanism undergoes significant changes. Planned management methods are further developed within individual firms in the form of a marketing management system. At the same time, at the macrolevel, the development of planning methods is associated with state regulation of the economy.
Planning acts as a means of actively adapting to market requirements. As a result, the key tasks of economic development receive a new solution. State sectoral and national programs (plans) have a significant impact on the volume and structure of goods and services produced, ensuring their greater compliance with changing social needs.
The problem of using resources is solved within the framework of an economic entity on the basis of strategic planning, taking into account the most promising industries. At the same time, the redistribution of resources for the development of the newest industries occurs at the expense of budgetary allocations, state national and interstate programs, R&D in priority areas. For example, the pan-European programs "Eureka", "Esprit" and others are currently being implemented.
Finally, the problem of distribution of the created gross national product is solved on the basis of traditionally established forms and is supplemented by the allocation of ever greater resources by both large companies and the state for investments in the development of the "human factor": financing of education systems, including retraining of workers of various qualifications, improvement of medical services to the population, social needs.
At present, at least 30-40% of all state budgetary allocations in developed countries with market economies are allocated to social security, the implementation of numerous programs "to combat poverty".
In economically underdeveloped countries, there is a traditional economic system. This type of economic system is based on backward technology, widespread manual labor, and a diversified economy.
The diversity of the economy means the existence of various forms of management in a given economic system. In a number of countries, natural communal forms based on communal collective farming and natural forms of distribution of the created product are preserved. Small-scale production is of great importance. It is based on private ownership of productive resources and the personal labor of their owner. In countries with a traditional system, small-scale commodity production is represented by numerous peasant and craft holdings that dominate the economy. In conditions of relatively poorly developed national entrepreneurship, foreign capital often plays a huge role in the economies of the countries under consideration. The life of society is dominated by centuries-old traditions and customs, religious and cultural values, caste and class division, restraining socio-economic progress.
The solution of key economic problems has specific features within various structures. The traditional system is characterized by such a feature - the active role of the state. Redistributing a significant part of the national income through the budget, the state directs funds to develop infrastructure and provide social support to the poorest segments of the population.
The administrative-command system (centralized, planned, communist) prevailed earlier in the USSR, the countries of Eastern Europe, in a number of Asian states and other countries of the world. The characteristic features of the administrative-command system are public (and in reality state) ownership of practically all economic resources, monopolization and bureaucratization of the economy in specific forms, centralized economic planning as the basis of the economic mechanism.
In countries with an administrative command system, the solution of general economic problems had its own specific features. In accordance with the prevailing ideological guidelines, the task of determining the volume and structure of products was considered too serious and responsible to be passed on to the direct producers themselves - industrial enterprises, collective and state farms.
The distribution of the created products between the participants in production was strictly regulated by the central authorities through the universally applied tariff system, as well as centrally approved standards of funds for the payroll. This led to the predominance of an equalizing approach to wages. A distinctive feature of the distribution of products in the administrative-command system was the privileged position of the party-state elite.
The lack of viability of this system, its insensitivity to the achievements of scientific and technological revolution and the inability to ensure the transition to an intensive type of economic development made radical socio-economic transformations inevitable in all former socialist countries. The strategy of economic reforms in these countries is determined by the laws of the development of world civilization.
In addition to the existing extensive systems, each of them has its own national models of economic organization, since countries differ in history, level of economic development, social and national conditions. So, in the administrative-command system, there was the Soviet model, the Chinese, etc. In the modern capitalist system, there are also various models.
The American model is based on a system of all-round encouragement of entrepreneurial activity, enrichment of the most active part of the population. Low-income groups are provided with an acceptable standard of living through partial benefits and allowances. The problem of social equality is not posed here at all. This model is based on a high level of labor productivity and a mass orientation towards achieving personal success.
The Japanese model is characterized by a certain lag in the standard of living of the population (including the level of wages) from the growth in labor productivity. Due to this, a decrease in the cost of production and a sharp increase in its competitiveness in the world market is achieved. There are no obstacles to property stratification. Such a model is possible only with an exceptionally high development of national self-awareness, the priority of the interests of the nation over the interests of a particular person, and the readiness of the population to make certain material sacrifices for the sake of the country's prosperity.
The Swedish model is distinguished by a strong social policy aimed at reducing wealth inequality by redistributing national income in favor of the poorest segments of the population. Here in the hands of the state is only 4% of fixed assets, but the share of government spending was in the 80s. at the level of 70% of GDP, with more than half of this spending being directed to social purposes. Naturally, this is only possible under conditions of a high tax rate. This model is called "functional socialization", in which the function of production 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) - on state.
In the last one and a half to two centuries, various types of economic systems have operated in the world: two market systems dominated by a market economy - a market economy and a mixed economy and two non-market systems - a traditional and an administrative-command one. Within the framework of a particular economic system, there are diverse models of economic development of individual countries and regions.
2.1. Administrative and command economic system
The command system of the economy is a way of organizing economic life in which capital and land are owned by the state, and the distribution of limited resources is carried out according to the instructions of the central government and in accordance with plans.
The birth of the command system was the result of a series of socialist revolutions, the ideological banner of which was Marxism. The concrete model of the command system was developed by V. I. Lenin and I. V. Stalin.
In accordance with the Marxist theory, a sharp increase in the welfare of the country was envisaged and the elimination of differences in the individual welfare of citizens through the elimination of private property, as well as the conduct of all economic activities on the basis of a single obligatory (directive) plan, which is developed by the state leadership on a scientific basis.
The command system involves the complete elimination of private property and its replacement by state property. The main economic issues are resolved by government authorities and are implemented through binding orders and plans. For this, the state is forced to regulate all aspects of the economic life of society, including the setting of prices and wages.
The economic activities of manufacturing enterprises in the USSR command system were regulated by:
The State Planning Committee (answering the question of what to produce and in what volumes);
The branch ministry (answering the question of how to produce), which dictated the production technology and allocated funds for the purchase of equipment;
The State Committee for Procurement (which answered the question of who to sell and from whom to buy resources);
State Pricing Committee (answering the question, at what price to sell);
The State Committee on Labor and Wages (which answered the question of how much to pay workers), etc.
In accordance with this system, all the resources declared to be the property of the whole people are in fact completely controlled by the state and party officials. As a result, the incomes of people and enterprises cease to depend on how rationally they use resources, how much society really needs the products of their labor. Performance evaluation is carried out according to formal criteria, which often do not coincide with the real needs of society. In combination with an equalizing system of remuneration and an increase in the level of corruption among officials, this leads to a loss of people's interest in work.
The administrative-command economy is an economy in which the state form of ownership dominates and the main, as well as less significant, economic decisions are made at the highest level of management and administratively, in the form of commands that are mandatory for execution, are communicated to each economic unit. Methods and mechanisms of commodity production and market economy are not applied or are applied in a limited and sometimes distorted form. The centralized bureaucratic management system mainly uses non-market levers to carry out directive tasks and decisions.
The economic independence of enterprises and organizations in the command economy is largely limited. There are planned targets that define in detail the natural and cost indicators brought to each enterprise in the form of a detailed list. The distribution of material and technical means (machinery, equipment, raw materials and materials) and the sale of finished products are also strictly regulated.
Pricing is carried out exclusively by administrative means. All goods are sold and bought at prices set by special government agencies.
The management of enterprises and organizations violating administrative recommendations and state planning targets is punished by law enforcement and higher departmental bodies.
The administrative-command economy was formed in the USSR in the early 1930s, it also operated in the countries of Central and Eastern Europe, China, Vietnam, etc. As a result of the application of unified inflexible administrative forms and methods of management, which were equally used for all industries and regions countries, for all types of enterprises and organizations, decreased labor productivity, increased costs of material and financial resources. In general, the administrative-command economy is an ineffective economy, difficult to reform and is characterized by a constant shortage of production resources and goods for the consumption of the population.
The ineffectiveness of the command system in the USSR and other countries of the former socialist camp became evident by the early 1980s. Compared to developed countries, the overwhelming majority of products produced in these countries turned out to be uncompetitive due to low quality and outdated production technology; the level of well-being and life expectancy of citizens is lower, and infant mortality is higher; the technical level of production is also much lower, and environmental pollution is much higher.
The market system is a way of organizing economic life in which capital and land are privately owned, and the allocation of resources, production, exchange and consumption of goods and services are carried out on the basis of supply and demand. The market economy is based on the principles of free enterprise and choice.
The basis of this system are: the right to private property, private economic initiative, market organization of resource allocation.
The creation of exactly those goods that society needs is carried out by a system of markets, on each of which goods and resources of a certain type are sold and bought (there is a land market, a capital market, a labor market, markets for goods and services that are directly consumed by people).
The market determines the degree of success of a particular economic initiative, forms the amount of income that property brings to its owners, dictates the proportions of distribution of limited resources between alternative spheres of their use.
The well-being of each person in the market system is determined by how successfully he can sell on the market the goods he owns: his labor force, skills, his own products, land plot, the ability to conduct commercial transactions. Anyone who offers customers the best product and on more favorable terms opens the way for the growth of his own well-being.
The action of the market mechanism is shown in Figure 1.
Figure: 1. Market mechanism.
The advantage of the market mechanism is that it forces each seller to think about the interests of buyers, thereby the seller achieves his own benefit. But the buyer is forced to reckon with the interests of the seller - he can get the desired product only by paying the current market price for it. Analyzing the mechanism of market reconciliation of the interests of sellers and buyers, the eminent English scientist-economist Adam Smith wrote in his famous book A Study on the Nature and Causes of the Wealth of Nations (1776): “Each person thinks only about his own benefit, but an invisible hand that guides him , as well as in many other things, will lead him to the result, which he himself did not even think about ”.
By the “invisible hand” of the market, which has allowed the market economic system to coordinate the activities of hundreds of millions of people since Adam Smith, economists mean the price mechanism. It is the prices that develop in the process of competition in the market that serve as the main source of information for all sellers and buyers about the ratio of the supply of goods and the demand for them.
Competitive markets are the most efficient way known to mankind to allocate limited productive resources and the benefits created with their help.
The advantage of competition lies in the fact that only through the production of goods of better quality or less costly goods, it is possible to defeat competitors. In the competition of buyers for scarce goods with the lowest costs, those whose own activities are valued by the market especially highly and are better paid, which allows them to offer the highest price for the goods, prevail.
The market system, due to the peculiarities of its functioning, also has a number of shortcomings, which are called market failures (weaknesses) in economic theory.
The main drawbacks of the market system are: a significant gap between the incomes of various segments of the population, the inability to produce a sufficient amount of so-called public goods within the system, possible monopolization of the market, etc.
In such a system, the behavior of each of its participants is motivated by his personal interests: the economic subject seeks to maximize his income based on individual decision-making.
The market system functions as a mechanism through which individual decisions and preferences are publicized and coordinated. The fact that goods and services are produced and resources are offered in a competitive environment means that there are many independent buyers and sellers of each product and resource. As a result, economic power is widely dispersed. The decisive condition for economic progress was the freedom of entrepreneurial activity of those who had capital. A new level of development of the "human factor", the main productive force of society, was reached. The hired worker and the capitalist entrepreneur acted as legally equal agents of market relations. The concept of "free hired worker" implies the right to freely choose the buyer of labor, the place of its sale, ie. freedom of movement within the labor market. Like any commodity owner who sold his goods and received money for it, the hired worker had the freedom to choose objects and ways to satisfy needs. The flip side of freedom of choice was personal responsibility for maintaining the workforce in a normal state, for the correctness of the decision made, for compliance with the terms of the labor agreement.
What is the mechanism for solving fundamental problems of economic development in the economic system under consideration? They are resolved indirectly, through prices and the market. Price fluctuations, their higher or lower level serve as an indicator of social needs. Focusing on the market conditions, the level and dynamics of prices, the commodity producer independently solves the problem of the distribution of all types of resources, producing those goods that are in demand in the market.
Defenders of pure capitalism argue that such an economic system favors efficient use of resources, stability of production and employment, and rapid economic growth. That is why there is very little or no need for government planning, government control and interference in the economic process.
Is the market system the best way to find answers to the fundamental questions posed above? This is also a difficult question: any complete answer to it inevitably transcends facts and enters the realm of value judgments. But it follows that there is no scientific answer to such a question. The very fact that there are many alternative ways of allocating scarce resources, that is, many different economic systems, is a clear indication of the divergence in assessments of the effectiveness of the market system.
2.3. Mixed economic system
The political and economic concept of the social-market economy is aimed at synthesizing freedom guaranteed by the rule of law, economic freedom (which, due to the indivisibility of freedom, is considered as a necessary component of free order in general) and the ideals of the social state associated with social security and social justice. This combination of goals - freedom and justice - is reflected in the concept of "social market economy".
The market economy represents economic freedom. It consists in the freedom of consumers to buy products of their choice (freedom of consumption), freedom of production and trade, and freedom of competition.
The expansion of the functions of the state in modern society while maintaining market freedoms, institutions and mechanisms is to a decisive extent due to the increased complexity of the socio-economic process. Many fundamental problems of today's society cannot be effectively solved with the help of market mechanisms alone. This is, first of all, the strengthening of the social sphere, which has become one of the most important sources of economic growth. Thus, the level of education, qualifications of the labor force and the state of scientific research directly affect the rate and quality of economic growth, which is confirmed by econometric calculations. Health care, social security and the state of the environment have a huge impact on the quality of the workforce and on economic development in general. The market by itself cannot create a powerful social sphere, although a strong social orientation may be inherent in market mechanisms, especially competition. Economic mechanisms in a mixed economic system are shown in Figure 2.
Figure: 2. Market mechanism in a mixed economy
Therefore, a socially oriented market economy aims to achieve both economic and non-economic goals using a wide range of economic and social policy instruments.
In general, these goals can be formulated as follows:
ensuring economic growth and economic stability;
social security and social justice;
promoting competition;
ensuring political stability.
In a mixed economy, the economic mechanism undergoes significant changes. Planned management methods are further developed within individual firms in the form of a marketing management system. At the same time, at the macrolevel, the development of planning methods is associated with state regulation of the economy.
Planning acts as a means of actively adapting to market requirements. As a result, the key tasks of economic development receive a new solution.
With regard to modern conditions, a mixed economy appears in the following enlarged forms:
Mixed economy of developing (especially underdeveloped) countries, in which "mixing" is caused by a low level of development and the presence of backward economic forms;
Mixed economy of developed countries (developed mixed economy).
The term "mixed economy" itself does not have an unambiguous interpretation. Its initial and most widespread interpretation focuses on the combination of various sectors of the economy (private and public), on a variety of forms of ownership. The second position, which received an impulse from Keynesianism, highlights the problem of combining the market, the market mechanism and government regulation. The third position, initiated by various social reformist movements, is based on a combination of private enterprise capital and sociality, public social guarantees. Finally, one more position, arising from the civilizational approach, aims at the problem of the relationship between economic and non-economic principles in the structure of modern society.
These interpretations of the mixed economy in modern conditions do not contradict each other: they only reflect the presence of several lines of shaping of the modern type of developed economy and their unity.
A mixed economy is a simultaneous combination of these parameters, namely: a combination of private and public sectors of the economy, market and government regulation, capitalist trends and socialization of life, economic and non-economic principles.
The parameters of a mixed economy are relatively independent. However, it is possible for one or another parameter or one of the groups of parameters to prevail in the conditions of different countries.
The mix of the economy is characterized not only by the presence of various structural elements in its composition, but also by the formation of specific forms of their combination in the real economy. An example of this is public-private joint-stock enterprises, contractual agreements between state bodies and private firms, social partnership, etc.
Today, a mixed economy is an integral system that serves as an adequate form of a modern developed society. Its constituent elements rely on such a level of productive forces and on such trends of socio-economic development that objectively require supplementing the market with state regulation, private economic initiative - with social guarantees, as well as the inclusion of post-industrial principles in the economic structure of society. A mixed economy is not a conglomerate, although it is inferior to "pure" systems in the degree of homogeneity of its constituent elements.
Different countries and regions are developing different models of a mixed economy. They differ from each other by their "national mixing coefficients" of different forms of ownership, market and government regulation, capital and sociality, economic and post-economic aspects. This feature depends on many factors: the level and nature of the material and technical base, historical and geopolitical conditions for the formation of a social order, national and socio-cultural characteristics of the country, the influence of certain socio-political forces, etc. Moreover, in a mixed economy, as a rule, one or another side of the parameters can dominate.
The American model is a liberal model that presupposes the priority role of private property, market competitive mechanism, capitalist motivations, and a high level of social differentiation.
The German model is a model of a social market economy, which links the expansion of competitive principles with the creation of a special social infrastructure that mitigates the shortcomings of the market and capital, with the formation of a multilayered institutional structure of social policy actors. In the German economic model, the state does not set economic goals - this lies in the plane of individual market solutions, it creates reliable legal and social framework conditions for the implementation of an economic initiative. Such framework conditions are embodied in civil society and social equality of individuals (equality of rights, starting opportunities and legal protection). They actually consist of two main parts: civil and commercial law, on the one hand, and a system of measures to maintain a competitive environment, on the other. The most important task of the state is to ensure a balance between market efficiency and social justice. The interpretation of the state as a source and protector of legal norms governing economic activity and competitive conditions does not go beyond the Western economic tradition. But the understanding of the state in the German model and, in general, in the concept of the social market economy differs from the understanding of the state in other market models by the idea of \u200b\u200bmore active state intervention in the economy.
The German model, which combines the market with a high degree of government intervention, is characterized by the following features:
individual freedom as a condition for the functioning of market mechanisms and decentralized decision-making. In turn, this condition is ensured by an active state policy of maintaining competition;
social equality - the market distribution of income is determined by the amount of capital invested or the amount of individual effort, while achieving relative equality requires a vigorous social policy. Social policy is based on the search for compromises between groups with opposing interests, as well as on the direct participation of the state in the provision of social benefits, for example, in housing construction;
countercyclical regulation;
stimulating technological and organizational innovation;
structural policy implementation;
protection and promotion of competition. The listed features of the German model are derived from the fundamental principles of the social market economy, the first of which is the organic unity of the market and the state.
The Japanese model is a model of regulated corporate capitalism, in which favorable opportunities for capital accumulation are coupled with the active role of government regulation in the areas of programming economic development, structural, investment and foreign economic policy and with a special social significance of the corporate principle.
The Swedish model is a social democratic model that gives the state the place of the supreme socio-economic power. The democratically elected government is delegated enormous powers to regulate socio-economic life. However, it must be admitted that the conceptual differences between the social market economy and "Scandinavian socialism" are erased in practice.
Thus, modern countries have embarked on a course towards building a socially regulated market economy, which underlies the concept of a "mixed economic system".
3.1. The concept of a transitional economic system and its types
A transitional economy is, as a rule, the economy of the administrative-command system in the process of its transformation into a market economy. At the same time, not only the economic policy and methods of management are changing, but a radical transformation of the entire socio-economic system is taking place. As a result of the transformation, all elements of the economy are changing: property relations; the relationship between production and consumption; type of reproduction; goals and means of economic development; institutions.
The specificity of the transitional economy is determined primarily by the withering away of its so-called socialist characteristics and the emergence of a modern market economy based on private property. At the same time, the post-industrial society demonstrates the possibility of preserving and further developing the trend of socialization of the economy and, on this basis, the formation of a socially oriented economy.
There are 3 stages of transformation of the transitional economy:
1. The preparatory stage, during which there is a gradual decomposition of the old system; its end result is a socio-economic crisis.
2. Direct transformation of socio-economic relations through the mechanism of active institutional transformations. At this stage, the old mechanisms of the economy are being destroyed, and at the same time, there are still no established new mechanisms. In these conditions, non-economic factors acquire a particularly large role; first of all, the role of the state as a business entity increases.
3. The stage of exit from the transition period, the gradual completion of the creation of institutional foundations for the reproduction of a new system of production relations on its own basis.
Institutional transformations inherent in a transitional economy are as follows.
Liberalization is the abolition of restrictions and prohibitions related to economic activities. The first stage of liberalization in a transitional economy was price liberalization, as a result of which enterprises began to independently set prices for their products. One can also note the liberalization of foreign trade, which abolished the state's monopoly on foreign trade.
An important factor in institutional transformations and the formation of a market economy is privatization as a way to recreate private (and joint-stock) property. Privatization is also a prerequisite for the effective management of entrepreneurs.
The most important element of the transition economy is the creation of new rules of the game for now independently operating enterprises, i.e., a radical transformation of law and legislation. Otherwise, it is impossible to build a new system of economic relations between the enterprise and the state, as well as between the enterprises themselves.
The process of transition to a market economy in different countries, depending on historical, socio-economic, geographical factors, is carried out in different ways. However, it is possible to single out general patterns characteristic of all countries.
The main regularity in such a transition is a change in the role of the state. The transfer of a significant part of the property (denationalization) to private ownership leads to the fact that the state, while remaining an economic entity, ceases to be a monopoly of all property of society.
At the same time, the state retains its position as a subject of economic law, as well as a subject of macroeconomic regulation. So, in the transitional period, when the role of law is extremely strengthened, and there is also a structural restructuring of the economy, the role of the state not only does not decrease, but increases.
In addition, the state also performs production functions, since it still dominates the military-industrial complex, in some infrastructure sectors, in the social sphere, and in fundamental science.
Another regularity of the transition economy is the implementation of privatization; its pace and methods depend on the specifics of the development of countries and the ideology underlying the reforms.
In a transitional economy, financial stabilization is also under way in all countries. Since the economy that preceded the transition was a deficit economy, the entry into a market economy is inevitably accompanied by inflation.
Financial stabilization is the most important prerequisite for stabilization, and then for economic growth.
The pattern in a transitional economy is the so-called transformational recession. When the old planning mechanisms of the economy are destroyed, and the new market regulators are still weak and do not fully function, the economy falls into a deep crisis. This crisis is determined by many factors:
the ratio of prices;
non-competitiveness of domestic products;
import competition; rise in the cost of fuel, raw materials, transport, etc.
Therefore, the transformational recession also requires a strengthening of the role of the state in order to mitigate the negative consequences of the economic transition.
In a transitional economy, the process of integration into the world economy is taking place.
The transition to an open economy is very important, because it removes the tendency to preserve economic backwardness, makes the economy open and ultimately competitive.
Since all countries are different from each other, not only the transitional economy, but the very nature of the transition in them is different. Two types of transition from an administrative-command economy to a market economy can be distinguished: a gradual transition extended over decades (gradualism) and reforming according to the principle of "shock therapy". Gradualism (English gradual - gradual) has spread in countries such as China, Vietnam, Hungary. The characteristic features of this type of reform: the significant role of the state, as well as the neutralization (through state regulators) of the most negative social and economic consequences for the population, primarily the consequences for the standard of living. So, for example, China began to reform its economy in the 1980s. and now, due to economic growth (rate of 10% per year), it has become one of the ten leading countries, while significantly increasing the standard of living of the population. A specific feature of the Chinese economy in transition is that during the implementation of market reforms in many areas, strict state control remains. In particular, small business has developed enormously in China, and at the same time, within the framework of free economic zones, the latest models of equipment and technology are being developed, and large-scale production is being improved.
"Shock therapy" based on the theory of monetarism (assigns money to a decisive role in the oscillatory movement of the economy), assumes minimal participation of the state in the transition economy. The main thing in the activities of the state is to ensure financial stability, because, according to monetarists, anti-inflationary policy, due to hard budget constraints, ensures a successful transition to the market. Severe budgetary constraints are prerequisites for the transition of enterprises to self-sufficiency. "Shock therapy" (as a result of price liberalization) presupposes a sharp decline in the standard of living of the population (which is why it bears this name), but it is believed that this period, as a result of successful reform, can pass quite quickly (2-3 years). Then, both an upswing in the field of economy and an increase in the standard of living of the population begins. The "shock therapy" doctrine has been successfully implemented in Poland (1990-91), Czech Republic, Estonia. These countries have now entered the stage of economic growth.
Reforming the administrative-command system has shown that the more it is introduced into the economy, the more difficult is the process of transition to the market. This fully applies to all countries in the CIS, including Ukraine, where over the 70 years of Soviet power, economic relations have developed that are most remote from the market economy. Carrying out a complex of reforms - privatization, structural restructuring of the economy, tax reform, reform of the social sphere, and others - requires a period of time that goes far beyond the scope of "shock therapy".
3.2. Features, problems and prospects of the Ukrainian economic model
Thus, the concepts of the transition economy discussed above reveal the goals and objectives of the reforms, the constituent elements of the transformations, the methods and stages of reform. With regard to the transitional economy of Ukraine, the following general features of the transitional economy can be distinguished. Forming the specifics of its contradictions:
Instability of business conditions;
Deformation of the economic structure;
Uncertainty of the driving forces of development;
Strengthening the influence of the expectation factor on the economic situation;
Loss of control over macroeconomic processes;
Heterogeneity of motivation for economic behavior;
Lack of a mechanism for self-regulation of the economy;
Lack of institutional structure;
The presence of many sectors of the economy, including the shadow.
The scale of economic transformations in Ukraine in recent decades is very wide. It is believed that Ukraine is undergoing three whole transformations at the same time: the transition from totalitarianism to democracy, from the state of a part of the national economic complex to an independent economy, and from economic decline to recovery and growth. Few countries in history have had to tackle these three problems simultaneously. Nevertheless, the financial chaos and hyperinflation were overcome (inflationary processes, see Appendix A) caused by the budget deficit, legal and economic institutions of a market economy were created, and structural reforms of the economy began.
There are three main transformation flows in the structure of market transformation:
Initial capital accumulation as fundamental. Leading process;
Restructuring the economy in accordance with the new patterns of its functioning;
Socialization of the economy as a process opposite to the initial accumulation, designed to extinguish the tensions generated by the two previous processes.
The transformation process in Ukraine has also led to serious social changes: increased income differentiation (the subsistence level, see Appendix B), a decrease in social security, unemployment, and so on.
The totality of economic processes taking place in a society on the basis of economic relations and organizational forms operating in it, is the economic system of this society. An indispensable accessory of economic systems are components, parts, that is, what it consists of and without which it is impossible. There are a lot of components of the economic system and this characteristic of the system is of decisive importance in the comparative analysis of various systems.
National economic systems can have different components, and when typing economic systems, this characteristic is of decisive importance. For example, in a planned economy, there was simply no need for a monetary system or a network of commercial banks. Although the problem remains controversial, this feature is decisive in the classification of economic systems.
The structure of the system, the compatibility of the elements included in it also determines the essence of the economic system. The system is stable and functions effectively with the compatibility of parts, the interaction of which ensures the development of the system. This feature is of particular importance for the development of problems of transformation of economic systems. The destruction of the main element of the system leads to the destruction of the old system, and not to the main elements - to a gradual transformation (shock therapy or gradualism during reforms).
The most important feature of a complex system has an internal structure of interconnected elements, its purposefulness, its desire to achieve a specific goal. Together with the means to achieve the goal - this feature is the functional aspect of the system. From this it follows that the transformation of the economic system is not an end in itself, but a means of solving a certain target function.
The system functions in an environment external to it, with which it is associated with a variety of communications. The target orientation to the system is transmitted from the system of a higher order. In relation to the economic system, this means that a given society sets certain goals for it and, depending on this, evaluates this system by means of a certain set of indicators.
And finally, there is the management aspect of the system, without which the system cannot purposefully develop. Regardless of whether the management decisions are objective or subjective, the very systematicity presupposes the presence of this attribute.
There are three main four economic systems.
In economically underdeveloped countries, there is a traditional economic system. This type of economic system is based on backward technology, widespread manual labor, and a diversified economy.
The administrative-command economy is an economy in which the state form of ownership dominates and the main, as well as less significant economic decisions are made at the highest level of management.
The market system is a way of organizing economic life in which capital and land are privately owned, and the allocation of resources, production, exchange and consumption of goods and services are carried out on the basis of supply and demand.
A mixed economic system is defined as a way of organizing economic life in which land and capital are privately owned, and the distribution of resources is carried out both by markets and with significant participation of the state.
In addition to these named systems, there is also a transitional economy, which has a number of specific features for each individual country. The transition economy is the economy of the administrative-command system in the process of its transformation into a market economy. This system is typical for the Ukrainian state.
In conclusion, we note that with a conscious transformation of the economic system, the main condition for preventing its final disintegration is the "smooth" removal of "unnecessary" elements and the introduction of new ones; to enable them to adapt to the new environment and avoid the incompatibility of elements in this particular economic system.
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Summary table of inflation indices.
Month | 1991 | 1992 | 1993 | 1994 | 1995 | 1996 | 1997 | 1998 | 1999 | 2000 | 2001 | 2002 | 2003 | 2004 | 2005 |
January | 385,2 | 173,2 | 119,2 | 121,2 | 109,4 | 102,2 | 101,3 | 101,5 | 104,6 | 101,5 | 101,0 | 101,5 | 101,4 | 101,7 | |
February | 115,3 | 128,8 | 112,6 | 118,1 | 107,4 | 101,2 | 100,2 | 101,0 | 103,3 | 100,6 | 98,6 | 101,1 | 100,4 | 101,0 | |
March | 112,1 | 122,1 | 105,7 | 111,4 | 103,0 | 100,1 | 100,2 | 101,0 | 102,0 | 100,6 | 99,3 | 101,1 | 100,4 | 104,3 | |
April | 107,6 | 123,6 | 106,0 | 105,8 | 102,4 | 100,8 | 101,3 | 102,3 | 101,7 | 101,5 | 101,4 | 100,7 | 100,7 | 106,7 | |
May | 114,4 | 127,6 | 105,2 | 104,6 | 100,7 | 100,8 | 100,0 | 102,4 | 102,1 | 100,4 | 99,7 | 100,0 | 100,7 | 108,1 | |
June | 126,5 | 171,7 | 103,9 | 104,8 | 100,1 | 100,1 | 100,0 | 100,1 | 103,7 | 100,6 | 98,2 | 100,1 | 100,7 | 109,5 | |
July | 122,1 | 137,6 | 102,1 | 105,2 | 100,1 | 100,1 | 99,1 | 99,0 | 99,9 | 98,3 | 98,5 | 99,9 | 100,0 | 109,8 | |
August | 104,0 | 108,3 | 121,7 | 102,6 | 104,6 | 105,7 | 100,0 | 100,2 | 101,0 | 100,0 | 99,8 | 99,8 | 98,3 | 99,9 | |
September | 104,5 | 110,6 | 180,3 | 107,3 | 114,2 | 102,0 | 101,2 | 103,8 | 101,4 | 102,6 | 100,4 | 100,2 | 100,6 | 101,3 | |
October | 105,9 | 112,4 | 166,1 | 122,6 | 109,1 | 101,5 | 100,9 | 106,2 | 101,1 | 101,4 | 100,2 | 100,7 | 101,3 | 102,2 | |
November | 116,5 | 122,0 | 145,3 | 172,3 | 106,2 | 101,2 | 100,9 | 103,0 | 102,9 | 100,4 | 100,5 | 100,7 | 101,9 | 101,6 | |
December | 124,6 | 135,1 | 190,8 | 128,4 | 104,6 | 100,9 | 101,4 | 103,3 | 104,1 | 101,6 | 101,6 | 101,4 | 101,5 | 102,4 | |
In just a year | 390,0 | 2100,0 | 10256,0 | 501,0 | 281,7 | 139,7 | 110,1 | 120,0 | 119,2 | 125,8 | 106,1 | 99,4 | 108,2 | 112,3 | |
Average monthly growth rate | 121,0 | 128,9 | 147,1 | 114,4 | 109,0 | 102,8 | 100,8 | 101,6 | 101,5 | 101,9 | 100,5 | 99,9 | 100,7 | 100,9 | |
CAGR | 1627,0 | 4835,0 | 991,2 | 477,0 | 180,3 | 115,9 | 110,6 | 122,7 | 128,2 | 112,0 | 100,8 | 105,2 | 109,0 |
The size of the subsistence minimum
Social and demographic population groups | The size of the subsistence minimum | ||||
for 2000 rubles (Law N 2025-III dated 05.10.2000) |
for 2001 рік (Law N 2330-III dated 22.03.2001) |
for 2002, 2003 rock (Law N 2780-III dated 15.11.2001) |
for 2004 rіk (Law N 1704-IV dated 11.05.2004) |
for 2005 rik (Law N 2089-IV dated 19.10.2004) |
|
Children under 6 years of age | UAH 240.71 | UAH 276.48 | UAH 307 | UAH 324.49 | 376 hry. |
Children from 6 to 18 years old | UAH 297.29 | UAH 345.66 | 384 hry. | UAH 404.79 | 468 hry. |
Able-bodied population |
UAH 287.63 | UAH 331.05 | 365 UAH | UAH 386.73 | 453 UAH |
Lost the ability to work | UAH 216.56 | UAH 248.77 | 268 hry. | UAH 284.69 | 332 hry. |
General indicator | UAH 270.10 | UAH 311.30 | 342 hry. | UAH 362.23 | 423 hry. |
There are four models of the economy:
- The traditional system is based on the distribution of all benefits, taking into account class affiliation. Old customs and traditions with a predominance of manual labor, which is characterized by primitive land cultivation, continue to be used in underdeveloped countries.
- The command or administrative model is based on state ownership and control over the results of the use of material resources. All decisions regarding production, distribution or consumption are made by the government. A striking example of the command model is the communist system in the USSR.
- The capitalist or market model is based on personal interests. It is often referred to as free competition capitalism or pure capitalism. A characteristic feature of the model is the non-interference of the government in the economy. All resources and results of activities are considered private property.
- The mixed model assumes the interaction of state influence with the economic freedom of entrepreneurs. Manufacturers and the working population have the opportunity to independently choose a field of activity and a company for employment.
National economic models
Each system has its own characteristic features of the organization of the economy associated with national differences. They differ in historical conditions of development, traditions and customs of the population, geographic location, availability of natural resources and many other factors. But apart from the differences, there are common features, including: different forms of ownership, the presence of entrepreneurial activity, the desire for free competition and independent pricing, as well as the presence of state regulation. There are seven known national economic models:
- The American model is based on encouraging entrepreneurship to enrich a more active population. Low-income strata of the population receive state support through subsidies and benefits. As a result, there is a noticeable difference in wages between workers and managers, and the population is divided into rich and poor.
- The Japanese model is characterized by a long-term development plan and a high level of government influence in the main areas of the economy. National identity is expressed in the readiness of the population to sacrifice their income and benefits for the prosperity of the country. Compared to the American model, the wage gap between the head of the company and the employee is negligible.
- The South Korean model has common features with the Japanese model, which are expressed in the active participation of the state and development planning. To reduce unemployment, special programs have been created, and price stabilization funds are working effectively.
- The German model has similarities in socio-economic content with the Japanese model. The influence of the state is focused on meeting social needs in the form of tax breaks for start-up entrepreneurs and the payment of unemployment benefits.
- The Western European model is characterized by increased attention to social needs, infrastructure creation and interstate integration.
- The Swedish model is based on reducing wealth inequality through income redistribution. The government is actively involved in maintaining low unemployment, fixing prices and ensuring stability.
- The Chinese model is a vivid example of a mixed economy, where the market system operates under government regulation.
Thus, the identification of similarities in different economic systems does not prevent the manifestation of specific features in national models of the economy.