Characteristics of Market Socialism

Under market socialism economic activity is primarily coordinated through markets but, as
compared to market capitalism, the government plays a greater role in the economy. This
expanded role can be through the provision of an array of government services funded
through taxation, such as public health care and education. The government may also own a
greater share of the factors of production, which could include natural resources such as
public lands and fossil fuel reserves, public research facilities, and state-owned companies.

Comparative-Economic-Systems[1].pdf

Market socialism is an economic system in which firms and means of production are owned
and controlled by the government. Yet, firms sell their products to consumers in competitive
markets. In other words, market socialism is based on social (cooperative or public)
ownership of the means of production but within the context of a market economy.
In market socialism, the government is largely involved in the economic sphere but private
property is not entirely abolished. In fact, while in socialist systems everything was owned
and controlled by the government, in this case, enterprises work within the framework of a
competitive market economy.

When we consider the means of production, we can identify two types of market socialism:

 Cooperative ownership of the means of production in a market economy: employees

are at the core of this system. Workers own the enterprises as well as the profits of
their operations; and
 Public ownership of the means of production in a market economy: in this case, firms
are owned and managed by public authorities while profits are divided among all
citizens.

Difference between Mixed Economy and Market Socialism | Difference Between

A. MARKET SOCIALISM: Given the failures of central planning and the socialization of
all three factors of production in the USSR and elsewhere, there has been a renewed
interest in a form of socialism which allows a limited market in capital as well as goods
and services. Labor is excluded from free market dynamics in that work is essential not
only for buying things but for its social psychological benefits mentioned above.

There are some interesting versions of market socialism around. In the USA, John
Roemer and Dave Schweickart are drawing the most interest. References below. The
Radical Philosophy Association recently sponsored a Symposium on the work of
Schweickart. The highlights of the Schweikart plan are:
 1. All firms above a given size would be funded by the state. This socializes capital to
some extent. Size is also not speciified. Some say firms with 20 or fewer workers can
be privatized; some say 300 workers...very important question since those workers
have no reliable connection to either production or distribution of essential goods.
And exploit- ation...a nasty word in marxian theory...can still occur.
2. Each firm would pay a use tax on the monies provided by the state. This is really a
standardized form of interest. lots of problems when the state sets interests rates; more
when banking cartels do so.
3. Each firm would be worker managed. There are lots of advan- tages to worker owned
and operated firms; higher quality, less waste, better maintenance, less worker turn-
over or absenteeism and higher profits.
A problem arises since solidarity begins and ends within the shop, plant, mill, store or
factory. Customers and competing worker-owned firms become class enemy.
4. Each firm would buy and sell its products/services on the market.
5. Thus both capital and labor is, to great extent, socialized, but goods and services still
commodified. Those who do not cannot work are thus excluded from life's
necessities. And a free market in some goods/services might still degrade.
6. Each firm would set aside funds to replace/rebuild/expand

MARKET SOCIALISM (critcrim.org)