Talk:Market socialism

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Dear Wikipedia[edit]

I have no article to add here, but I have one important point to make.

I believe that this article, and every articles published here in Wikipedia for that matter, is well written and edited by accomplished scholars. However, names of contributors and editors are not mentioned. As a result, readers are reluctant to use Wikipedia as a serious and reliable reference.

I suggest that for every single article, Wikipedia prints both the names of the author and editor. Also, that their names be hyperlinked to a corresponding page that shows their background and expertise. This is to eliminate any remaining doubt about this Encyclopedia's scholarship and credibility.

More power to the principles behind the making of Wikipedia!

--hs

Have a look at the "page history" link at the bottom of each article. It tells exactly who made which changes when. I don't think that there is a need for contributors to list their expertise. --snoyes 15:23, 24 Nov 2003 (UTC)

Perhaps instead of just being about Chinese socialism post-mao it should be about various types of "market socialism" including "goulash socialism" in Hungary in the late 1970s and 1980s, Czech style socialism in the 1980s etc? Also, what is the NPOV objection to the current article? AndyL 05:29, 8 Jul 2004 (UTC)

A Different Take[edit]

My take on the subject is that Market Socialism is a system where workers are the owners of their place of work (they receive the "profits") and the economy work as an in a capitalist system, but without the capitalists. The model is developed in David Schweickart's 2000 "Against Capitalism". User: Horzer

Just curious. In a capitalistic free market, everyone is free to buy goods and services. Some of those goods and services can be combined, as means of production, to produce new goods. For example, you or I can rent some commercial space, lease an oven, buy flour, yeast, salt and water, and hire some help, to bake and sell bread. Someone else might start a business creating ovens. Someone else may open an oven leasing company - buying ovens and leasing them out to new bakers. In a capitalistic free market, people do these things in order to earn a profit by recognizing where demand exists, and how they can fill it. If they are right, they are rewarded with profit. They are motivated to earn the profit so that they can purchase a home for the family, send the kids to college, vacation in Hawaii, retire early, etc. In a Market Socialism "free market", since the workers "own" the bakery, oven factory and oven leasing company, why would anyone create these businesses in the first place? What would motivate people to innovate? If not to earn a profit, then what would cause people to care to solve other people's problems? Does Market Socialism rely on human nature being something that it isn't?
And where would the initial capital required to start just about any new business come from? Is some bureaucracy going to dole out seed capital money to various groups of cooperative workers? How would it decide which groups get how much money? How will this kind of decision process compare in efficiency of scarce resource utilization (including labor) to the one utilized in a capitalist free market, where the free market makes these decisions? --Serge 01:31, 22 July 2005 (UTC)[reply]
Basically, the idea is that a democratically controlled enterprise is more efficient that a capitalist one, because the called X-inefficiency derived from neccesities of control over workers doesnt exist, or is minor. Is a known phenomenon that you care more about a place when you own it. A group of workers could unite to ask for a loan and start a bussiness, in this they're no different than a capitalist. The difference is that the profits will be distributed only between those that work. The drive to innovate comes from the free market, and not from capitalism (this is an important point). Socialist critics of Market Socialism point that this system stays too close to self-explotation by the workers; I believe it to be the system that rationally will replace capitalism if some political (power) barriers are dismantled. I don't think that leasing would be permitted, only the sale of the oven (like I see stupid that I need to pay rent to somebody only because he owns an appartment). Payments are only done in exchange of work. An oven is work, a car is work, interest rates are not work. The free market doesn't decide nothing, even in capitalism people do: the matter is which people. In market socialism people still decide based on free market: free sellers and buyers reaching an agreement. The only difference is the ownership of each production place.
In Schweickart's system I remember a series of "social banks" financed by a kind of capital tax to the gains of the different companies, that would decide to who lend money based in social objectives BUT with responsability: this means lend money to plans that have the possibility of success. Regular banks today act in irresponsible ways, giving zillions to corporations that some times "fall" into bankrupcy (I said "fall" because we all know were that money goes, to some pockets of irresponsable people). Enterprises in Market Socialism would be let to fail or to success as in capitalism; in the case of failure workers would be absorved into new plans or existing ones. So why to work hard? Because there would be differences in wages (from 4:1 to 6:1 between highest to lowest) and differences in esteem (what is socially valued). Obviously, any worker prefer to be the boss in his company that to fall again and start at the floor). There would be rich people: J.K. Rowling worked to create Harry Potter and she would reap the profits derived. What she can't do is to earn money from the work of other people only because she put money into an enterprise. To earn, you need to do. And to do is to work. Money doesn't work: people do. So incentives exist: you CAN be rich, if you success. But that success would be exclusively based in something you did, something valued so much by society that people are willing to pay to you money for it. Finally, scarce resource thinking is proper of neo-liberal economics. Resources (out of oil) aren't scarce. Yes, I know that you're refering to the allocation system. It would be more subdued than in capitalism, less "bombastic". Ok, I'm not running from the subject, I dont' have the answer right now in my head. To more details, go to Schweickart's books and all the debate surrounding Market Socialism and Economic Democracy.--User:Horzer 06:32, 22 July 2005 (UTC)[reply]
Thank you for your explanation. I agree money doesn't work, but I do believe deciding where to invest capital that will produce value is work, and very important (absolutely critical to the overall health of an economy), and doing the work to gain the experience and knowledge to make those decisions effectively is also work. In a capitalist system, that is the work of the entrepreneur. And if the entrepreneur does his work well, in particular if he does it better than others, he is rewarded with profit. If he fails, say by hiring the wrong people, or building something that costs more to produce than others are willing to pay, then he is not rewarded. In a capitalist system the best entrepreuners can start with a relatively humble investment and create huge industries that greatly improve the standard of living of billions of people (e.g, Henry Ford and cheap personal transportation for the common man, J. Paul Getty and cheap oil production, Howard Hughes and air transportation, etc., Bill Gates and affordable home and business computing for the masses). Such is the lure of doing entepreneurial work in a capitalist society. Who does the work of the entrepreneur in Market Socialism, and what would motivate someone to do that work? --Serge 18:34, 22 July 2005 (UTC)[reply]
Another way of creation of businesses in a market socialism is, actually, through the search of profit, but a very small level, like the bakery example above. Once the business grow, and it needs more labour, it would need to become a cooperative to grow.--Jfa 13:21, 22 July 2005 (UTC)[reply]
What or who would prevent a small business from growing without first becoming a cooperative, and how would they prevent it? --Serge 18:34, 22 July 2005 (UTC)[reply]
My first guess is legislation. If you can´t have more than 2 employees, or have more than one workplace (local), then if you want your bussiness to expand, you, as manager, would have to organise with your former employees to open a second bakery or barbershop or whatever. (However, made the law, made the cheat :) )--Jfa 13:01, 25 July 2005 (UTC)[reply]
Of course, legislation alone would not be enough. Someone would have to enforce these laws. Someone would have to fine and ultimately arrest a business owner who had the audacity to do something so horrendous as hiring a 3rd worker, someone eagerly looking for work. Does that really sound like a good idea to anyone? Who would benefit from such legislation and enforcement?
What would be the incentive for an owner to grow a business if he was forced to share his profits beyond a point that he believed to be worth his while to do the work it takes to grow the business? In fact, if he's limited to two (or whatever) employees before he is forced by legislation/enforcement to give up his profits, why start the business in the first place? Many people work their rear-ends off for a dozen years or so, just so that they could grow a business and then retire early, living comfortably from the profits of the successful business that they built. Not allowing them to do so removes the incentive to do the insane work to build the business in the first place. I honestly have a hard time understanding why anyone would do really hard work in a market socialist economy, and how such an economy would be able to sustain itself without the really hard work, much less produce a modern standard of living for the people living in it. --Serge 19:49, 25 July 2005 (UTC)[reply]
That's the issue: why should a man (or woman) live (retire early) from the work of others? However he work hardly to create the bussiness, once he stop working, why he should get money from other's sweat? Not everybody wants to retire early, most of us want to work (our ass off too, maybe) throughout our lives, and retire when we cannot work anymore. I think the goal is that everyone should work for its own substain (and that of people who depends of him or her) and a little more. In that scenario, richness is more an accident (the example of JK Rowlings above) than a personal search. Its my opinion, anyway.--Jfa 18:48, 26 July 2005 (UTC)[reply]
I will be no better than more experienced authors in trying to convince you about this. I'm not so good in ethics and philosophy, so I'm sorry. The thing is that you need to diferentiate between the entrepreneur (Schumpeters' "animal spirits") creating and the capitalist. If somebody chooses workers, he is working, and must be rewarded a wage according to that work. But if he puts money in an industry, people works and he receives profit from this work he is being a capitalist, this is, is receiving money from the fact that he put money (he is NOT working). All the first part of Schweickart's "Against Capitalism" is a discussion about the right of the capitalist to receive (or not) this profit (is a discussion on ethics in the end, on what is wrong and what is right). If the only thing the capitalist bring to the economy is money, so we can dispense of him. The entrepreneur is a different animal. Take note that Bill Gates didn't invent all (or most of) the stuff that goes out from Microsoft. If you've worked once in an organization, you know that workers tend to organize what they're doing in efficient ways and that many of the innovations come from below; many times the managers are the only thing stopping them from innovate. Most people in this planet would be happy with the profits derived only from their creations, as in the example of JK Rowling, without asking for profits derived from the work of others in their corporation (based in these first creations, as is the case with Microsoft or others). And so, Rowling deserves a part of the money from the selling of the books, and Bill Gates deserves part of the money of the programs he wrote. What he doesn't deserve is the profit derived from the work of hundred of programers doing something like "Word" (that I think he didn't create). Take note that some of those programs are based on the inventions of thousands of free-lance programers that didn't see a cent. Any capitalist is seating on the shoulders of a giant: our civilization's culture. --horzer 13:22, July 26, 2005 (UTC)

Venture Capital and Sole Owners[edit]

Thanks for this explanation. I understand the distinction between entrepreneurs and capitalists, but I don't believe I made it clear in my first question. I believe the following questions apply to all forms of socialism, including market socialism, but I will pose them in terms of this topic only:
In a capitalist society, entrepreneurs turn to VCs to raise startup funds. The work of the VC is to decide who among various entrepreneurs are the best investments. If they do their work well, and choose to invest in those businesses who create the most value for society, they are rewarded with high returns (profits) later (by "creating value for society" I mean that the value of the products and services produced by the venture in question is valued by society substantially more than the resources used in the process). VCs also use capital to help companies "turn around", by funding improvements in management, R&D, etc., for the purpose of increasing the companies ability to create value for society.
The better VCs do their job, the more value is created for society, and the more profits they earn, giving them more capital to invest in subsequent ventures. The market weeds out the poor VCs (the ones who make investment choices in ventures that do not create value for society by returning less of their capital to them than they originally invested). The worst ones repeat this process until they have nothing left. The good ones just keep increasing their capital and their ability to fund more and more ventures that create value for society. Thus, the role of VCs is critical to a healthy and growing economy, and I don't understand who would do that work in market socialism, or what would motivate anyone to do the work of VC in a market socialist economy. Most importantly, what mechanism would encourage those who do the job well to do more of it, and those who are not good at it to do something else?
Of what I can remember, the work of VC's (in fact, giving money) is done by "social banks" who give loans based in the possible success and future social value to be created by this specific company or group of workers trying to initiate a new business.--horzer 15:37, July 31, 2005 (UTC)
I think it's worth noting here that VCs are seldom supplying their own capital. They run the entrepreneurial arena in much the same way that Hollywood producers make movies: with OPM ("Other People's Money"). They gamble funds fronted to them by large institutional investors, some of the largest of which are pension funds (and public employee pension funds at that -- CALPERS, for example, is enormous). These pension funds were said by Peter Drucker (no less) said to have given rise to a tacit labor/capital/financial-sector arrangement he called "pension fund socialism": dispersed ownership of the means of production by unionized workers. One recent commentator [1] points out that this "socialism" at least meets Marx's requirement of not being "socialism in one country", but not exactly in the happiest way. "Pension fund socialism" is an interesting, if rather problematic (and not widely-noted) concept. Perhaps it merits some slight mention in this article. Yakushima (talk) 06:26, 22 August 2009 (UTC)[reply]
  • In a market socialist economy, who does the work of sole owners of business?
In a capitalist economy, many businesses, some with hundreds and even thousands of employees, are owned by individuals who are motivated by compensation that is entirely tied to the value created for society (expressed by the profit earned) by the business. The potential of theoretically unlimited compensations motivates many owners to work incredibly hard (up to twenty hours per day) and stay uniquely and incredibly focussed on and devoted to making the business successfull. Their work may include compensating managers with salaries and profit sharing, just as managers in a market socialist company are compensated, but there is no substitute for having an individual who is ultimately responsible for overseeing the overall value produced by the business, and being compensated accordingly. Who does the work of sole owners of businesses in a market socialist economy?
I don't know. I expect nobody to work 20 hours per day :). Taking into account that the managers are choosen by the workers and that income depends on how well the company does, the problem would be just the opposite: how to convince some people not to work so much.--horzer 15:37, July 31, 2005 (UTC)
  • What right does a worker have to any compensation (including part of the profit of the business that market socialism mandates) beyond the wage he agreed to take in return for the work he produces?
This depends on ethic and philosophical views on value: who creates it and who have the right of compensation for it. It is a tenant of market socialism that the capitalist only provides capital, and that value is not generated by it but by people working.--horzer 15:37, July 31, 2005 (UTC)
I don't understand this statement: "Take note that some of those programs are based on the inventions of thousands of free-lance programers that didn't see a cent." Most programmers are generally paid a salary or hourly contract wage for the software that they design, produce, test, package and debug. They agree to do this work in return for the salary or wage that they are paid, and they agree that the product of their work belongs to whoever is paying them to do the work. Whether that work contributes to a product that flops or greatly succeeds depends much more on the work of those paying the programmers, than the work of the programmers themselves. This same principle applies to all workers. You can hire an architect to design a house, and workers to build it. The carpenters are paid their wages regardless of whether the design ultimately fails and the house collapses, or whether it turns out to be a masterpiece worth many times the cost of the materials and labor used in building it. The value of the carpenters' work is the same. As is the value of the work of the programmers. Why should they be paid more or less depending on the value of the overall product that they are working on, something they have little or no effect on? Yet isn't market socialism about paying workers according to such a principle?
Value exists only when is realized (Marx). Again, I need to come back to Das Kapital (Marx, Das Kapital) for the right logic, and I am maybe wrong, but if value is not realized (this is, if the thing is not really valuable for society) so is not counted as value (yes, I know, I need to go back to the books to look for the right statements). It seems that "value" in Marx is only "socially valued".--horzer 15:37, July 31, 2005 (UTC)
  • How is profit sharing distributed in a market socialist economy? That is, who determines who gets how much of the profit, and how is that determined? In a company in a capitalist economy, the earner of the profit may choose to reward certain or all workers with a portion of the profit, according to whatever scheme he chooses. Ultimately, the better he distributes the profits in such a way as to best motivate the workers, the more profit he earns (continues...)
This is not true. His profit don't always depends in the distribution to workers, specially in a situation of high unemployment where workers cannot freely decide where to work without risk of loosing their social position or dying of hunger (depending on which country we are speaking of).--horzer 15:37, July 31, 2005 (UTC)
  • (continuation) Hence, there is a built-in mechanism to bias profit distribution towards optimizing the value produced by the company. What regulates profit distribution in a business in a market socialist economy so that the workers are motivated such that the value (to society) produced by the business is optimized? --Serge 19:20, 25 July 2005 (UTC)[reply]
The workers decide which part of profit to reinvest and which part to distribute in a democratic manner. If they dont want to loose their job, they will do it thinking at the long view (which is the English word for "plazo"?) Is possible to expect workers not to play games with their job place, and to work for their betterment. When you rent an appartment you don't have many incentives to make it more beautifull; when you own a house and you think you go to live there a long time, you make every effort possible to conver it in the best house in the world.--horzer 15:37, July 31, 2005 (UTC)--horzer 14:36, August 1, 2005 (UTC)
For more information: David Schweickart's "Against Capitalism", analysis and comparison between laisez faire, keynesian capitalism, Rawls kind of "fair capitalism", possible transitions to "Economic Democracy" starting with a discussion about justifications of who receives the value produced in society and why, followed by what Schweickart believes can be a better economic model for society.

Value[edit]

Serge: The issue of value is a conflicting one. As a neo-marxist, I believe value (different from price) is resources+labour (and not "force of labour" whose value is the wage). Of course, thousands of neo-liberal economists and Schumpeter (and I care about what he says) would tell me that the "objective theory of value" is a little bit outdated. The problem is to determine from where comes this surplus value after all wages and resources has been paid on. Marx had a solution: the worker produce this value and the capitalist simply takes it (and pay him for the "force of labour" in the form of a wage: "force of labour" (what we call work) is the only commodity in Marxism that produces more of its cost). My statement about programers was not related to wages, sorry. If someone out there would help or add to my explanations I would be happy (time constrictions).--horzer 14:03, July 26, 2005 (UTC)

You wrote that the programmers "didn't see a cent". If they were paid for their labor, like all workers, how is it that they "didn't see a cent"? --Serge 14:37, 26 July 2005 (UTC)[reply]
It is a fact that we all value everything, products and services (labor), including our own time, differently and subjectively. If we didn't, then we would never trade anything. I value dark chocolate more than white chocolate, for example. A wife may value clean windows in the house more than a husband, and may therefore be more willing to use a larger portion of the monthly household budget on window cleaning services than is the husband. Every worker puts in time and energy to do his job. He values this time and energy a certain amount, which can be expressed in terms of anything else he values, including money. If someone offers him more money than his time, skills, expertise and energy is worth to him, then he is likely to do the work. Even better, different employers are likely to value the worker's time,skills, expertise and energy differently as well. In a capitalistic free labor market, the worker is free to sell his time, skills, expertise and energy to the employer who values his offering the most: the one willing to pay him the highest wage.
The "surplus value" comes from the product being more valued by society than the wages and resources used to produce it. If you combine flour, water, yeast and salt and heat, then you will produce bread. If you do it in the right proportion, and do it efficiently, then the resulting bread will have a "surplus value" over the value of resources and wages used to make the bread. But if you do it wrong, or inefficiently, then you will have no "surplus value". My point is you can have two bakeries: one making money (creating surplus value) and one losing money (destroying value). The hired workers in both bakeries are likely being paid comparable wages and doing comparable work. The difference may be in the bread recipe used, or the cost of the ingredients used, how well or poorly the workers are being managed, etc. etc. To assume the "surplus value" belongs to the workers makes no sense to me.
Also consider that wages paid for work are a simplification of the actual transactions that take place between an employer and a worker. In the relatively simple case of a bakery worker whose job is to mix the basic ingredients into dough, and earns, say, $10 an hour, effectively, the following transactions occur each hour:
* A worker whose job is to knead dough buys a certain amount of ingredients, say for $40. Note that these ingredients are worth more than $40 to the worker (or he wouldn't buy them).
* The worker combines the ingredients for an hour and creates dough kneaded into, say, one hundred unbaked loaves.
* The worker sells the 100 unbaked loaves to a second worker - the one who runs the ovens - for $50, hence earning a "profit" (or wage) of $10. Note that the unbaked loaves are worth less than $50 to the first worker (or he wouldn't sell them for $50), and that the loaves are worth more than $50 to the second worker (or he wouldn't buy them for $50).
* An hour later the second worker sells the 100 baked loaves to the bakery for $60 (thus earning $10 for his hour of labor).
If the bakery now sells the 100 loaves for $40 (losing money), $60 (breaking even), or $80 (earning a profit), what relevance does this have to whether the workers are being exploited? The first worker was paid for the surplus value (from the perspective of the second worker) that he created. The second worker was paid for the surplus value (from the perspective of the bakery) that he created. What claim do the workers have on any additional profits the bakery may or may not earn in selling the bread? This is a simple example, but the same reasoning applies to any voluntary (not forced into slavery) worker situation in any job in a capitalistic free market. --Serge 14:37, 26 July 2005 (UTC) (updated, Serge 17:11, 26 July 2005 (UTC))[reply]
I confess that I didn't read all this post (my shift is coming to an end and my head is exploding) but I tell you that Marx based his theory in an "objective theory of value". This theory was discredited in 1870s by the neo-classics, but for some still holds. Again, value isn't price. In a perfect competition economy (like that one of all neo-classic models) price oscilates around "value" but not need to be the same. The bakery must sell bread at a price close to the value, that is: "dead" work (resources) + live work (wages) + surplus value (the rate of profit in perfect competition). Oh, my shift is over... till this weekend.
Yes, yes, value is not price. But how does one measure value? You say the bakery must sell bread at a price close to the "value" which you define in terms of costs + profit. But is that really the value? It is, for products worth selling. For some products the costs alone amount to more than the value (e.g., pure electric car, at least for now). What is the "value" of a bottom less bucket? The cost might be only slightly less than a bucket with a solid bottom, but its value is neglible, because a bottomless bucket is essentially useless. The only way I know to measure value is relative to something else. And money is very convenient for this. Do you value a pound of apples more or less than a pound of oranges? Can you know, unless you're first able to approximate the respective values in terms of price? Anyway, no hurry, but if in the next few days or weeks you have some time to read and mull all this over, I would appreciate further thoughts and explanations. I'm just looking for a proponent of market socialism to explain to me how it would solve the problems solved by a free labor market in capitalism. --Serge 22:36, 26 July 2005 (UTC)[reply]

David Schweickart's Market Socialism[edit]

David Schweickart's work should definitely be mentioned in this account. He's one of the top proponents of market socialism in the U.S. today. His book 'After Capitalism' is an excellent introduction to the topic. Reviews of his book and additional essays by him on China and market socialism are at [2].

Submitted by Carl Davidson, carld717@aol.com

Need for more analystical material on experiences of market socialism is Vietnam, Yugoslavia, and Hungary[edit]

It would be great if there were more commentary, reflections and links to information on the experiences (both successes and failures) of market socialism in countries such as Vietnam, Yugoslavia, and Hungary. It would seem that the only future for a viable socialism is to be found in how it can incorporate the efficiency and dynamism of the market into a system that ensures both social justice and environmental sustainability. The is the great intellectual challenge for all individuals who worry about the direction humanity is taking and continue to believe that a Better World is Possible. I would recommend two excellent books for like minded thinkers. One excellent book in this regard is "Market Socialism - the Debate among Sociallists" by Bertell Ollman and others. Another recommendable book is "Eco-socialism or Eco-capitalism" by Saral Sarkar. Hopefully there will be more contributions to this extremely important topic. Posted by Gregory Biniowsky in Havana Cuba

Suggestion to merge this page with Socialism[edit]

I think we simply must put a link in 'Socialism' with a short reference and 'Market Socialism' must stay independent. This is the hottest subject in social sciences (from the left side of the political spectrum) and the page is bound to grow in the next months/years. --horzer 09:39, 5 November 2005 (UTC)[reply]

Agreed, Market Socialism more than deserves an article of its own. --Blorg 22:54, 5 December 2005 (UTC)[reply]
Central to the concept of socialism is that the population owns the means of production. As a result, no money is needed as goods are free and services are by volunteer. Combining "market socialism" with real socialism betrays the real meaning of socialism. They must remain as distinct pages. --Telefina 2005.12.06
A very bad idea to merge. Am scrapping the tags. The Land 16:52, 30 December 2005 (UTC)[reply]
Perhaps best to leave it separate. Wondering why no mention of participatory economics, which is not exactly market socialism but has similar aspects (dispersed decision making) and is, I would argue, more theoretically sound as market socialism is a compromise in the face of material circumstances. a situation that results in market-driven socialist economics implies that the old game of building socialism in one country as a kind of independent path. james
Please do not merge this page with Socialism. The American propaganda system has tarnished the word 'Socialism' to no end, to mean a dystopian dictatorial nightmare of central corrupt control. Although 'market socialism' can mean many things (for example I strongly disagree with the idea above that "no money is needed"), at least it is obviously different from the central-planning ideologies such as Communism and some forms of Socialism. Jos — Preceding unsigned comment added by Jos Boersema (talk • contribs) 16:41, 12 October 2018 (UTC)[reply]

Original research[edit]

This article has a lot of unreferenced statements, especially the speculation that Marx was a market socialist. That definitely looks to be original research. -- Cielomobile talk / contribs 06:34, 8 October 2006 (UTC)[reply]

Marx was not a market socialist, but I´ve read some articles where Mrx shows admiration for cooperativism as a way to get surplus-value back from capitalists to workers¨[pablo podhorzer]

Since no one has given any references to back up the speculation that Marx was a market socialist, I am going to go ahead and remove that claim from the article. --SirEditALot 14:36, 10 August 2007 (UTC)[reply]

Two Opposing Concepts[edit]

It looks like 'market socialism' describes two opposing concepts: the first including mutualism, agorism, and some forms of syndicalism and collectivism, and the second including mixed economies like the NEP. Market-Socialism-1 is characterized by the absence of state subsidies, of monopolies, etc., with most workers either self-employed or cooperatively so. Market-Socialism-2 is characterized by the presence of state subsidies, state monopolies, and/or state-driven-redistribution plans, with most workers employed by hierarchical businesses. Do Market-Socialism-1 and Market-Socialism-2 have anything in common? I suggest retitling this article 'Market Socialism (Mixed Economy)' and adding a disambiguation page. Jacob Haller 19:23, 16 November 2006 (UTC)[reply]

Fundamental Principles of Socialism[edit]

If state control were one of the "fundamental principles of socialism" then anarcho-communism, anarcho-collectivism, etc. would not be socialist. If collective ownership were one of the "fundamental principles" then anarcho-communism and anarcho-collectivism would qualify, but anarcho-mutualism still wouldn't. Jacob Haller 22:54, 28 January 2007 (UTC)[reply]

I'm new to the study to economics and socialism. I just wanted to put in my thoughts and see how someone who understands the subject more than I would respond. To the idea that there would be no motivation to start a business I had a thought similar to the one mentioned that there would be a restriction on the number of workers etc. I thought that for example a man makes a coffee shop like starbucks. He is successful in his investment and a few years down the road he begins to see huge profits. Let's say he eventually makes 1 million in profits (I used 1 million just to keep it simlple). At that point the Socialist body would see anything over that amount excessive and would rather allocate the excess to the people. So in response the company is taken conrol by society, however you would percieve that. The next year the company makes 2 million. Now the original owner would recieve income up to the point of take over. He would in this case recieve 1 million every year after. The differnce in profits would be put in society where deemed necessary (health care to citizens that can't afford it such as the original owner). Now we say the year after take over the profits drop to under 1 million, let's say 500,000. In this case the original owner recieves one half of that years profits and again the rest to society. Dividing in half at a loss seems logical to me because that is the goal of socilism to devide the profits. At this point the original owner my have a loss but a man can still live more than comfortably on that income. The amount put into society is less but again is better than none at all. Now the original owner of the coffee shop can before, during and after the take over invest into starting another business. Now if he has two successful businesses than instead of 1 million after take over would recieve 2 million (1 million from each). Now say both businesses made 3 million a piece the next year after take over. The original owner receives 2 million and society recieves 4 million. You may say this isn't equal share at this point but remember there are more people in general society that need those profits. Society as a whole doesn't not rejoyce or benefit with one person recieving that excessive income. Please let me know what you think. Feel free to email me a_magaro01@comcast.net ~~fbody

It seems to me that the "fundamental principle" of 'Socialism' (including Market-Socialism) can be derived either historically or by the word itself, or better both. Social-ism, implies that the highest principle of society should be "to be social." That then can be taken in various ways (by English language), such as (perhaps mainly): 1. to be a kind and considerate warm hearted person / society who cares for the poor and those who are hurting, or 2. to enjoy togetherness with others, to interact and to do things together. One may ask to what extend these two sides stand apart. To help with the analyses we can add history into the mix: when did those using the word come about, what did they protest, what did they want. The socialist labor movement roughly came into being from 1850, and was a reaction to the repression of the workforce by the "Capitalist" factory owners and financiers. The propaganda that the workforce was attacked with claimed that the Capitalist owners had every right to abuse the people as much as they did, because "it was the market principle," and they where just better at it (etc). We also have a certain pressure from eugenics and Fascism, who outright claim that might makes right. If we then contrast these two broad movements: those claiming that they had the right to abuse the workforce because some sort of ideological theory, such as the market, or such as they are being the more violent and stronger who should rule over the weak and eventually replace them (eugenics), then get a reply from "the socialists," who seem to claim "we will not accept *any* claim to whatever theory or logic, to justify the abuse and exploitation of people; we demand a 'social' kind of society." You then see the socialists getting into every way that the suffering of the workforce could be limited, and that then leads to the development of many ideologies, or perhaps it is better to say that the socialists joined the search for a better system of society (etc), which then leads to ideas like: should the whole economy be under the State, or should we have co-operatives, and so on.
This kind of definition is somewhat unworkable from an analytical or academic (systemization) perspective, because there are many movements which claim to deliver or work toward a more 'social' society (with more kindness and peace, etc). However it seems to me that it would be a better definition to see it that way, firstly because it is in the name, secondly because broadly the common adherents to the 'socialist' worker movement have had such feelings and ideas which often where not crystalized out into how exactly the State should function with respect to the economy which leads to fourthly: back in the days of 1850-1930 or so, there was a lot of overlap between all these movements, which can even be seen as various wings of broadly the same labor class movement. To make clean cuts like "Socialism wants everything under the State, and Anarchy wants a participatory localized and voluntary association without a State" would be ideal to create a puzzle of cleanly delineated movements, but it seems to me it would not be the reality of the situation. The definition is vague, the movement itself is and was vague as well (on many if not almost all of the major issues). — Preceding unsigned comment added by Jos Boersema (talk • contribs) 17:04, 12 October 2018 (UTC)[reply]

Oscar Lange[edit]

I assume this is Oskar R. Lange? There were only two choices on the disambiguation page. I am not aware of how Lange's On the Economic Theory of Socialism (1936) predates Proudhon's General Idea of the Revolution in the 19th Century (1851). Admittedly these are two very different approaches ... Jacob Haller 04:28, 23 February 2007 (UTC)[reply]

That's him. Proudhon is not market socialism. Working Poor 04:31, 23 February 2007 (UTC)[reply]
You stated in that the means of production are owned individually in mutaulism which you claim is market socialism. How is that different from capitalism, since the means of production can be owned individually as well? Also you didn't give a source. Working Poor 04:36, 23 February 2007 (UTC)[reply]
Mutualism (economic theory) has historically been considered part of socialism. First, because many mutualists (including Proudhon, Greene, and Tucker) were active in the socialist movement; second, because mutualists favored workers' ownership of the means of production. Those working alone would own their tools as individuals; those working together would own their tools as a group. The opposition was between workers' ownership and boss ownership, not between collective ownership and individual ownership. Jacob Haller 05:01, 23 February 2007 (UTC)[reply]
I still don't see how that is different from capitalism. In the U.S. are individually owned business and there are employee owned businesses who all share ownership in the business. No one would say the U.S. has a socialist economic system. In socialism there is social ownership meaning society as a whole would control the means of production, not small groups of collectively owned businesses that are not under social control. Working Poor 05:05, 23 February 2007 (UTC)[reply]
Capitalists like to say that private ownership of the means of production is a sufficient condition for capitalism, and some partisans of communism like to conflate capitalism and commerce. But the original critique of capitalism was as a system where mere ownership of capital allowed individuals to command labor without laboring themselves. Worker control of the means of production does not necessarily mean collective control. It seems fairly arbitrary to write the Ricardian Socialists and mutualists out of the history. Libertatia 21:44, 24 February 2007 (UTC)[reply]

Mutualism[edit]

Benjamin Tucker writes (State Socialism and Anarchism):

For these and other reasons Proudhon and Warren found themselves unable to sanction any such plan as the seizure of capital by society. But, though opposed to socializing the ownership of capital, they aimed nevertheless to socialize its effects by making its use beneficial to all instead of a means of impoverishing the many to enrich the few.

—The preceding unsigned comment was added by Jacob Haller (talk • contribs) 05:27, 23 February 2007 (UTC).[reply]

"Opposed to socializing the ownership of capital," therefore it's not socialism. Socialism socializes the ownership of capital. Working Poor 05:37, 23 February 2007 (UTC)[reply]
Tucker described his views as socialism. (in SS&A).
Edwards (Introduction to the Selected Writings of Pierre-Joseph Proudhon, p. 18) writes that:

Marx had been greatly impressed by Proudhon's earlier work, What is Property, and he considered that Proudhon was one of the first "scientific socialist" writers.

Even if mutualism does not meet your definition of socialism, mutualism and other classless market systems are relevant to market socialism. Jacob Haller 06:00, 23 February 2007 (UTC)[reply]
It's not my definition of socialism. It's the definition of socialism. Maybe mutualism is relevant but I don't see how. If a source calls it market socialism, then by all means put it in the article if you have sources but understand that that would be a minority point of view. Therefore it couldnt be represented as consistent with the normal definition of market socialism. Working Poor 06:06, 23 February 2007 (UTC)[reply]
Ben Tucker, Armies that Overlap, defines socialism as:

Socialism is the belief that the next important step in progress is a change in man's environment of an economic character that shall include the abolition of every privilege whereby the holder of wealth acquires an anti-social power to compel tribute.

I doubt not that this definition can be much improved, and suggestions looking to that end will be interesting; but it is at least an attempt to cover all the forms of protest against the existing usurious economic system. I have always considered myself a member of the great body of Socialists, and I object to being read out of it or defined out of it by General Walker, Mr. Pentecost, or anybody else, simply because I am not a follower of Karl Marx.

Robert Graham, The General Idea of Proudhon's Revolution, states that:

Proudhon’s attempt to meld capitalist market mechanisms with socialist economics is beset with seemingly insuperable difficulties. Yet, flawed as Proudhon’s economic proposals may be, the general idea underlying them cannot be dismissed out of hand. Proudhon’s central insight is that there can be ‘exchange without exploitation.’[48] Today he can be seen as one of the originators of market socialism, a libertarian alternative to both capitalism and state socialism. Ironically, the most interesting work in this area is now being done by Marxist revisionists. While accepting Marx’s critique of capitalism, they have rejected his communist ideal as economically unsound and politically authoritarian, a view shared by Proudhon.

Market socialism is but one of the ideas defended by Proudhon which is both timely and controversial.[62] Many socialists still regard market mechanisms as irrational and unjust, while state socialist societies try to graft elements of a competitive market economy onto their bureaucratic and authoritarian political structures. Proudhon insisted that market mechanisms will only yield beneficial results if accompanied by anti-authoritarian forms of social organization. Proudhon’s market socialism is indissolubly linked with his notions of industrial democracy and workers’ self-management. It is because this kind of socialism has yet to be achieved that it remains relevant, both as an ideal to work towards and as a critical standard by which to evaluate existing regimes. Proudhon’s related critique of Jacobinism also retains its relevance in so far as various elements of the left remain committed to authoritarian political strategies.

Kevin Carson, in the preface to Studies in Mutualist Political Economy:

We hope this work will go at least part of the way to providing a new theoretical and practical foundation for free market socialist economics.

Kevin Carson, in the introduction:

Although their work preceded that of Pareto, and they did not use such terms, free market socialists like Hodgskin and Tucker were quite familiar with the substance of Pareto-optimality and the zero-sum transaction. In an order of free and voluntary exchange, all transactions are mutually beneficial to both parties. It is only when force enters the picture that one party benefits at the expense of the other. Indeed, the use of force necessarily implies exploitation, since by definition force is used only to compel one party or the other to do something other than he would otherwise have done, were he free to maximize his utilities in the way he saw fit.

An Anarchist FAQ A.4.2

Like Proudhon, Mill was a forerunner of modern-day market socialism and a firm supporter of decentralisation and social participation.

A.4.3

It would also be worthwhile to mention those market socialists who, like anarchists, base their socialism on workers' self-management. Rejecting central planning, they have turned back to the ideas of industrial democracy and market socialism advocated by the likes of Proudhon (although, coming from a Marxist background, they generally fail to mention the link which their central-planning foes stress).

So here two mutualists describe themselves as socialists and another author describes Proudhon as a socialist. Jacob Haller 06:56, 23 February 2007 (UTC)[reply]
Ok, but these people are outliers coming up with their own very unorthodox definitions of socialism. You can't rewrite the definition of market socialism in this article or the definition of socialism in the socialism article to make room for such a minority point of view that contradicts mainstream definitions of socialism. Like I said, go ahead and put it in somewhere, as long as it's not represented as the mainstream view that socialism can have either socialized or individualized ownership. Working Poor 07:17, 23 February 2007 (UTC)[reply]
Wow. I'm used to the capitalist editors enforcing very narrow definitions of socialism, because they don't have much respect for the actual history of the socialist tradition. I'm curious who gets to set the "mainstream definition," since the historical record is clear as to the range of "socialisms" that have co-existed within the labor and reform movements. Libertatia 17:36, 23 February 2007 (UTC)[reply]

Who's on first?[edit]

I have run across references to Ricardo, Hodgskin, et al. proposing socialist market systems in the 1830s. (Carson, SMPE, various places). Hodgeskin wrote The Natural and Artificial Right of Property Contrasted in 1832; Proudhon wrote What is Property? in 1840 and General Idea of the Revolution in the 19th Century in 1851.

So there were two interrelated socialist market systems (that of Ricardo, Hodgskin, et al., and that of Proudhon, Greene, et al.) by the middle of the 19th century; both were sharply critical of capitalism, both were committed to workers' liberation, and both were influential in the development of the other schools of socialism (including Marxism and [socialist] anarchism).

Within Marxism, NEP was 1921, before 1936. Jacob Haller 21:03, 24 February 2007 (UTC)[reply]

It is really entertaining to read petty bourgeois folks about what's cooking in their petty bourgeois minds! —Preceding unsigned comment added by 68.146.254.93 (talk) 23:34, 11 October 2007 (UTC)[reply]

So does it work?[edit]

This article seems curiously devoid of any mention of the results of various attempts to put market socialist theories into practice. Is there any objection to adding a more practical section attacking the problem of whether market socialism is something akin to phrenology or if there is some value in applying these theories? TMLutas (talk) 21:52, 23 June 2008 (UTC)[reply]

Section dump[edit]

Dumping short section I'd previously tagged. Having reread it several times since, it's just blatant POV and probably not salvageable:

BEGIN

Practical implementation results[edit]

Market socialism where it has been tried, has given intermediate results between actual capitalism and more pure socialist variants such as Bolshevik war communism. Actual applied economic performance is sub-par but it does not fail as quickly as more radical and pure communist variants.

END

"free market socialism" -- do "proponents" use this term?[edit]

I've reworded a bit with a recent edit, because I think most "proponents" of "free market socialism" as described here would sooner call themselves "anarchists" or "mutualists" than "free market socialists". I found some formal works using the term, and have cited one, but the author of it doesn't seem to be a "proponent". In general, the use of this term seems sparse in the literature, and not necessarily used mainly by "proponents". Yakushima (talk) 06:12, 22 August 2009 (UTC)[reply]

Hello. Since I am a proponent of 'market socialism,' serious enough about it to make it my life's main work, and given the lack of even one example of such in above question, perhaps my opinion on it could be helpful (?). In the version of 'market socialism' I would like to see done, the market is truly free. There is freedom of initiative to start business, freedom to trade, to make contracts, to rent and rent out your soil at will, to set prices, and so on. The market will be more free than it can be under "Capitalism," in which power centralizes and people are pressed in a corner to then sell their labor for much less than it is worth to the owning class. As such it seems to fit the 'far end' of market-socialism (as described on the page currently) with a free market, as opposed to one that is not so free, and hence the model I would prefer might qualify for the name "free market socialism," as the page suggests. Indeed I find that a perfectly acceptable term, which I have used sometimes, but not often. The reason not to use it above "market socialism" is only because it is longer, and in my opinion the term "market" already should contain the necessary freedoms to set prices, make contracts, have initiative, etc. Technically speaking "free market socialism" might be superior, to differentiate from semi-market systems with arbitrary price controls or restricted individual freedom, and to stress that the market operation to find prices which dynamically adjust themselves to more or less fair value (which is how markets are generally understood to operate) is a key component of the system.
I belief that '(free) market socialism' should reject the Marxist principle 'from all according to their ability, to all according to their needs,' (which is admirable personal moral behavior and certainly fit for a family and within a co-operative business, but not enforcible on the grand scale of society) and substitute: to all according to their work (as achieved in the market), and (taxation) from all equally. This to stress that the market truly should be their own free-running system, which will have people who are more and less successful according to their effort and talent. It should however not get out of control, as it invariably does under Capitalism because it allows limitless accumulation of Capital. The exception can be made for cases falling under generalized insurance for sickness, the young and the old. The market as such is a social achievement, a trade is a free agreement to two persons, who overcome mutual violence by the procedure. Hence I agree with the page to call certain forms of market socialism "free market socialism." I would *never* want to refer to a system of what I think society should look like as "anarchist," or "mutualist," even though in the most idealized and literal sense of those words that might be applicable. "Anarchy" as in 'a society of equals', could be applicable to a good society in a loose sense, however the anarchists push this to an extreme where judges, representative Government and police seem to become impossible. The direction of the anarchist movement is one that seems to stand strongly against objective and lasting structure and law. Even if that is not a necessity, in my experience that is what anarchists tend to champion. I find this a regrettable stance.
'Mutualism' is something unknown to me to be honest, but it sounds like an idea that goes into the anarchist direction. Reading up on 'mutualism' on the wiki, I would have to conclude that this is not compatible with what 'market socialism' should be (or in what general direction 'market socialism' should be formulated, in my opinion). I think that 'market socialism' should be embodied in a State under the Law (Constitution), which suppresses out of existence certain undesirable economic behaviors, such as the limitless accumulation of wealth and investment for profit in dictatorial enterprises, as well as others such as the phenomenon of the State debt. One law for all is a most important historical achievement against tyranny. I cannot conceive of any ideology capable of maintaining itself (for the humanity we have), without making law and having a method of enforcing it, including anarchy or mutualism (which might require a return to the stone age to function and be stable, which seems to be a rather drastic and unpleasant step for humanity). I personally might find the expected chaos and misery under 'anarchy' with its utopian expectation of human behavior to be a worse prospect than both modern wild west Capitalism or historical repressive "Communist" regimes. (Sorry for going on about it; if this pains someone, please feel free to cut it down to for example: "As a proponent of market-socialism, I feel quite comfortable with the term 'free market socialism' but not with 'anarchy' or 'mutualism.') Jos Boersema (talk) 20:05, 20 November 2018 (UTC)[reply]

Market Socialism: public AND cooperative ownership[edit]

Cooperative ownership is not public ownership, it is private. Many marksoc systems proposed are based on cooperative ownership, which is not public, since a (producers´) cooperative is owned by the workers of the coop company. I want to add the word "cooperatively" to the main definition of marksoc in the article. Please, discuss. — Preceding unsigned comment added by 186.63.20.232 (talk) 16:49, 3 September 2011 (UTC) hehe, due to wording, this previous comment is very probably mine, yep, the same Horzer of years ago (Pablo Podhorzer). I really like this "Market Socialism" article and how has it been shaped by no doubt dozens or more collaborators. Good job everybody![reply]

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Market Socialism with free soil by right[edit]

Hello talk page,

I should caution first that I am the author of a version of what I loosely call 'market socialism', or 'Distributism'. I hope it is OK I write something here, just on the talk page ? The system I have developed does not seem to be covered (yet) by its main characteristics. Obviously I will not edit the main page, but perhaps there are people editing this page that find it interesting.

I think that economic general theory as currently thought is being superficial, because it is taught that *effort* creates market value (I will not go into the why of that here), which is correct. However the natural resources in their raw form are *not* the product of human effort. They do however constitute power points for those able to centralize their control. My conclusion is therefore that natural resources do not belong in a market, or at least not a market where ownership (as in total and ever lasting control) can move between people, and imply that some will own much or even everything while others own little or even nothing. The natural resources are the starting point of all work. It should therefore be available for all. However once the natural resources (loosely "the soil") has been distributed, you can (and I think should) have rental markets upon that bases, as well as swap markets. Thus the benefit of markets in natural resources is retained, without the downsides of creating a landless and therefore powerless under class, who will slowly degenerate in every way, and through their degeneration become beholden to a ruling class. They become a class of serfs and canon fodder, unable through their generational slavery to see a way out. This part of the system would be the economics for the individual.

I'll try to be brief: economics for the group (business, group production) should try to avoid getting bogged down under business dictators, without destroying the ability of people to enter the markets as individuals, or to contract labor, thus becoming a business dictator. It seems wise to me that when the business starter leaves, the business will - when large enough - be forced by law to become co-operatively owned by the workforce. Then above that is the generalized economics (for the whole Nation), and on that front I belief that we need to stop the effect of for-profit business finance which seems it is most profitable where labor is abused (see what creates wealth above: effort, work the slaves harder and you are competitive in the markets). Hence investment credit needs to be mostly chocked off. Although it will become difficult to be extremely rich and lazy in this system, I would think it also wise to have a quite high private wealth maximum, since we cannot allow one person to own everything (which would be an absolute King). Such a measure is an anti-monopoly / cartel law with teeth. Furthermore business size should mostly be kept below 2000 full time workers as well, to keep the market open and dynamic. This should be coupled with a high end democratic system, more reliable than Parliament.

I worked it all out in a 673 pages thick English book, which is 100% free PDF and source, all in the public domain, so I absolutely care nothing for any sort of profit and only for spreading correct economic ideas. My website is called: market. socialism. nl I hope it is OK that I point to that here ? There is a rather large amount of detail involved, which is impossible to put here. This is only a very short introduction, and does not even get into the reform / revolutionary model attached to it, or other facets like software. I chose the name 'market socialism' because I was rather lost on how to describe it, and this seemed to come closest. Sometimes I think Distributism could be better, however that has its own problems like "do you want to distribute wealth" (no). There are problems with any name, and market-socialism more or less seems to contradict. I do not use "free market socialism" because it is needlessly complicated, and 'free market' carries connotations of international free trade zones, which is not what this is about. There is no central planning board in the system as I propose it, just a normal Government role with separation of powers.

One last point: the system described in the Torah (Jewish holy book) is broadly similar to the system as I describe it: free land for all, and strong control against for profit finance. Native Injuns of America also understand that land does not belong in a market system. In the past when there probably was trade in other items, but no farming yet, the land was presumably mostly open for all. Please don't be mad I write this here if it is not ok, thanks. — Preceding unsigned comment added by Jos Boersema (talk • contribs) 16:30, 12 October 2018 (UTC)[reply]

Zero Sources in this section[edit]

https://en.wikipedia.org/wiki/Market_socialism#Marxism%E2%80%93Leninism There are no sources in this section, if we don't back up these claims they could be removed. --― TaltosKieronTalk 13:06, 24 August 2021 (UTC)[reply]

Belarus[edit]

How is Belarus a market socialist economy? The source for that claim doesn't explaing what do they mean by Belarus having a market socialist economy. It only states that it has a large state involvement nothing about collective ownership of the means of production etc it just calls it "market socialism" for no apparent reason (I suspect that if there is a reason for this claim it's political but I can only guess). Similarlly the source for the claim about ethiopia only doesn't even mention socialism.

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