Types of economic systems and their criteria

Mankind in its difficult history has already “experienced” quite a lot of different economic systems. This gives grounds to raise the question of their classification. Classification in science is always a complex matter. Its success, scientific validity largely depends on the correctly selected “key”. Such a “key” is the criterion of separation, i.e. its main feature, the “touchstone” or yardstick. The scientific nature of the classification depends on the correct allocation of the criterion (or criteria).

In modern economic science, different criteria are used when considering the types of economic systems. The main ones are the following:

the dominant form of management; basic forms of ownership; a way of coordinating economic actors and actions; the way income is distributed; type of state intervention in the economy; inclusion of the economy in world economic relations.

Since there are many criteria, which means that there are many criterion approaches to classification, there will be several classifications themselves.

Consider them in the following order.

The first classification connects the allocation of types of economic systems with the dominant form of management. With this approach, the following are distinguished: an economic system with a natural form of management; economic system with a commodity form of management. According to another criterion – “the main form of ownership” – economic systems are distinguished: communal type; privately owned type; cooperative-social type; Mixed. According to the criterion “mechanism (method) of coordination of actions of economic entities”, the following types of economic systems can be distinguished: traditional; market; planned. The “prevailing mode of income distribution” as a criterion approach to economic systems allows us to distinguish the following types: communal-equalizing; with the distribution of income by land; with the distribution of income by factors of production (by land, by capital, by labor); with a distribution by quantity, quality and effectiveness of labor contribution. “The boundary and type of state intervention in the economy” as a criterion divides economic systems into the following types: free, liberal; administrative-command; economically regulated; mixed. According to the criterion of “the degree of involvement in world economic relations and relations”, economic systems are distinguished as: closed; Open. Finally, according to the criterion of the degree of maturity, economic systems can be distinguished as: emerging; mature, developed; degrading.

In the modern economic literature of the West, especially in popular textbooks, for example, C.R. McConnell and S.L. Brew, the classification is reduced to a distinction between three main types of economic systems:

1) traditional economic system;

2) market economy;

3) command economy.

The traditional economic system is usually understood as an economy based on traditions and customs fixed in the economic consciousness of people on the basis of the experience of generations. As a rule, this is a subsistence economy, serving itself at the expense of its own resources and forces, which has a closed character.

The market type of economy is interpreted as such an economic system in which, on the basis of private property, the movement of production resources and production itself is carried out under the influence of a market regulatory mechanism based on fluctuations in demand, supply and prices, as well as on economic benefit.

The planned (command) economy is defined as its type in which social property dominates, commodity-money relations are of a formal nature, and the movement of production resources and production itself is determined by the administrative center on the basis of a system of plans and commands.

It should be noted that such a classification, although it is the most common in the modern literature, has a certain scientific limitation. Firstly, because it is based on different, multi-system criteria of the typology of economic systems. Thus, traditional and market types are distinguished on the basis of the criterion “mechanism for coordinating the actions of economic entities” (either traditions or market forces), and when allocating the third type – “planned (command) economy” – a different criterion approach was used – from the standpoint of the degree and method of state intervention in the economy. Secondly, the criterion of ownership is also used inconsistently: in two types – market and command – it plays a certain role in the typology (private and public property are opposed), and in the characteristic of the traditional type of economy there is no economy at all. Even such logical defects of this typology limit its scientific significance.

Overcoming to some extent the limitations of this classification, modern economic thought distinguishes another type of economy – a mixed economy. It is characterized by the stable presence of elements of different types of economic systems. It is this type of economy that represents a number of modern Western European countries. This type has objective prerequisites. Thus, the market mechanism alone in modern life does not provide effective and sustainable self-regulation of the economic system, but leads to a certain deregulation of the economy (crises, unemployment, inflation). The way out is found in a certain integration of regulatory mechanisms – market and state. In this respect, the economic system is also becoming mixed.

The main difference between the mixed type of economy is its diversity. The main features of this type are:

the combination of the private and public sectors of the economy; combination of market and state regulatory mechanisms; combination of privately owned market motivation with the motivation of social stability in society.

A mixed economy can be considered a special type of economic system. This is due to its integrity, stability, ability to self-renewal, a certain compatibility of the components of the system. And these are all properties inherent in every type of economic system. But it is really necessary to distinguish between the mixed economy of developed countries and the mixed economy of developing countries. These are the types of mixed economy.