Market socialism
As competition socialism (also called market socialism ) refers to economic models which represent an alternative to a pure planned economy. They are also referred to as a "third way" between capitalism and socialism.
The competition socialism model of Lange and Lerner
After inter alia, Ludwig von Mises exposed the theoretical shortcomings of a pure command economy, the competition socialism by Oskar Lange and Abba Lerner P. has been developed.
The model revolves around offering products at cost price and to socialize businesses. The state occurs as an organ directing investment, while the target of the quantities according to the actual demand.
What basic assumptions meets Oskar Lange?
In socialist society model by Oskar Lange ownership of all means of production (except the work force) in public. For production goods ( and capital goods) therefore there is no market, and in place of a variable market price enters fixed price accounting. Individuals are consequently not only as consumers and employees in the economic system in part, but also as owners / producers. You report income under the terms of labor costs and a social dividend. What started as a ' corporate accumulation ' (total capital and natural resources in a society ) will be credited in this regard, Oskar Lange leaves.
It is also assumed that freedom of choice apply in the consumer goods market and the labor market and that consumer preferences can be mapped via the demand price / should. This demand price (price for a consumer ) is the main criterion for the allocation of resources and the production process. The goal is the set of product and cost prices to find and to determine at which the quantity demanded corresponds to each economic good of the bid amount - the equilibrium price.
Oskar Lange examined to the systemic conditions of rational allocation of resources ( proper distribution of consumer goods and assigning different economic activities ) and the guiding principles of efficient production of economic goods.
What role do state, market and society and how should the competitive socialist society work?
In the socialist economic model by Oskar Lange exist the Central Planing Board ( CPB) and the individuals in the roles as consumers, employed and producers / owners.
The authoritarian administrators in CPB have to follow the preferences of the consumers and to set the right price for capital goods and other means of production (excluding labor ). The theoretical price of the CPB is specified outside the market ( consumer goods and labor market) and reflects the conditions under which alternatives ( opportunity cost: leisure, safety, health, etc. ) are offered. The market (consumer and labor market ) function now is to provide a method of resource allocation and production processes by trial & error. About more production and demand periods of time, can finally find the equilibrium price or determined by balancing demand quantities and amounts.
The workers offer their performance of the industry / factory, which pays the highest wages. (And the prices are fixed in the industry / factory for capital goods and other means of production. )
Consumers have next to a working wage ( market price taking into account the opportunity costs) over a given social dividend ( accounting price determined by CPB). You know the price given in the consumer market (market price was based on the history) and want / should get the maximum benefit of its output, making the demand quantity of the consumption good is determined.
The producers / owners do not follow under the provisions of the CPB ( accounting price for the costs of factors of production and market price for the prices of consumer goods ) the objective of profit maximization, but the the best possible satisfaction of consumer preferences. Their function is to achieve the minimum average cost of production by the combination of production factors and the output quantity is.
Formal theory according to Oskar Lange considered is the distribution of resources in the "competitive socialism " just like in the competition regime of private entrepreneurs on the ' scientific technique of economic equilibrium theory ' instead, so right. Adequate - practically evaluated according to Oskar Lange, the production process is more rational and more efficient. Rational because he produced in an adequate system of economic calculations a price that all alternatives (opportunity costs: including leisure, safety, health) factored and more efficient because it allows the distribution of income maximum social welfare ( welfare ).
The competition socialism model of Austro-Marxism
The Austrian Social-Democratic Labour Party developed in the period of Austro-Marxism an elaborate transformation model with which they wanted to achieve the transition from capitalism to a socialist form of society. In this public service broadcasters ( GWA ) should serve as basic units.
Unlike the case of the centrally planned economy of the USSR and other Eastern bloc countries should not be overcome, the market economy, but transferred to the industry under public ownership and managed democratically, while maintaining the market economy framework.
Patterns of organization
It was intended that the industry of Austria should be reorganized in comprehensive socialization measures in public service institutions and summarized in democratically managed trusts.
To this end, an operational holding company was set up in the form of a GWA provided at the state level for each industrial sector, which should offer through its subsidiaries and cooperation with enterprises of the cities and municipalities in the assigned area of goods or services. The direct participation of employees in the establishment meeting was planned to be built in a holding company of the Group Works.
The GWA should be nationwide connected according to their activity on the principle of vertical concentration pursuant to § 11 of the Law on public service companies on the posting of officials in the institution meeting each other's company, that is, there should be a network between the upstream and downstream stages of production ( for example, coal mining and steel production ) of all socialized SMEs.
In addition, all public service holding companies should be required by law together to form a trade association, which should act as the political voice of the socialized industries and as a bargaining partner of the trade unions. These should be divided into regional associations and a Federal Association as an umbrella organization.
SMEs and cooperatives
Small and medium enterprises and cooperatives should be excluded from the socialization, since only the " exploitation ownership " of the bourgeoisie must be set aside and the technical development had not progressed far enough to even be able to manage them efficiently enough.