From Marx to the Market: Socialism in Search of an Economic System

From Marx to the Market: Socialism in Search of an Economic System

Wlodzimierz Brus

Language: English

Pages: 192

ISBN: 0198283997

Format: PDF / Kindle (mobi) / ePub

Distinguished economists Brus and Laski--who were involved with the Planning Office of the Polish economy in the 1950s and 1960s--here develop a theoretical system of economic management which avoids the failings of both market capitalism and central planning. This book examines Marxists claim to socialism's economic rationality and studies the application of the concept in the "real socialism" of Communist party orthodoxy as well as in the tentative attempts at "market socialism", particularly in Hungary and Yugoslavia. The analysis focuses on general features of the evolution of the socialist economic system, but national experiences are used to point out the advances that have been made and the flaws in the theoretical models that have been developed.

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the construction of socialism they display basic similarities in what may be understood broadly as the underlying development strategy. Because of its link with the process of transition to socialism under conditions of immaturity, and because of the fact that it was pursued in all countries of 'real socialism' in some phase of their development, this strategy may be called socialist or communist modernization strategy. It should be remembered however that it emerged first in the USSR in the

regard to consumer goods where fashion is of significance. (Here again the direct and indirect impact of the wider scope for non-state activity ought to be kept in mind.) However, all these necessary qualifications notwithstanding, it is indisputable that two decades of operation of the NEM (we stick to the designation of New Economic Mechanism, which has become a generic term despite its loss of novelty) have failed to produce the breakthrough which the reformers expected. Moreover, with the

policy objectives aiming at raising the level of welfare of the society, denned in a comprehensible and widely accepted way. This is the foundation of the concept used by Kornai in the last chapter of his Economics of Shortage—paternalism, which as a matter of principle props up a family member in difficulties.13 Granick points in the same direction, but tries to be more specific by indicating as the main obstacle to market coordination the 'microeconomic full employment constraint' (life time

declare that the present writers share the fundamental elements of the Keynes-Kalecki approach to problems of economic dynamics; the analysis which follows will use this approach. The feature which MS shares with capitalism is the position of the enterprise (firm). The firm in MS has to be motivated exclusively by short- and long-run profits, as well as by an increase in the value of its assets. It has to be financially fully responsible for its activities and to act in a competitive environment

cumulatively. This process is influenced by changes in the utilization of capacity and by changes in its size. With growing aggregate output, the degree of utilization of capacity grows, creating new stimuli for investment necessary to adjust capacity to an expanding aggregate output. Behind this development lies the well-known acceleration principle. On the other hand, the growth of investment and subsequently of the productive capacity itself creates a countertendency to the increasing degree

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