market economy

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Market Economy

A social and economic system in which prices are fixed by the law of supply and demand rather than by a government or other body. In its pure form, a market economy is an economy absent of government subsidies, incentives, or regulations. A market economy contrasts with both a planned economy and a mixed economy. No economy is a complete market economy: most countries claiming to have market economies in fact have a market economy combined with greater or lesser government regulation, sometimes called a social market. Proponents of a market economy argue that it is more efficient than any alternatives, promotes fair competition between its participants, and rewards skill and hard work. Critics allege that a market economy perpetuates class differences and rewards ruthlessness over actual labor. Milton Friedman, Friedrich Hayek, and Ludwig von Mises were three major 20th-century proponents of the market economy. See also: Capitalism, socialism, John Maynard Keynes.

market economy

see PRIVATE-ENTERPRISE ECONOMY.
References in periodicals archive ?
Best Practice Guidance | Agency Compensation: Market-Based Labor Rates position paper : The position paper contains guidance for agencies to streamline the process of establishing and evaluating their labor billing rates.
To test this, I ran some simple forecasting models that tried to predict core PCE inflation 12, 24, and 36 months ahead using lags (or past values) of either the core PCE or the market-based core PCE.
This said, however, the American university system is far from a pure competitive market-based system, and the modern history of universities suggests that blindly emulating them at the K-12 levels has the real probability of creating severe problems.
Our human capital demands today require a fresh approach that meets President Bush's vision of a civil service that is citizen-centered, results oriented, and market-based.
It is a work of thorough scholarship that will challenge social policy critics of market-based welfare to more rigorously address the arguments of rational choice theorists and come to grips with the very complex issues they raise.
Rebuilding the country's physical infrastructure and transforming its economy into a market-based system is going to be very expensive.
In our market-based economy, the primary mechanism that regulates firms' risk-taking is the discipline provided by creditors and counterparties.
It is important for all parties to understand that the problem is not with a market-based approach, per se.
The Standard establishes a market-based approach that will enable the state to achieve increasingly demanding tiered targets in energy efficiency, demand-side resources and conservation through 2010.
While adding capacity is always an airport's first preference, we believe market-based approaches have significant roles to play where capacity is constrained in the short or long- term.
Department of Transportation (DOT) today published a request for public comment on the feasibility and effectiveness of using market-based approaches to relieve airport congestion and flight delays.
Between now and January 1, 2007, all major electric utilities in upstate New York will begin transitioning their larger commercial and industrial customers to hourly market-based pricing, exposing all businesses in the region to fluctuating rates and price uncertainty.