4. The relationship between the functions of the state and the market in a transition economy

One of the main conditions for the transition to a market economy is a change in the role of the state as a regulator of economic processes. In a planned economy, public administration played a decisive role in determining all economic proportions, while in a market economy the main regulator of economic proportions is the market. Therefore, during the transition period, on the one hand, there is a decrease in the degree of state intervention in the economy and state regulation of economic processes loses its comprehensive nature. On the other hand, forms and methods are changing government regulation, because the previous ones, which developed in the era of totalitarianism, are unsuitable for regulating the economy in the transition period.

However, in a transition economy the role of government regulation is more significant than in an established market economy. In the formed market system, the state only maintains the aura for economic development. In countries that have just embarked on the path of forming market systems, the market is in its infancy, its regulatory capabilities are not yet high enough.

Two groups of regulatory functions of the state can be distinguished. Firstly, a group of functions to create conditions for efficient operation of the market. Secondly, these are functions to supplement and adjust the actions of market regulators themselves.

The first group includes the function of providing a legal framework and creating general legal conditions for the economic activities of business entities, as well as the function of stimulating and protecting competition as the main driving force in the market environment.

The second group includes the functions of regulating distribution processes and redistributing income, adjusting the results of market processes, ensuring economic stability and stimulating economic growth. These functions are inherent in both transition and developed market economies.

The state plays an important role in stimulating and protecting competition. Due to the underdevelopment of competition and the extremely high level of market monopolization characteristic of the economy transition period the implementation of this function is of particular importance.

The transition to a market economy is accompanied by a sharp increase in the differentiation of incomes of different segments of the population.

In those areas where the market is unable to fully satisfy social needs, in particular in “public goods,” the state takes on this function. State intervention here is of an auxiliary nature and is intended to guarantee the necessary supply of goods that, for one reason or another, are not produced by the market or are produced insufficiently, for example, educational services.

5. Models of a transition economy.

5.1. Gradualism.

In the theory and practice of market reforms, two opposing concepts have emerged. One of them is called “gradualism” (from the English word “gradual” - gradual), and the second is “shock therapy”. The expression “shock therapy” is borrowed from medicine and is not a strict scientific term for economic processes. However, it aptly describes characteristic features radical market transformations and is therefore widely used in economic literature.

Gradualism is an economic concept that involves slow, gradual reforms and gives the state a major role in shaping the market. Proponents of this concept believe that in order to create a market, the state must gradually replace elements of the command-administrative economy with market relations. According to gradualists, this will soften the processes of transformation and avoid a sharp decline in production and living standards of the population.

A striking example of gradualism is the reforms in China. Although this country belongs to the post-totalitarian type, the Chinese experience is so successful that it can serve as a role model in post-socialist states.

Since the beginning of the 80s. China manages to maintain high rates of development, approximately 10% GDP growth per year. China has already entered the top ten leading countries in the world and in the coming years may catch up with the advanced countries of the West.

The Chinese leadership takes an extremely pragmatic approach. It encourages markets where possible and maintains government control where it deems necessary. Political stability, the ability to create favorable conditions for entrepreneurship, combined with cheap labor, attract foreign capital to China, which has invested more than $300 billion here over the years of reforms. This is fifteen to ten times the accumulated volume of foreign investment in the Republic of Belarus. A very successful solution was the creation of free economic zones in the coastal provinces of China, where foreigners open new production facilities using Chinese raw materials, materials and labor on preferential terms.

At the same time, heavy industry, which is much more difficult to transfer to a market economy, remains state-owned. By carrying out gradual reform of state-owned enterprises, for example, by allowing them to issue shares, the government at the same time prevents their collapse and maintains budget funding. Chinese experts admit that unprofitable and slow-moving heavy industry enterprises will not become competitive and will have to be closed in the foreseeable future. However, they believe that the state should subsidize them whenever possible so that the crisis in heavy industry does not entail dangerous economic and social consequences.

The Chinese experience certainly deserves attention. Its value lies primarily in the fact that the Chinese leadership manages to combine reforms with rapid economic growth. It is always difficult to achieve such a combination, because during the period of reforms, the “readjustment” of economic mechanisms usually leads to disruptions in the operation of enterprises.

The success of China's transformation is crucially linked to the presence of a huge layer of small entrepreneurs in both city and countryside. Removal of restrictions on individual labor activity in the early 80s. allowed in very short terms revive trade, agriculture and small-scale production. In turn, this gave impetus to larger business structures with capital to further expand the business. The attraction of foreign capital and the commercialization of state-owned enterprises played a major role.

It is not difficult to see that Chinese reforms are being carried out in favorable conditions of political stability, when the state has the opportunity to enforce its decisions. What are the reasons for this stability that distinguish the reforms in China from the reforms in the Republic of Belarus? Firstly, in China there is no movement towards political democracy and the associated clash of interests and opinions, and the power of the Communist Party remains. Secondly, thanks to the national and cultural homogeneity of society, China almost does not face the problems of national separatism and contradictions between the Center and the regions. Obviously, this state of affairs is very different from the situation in the Republic of Belarus. Therefore, in our country, the Chinese experience as a whole cannot be reproduced, although some of its elements could be used here. Let us turn to the concept of “shock therapy”.

5.2. "Shock therapy"

The transition to a market economy raised the question of how to carry out market reforms. The sequence of measures taken, the composition of reform measures, etc., depend on its decision. Currently, in the practice of carrying out a course of reforms, there are two alternative paths: rapid radical reforms - “shock therapy” and a gradual, evolutionary transition. Let's consider the problem of “shock therapy”.

“Shock therapy” is an economic concept that considers instant price liberalization, a sharp reduction in government spending and achieving a deficit-free budget as a tool for market formation and anti-inflationary policy. It is based on the ideas of monetarism, a modern version of liberal market theory, which was developed by the American scientist, Nobel Prize winner Milton Friedman and his followers.

Monetarism assumes that the market is the most efficient form economic activity. The market is capable of self-organization. Therefore, monetarists argue that the transformations of the transition period should occur with minimal government participation. Indeed, as the theory of public choice shows, the state is not some abstract institution. It is led by specific people who are interested in maintaining their social status and therefore are not inclined to allow the economy to function autonomously.

Based on these considerations, monetarists place great emphasis on liberalizing the economy, believing that this will ensure self-organization of the market. In fact, the experience of transition economies confirms the thesis of neoclassical theory that economic entities (firms, entrepreneurs) in the course of market exchange create market norms and organizations (institutions) without any government intervention. For example, commodity exchanges and intermediary companies, many private companies and banks, as well as informal business codes arose solely on the initiative of entrepreneurs themselves. At the same time, modern theory speaks of the possibility of the emergence and sustainable existence of institutions that are detrimental to the economy, for example, criminal communities or inefficient forms of production and trade. In addition, self-development of the market based on liberalization requires a very long time. Therefore, liberalization is not enough; it must be supplemented by measures to support and develop market institutions from the state.

According to the monetarist doctrine, main task states in transition - maintaining sustainability financial system, because without stable monetary unit the market cannot exist. Therefore, the fight against inflation is the core of monetarism.

The government's financial policy during the period of “shock therapy” is aimed at ensuring the so-called hard budget constraints, which should replace the soft budget constraints characteristic of socialism. Strict budget restrictions mean that businesses can only spend what they earn themselves, without relying on receiving money from the government. As for the enormous hardships for the population from a sharp rise in the cost of living, monetarists believe that it is better to pass the period of high prices quickly than to drag out financial stabilization for many years.

In its most consistent form, this doctrine was implemented in Poland in 1990-1991. the first non-communist government led by Leszek Balcerowicz. The Polish leadership managed to suppress inflation in two to three years. Strengthening monetary system combined with the rapid development of the private sector and the influx of foreign investment, it allowed Poland to enter the stage of economic growth just three to four years after the start of “shock therapy”.

The short history of the transition economy shows that almost all post-socialist countries were guided to one degree or another by the doctrine of “shock therapy”. In some countries - for example, in Poland, the Czech Republic and Estonia - this experience was quite successful.

The choice that most countries with economies in transition make in favor of “shock therapy” is determined by objective factors. At the initial stage of the transition period, there are usually no conditions for gradual changes directed by the state. The monetary overhang, rapid inflation and the collapse of the economy during this period are accompanied by the collapse of the old government bodies, which makes the implementation of a consistent economic course hardly possible. Only a few countries that ensured a smooth transition from Soviet-style statehood to a new democratic state system or, on the contrary, like China, kept state institutions intact, were able to ensure consistency and gradualism of market transformations.

Summarizing the experience of the first years of reforms, scientists came to the conclusion that the choice of the concept of transformation largely depends on the initial state of affairs in the country. But with any option for carrying out reforms, the strength of state institutions is of great importance, i.e. the ability of the state, after the initial stage of the collapse of old governing bodies and the creation of new bodies, to achieve the implementation of the chosen economic policy.

This is true not only for the gradualist, but also for the liberal concept, the implementation of which requires painful reforms in the system of public spending, vigorous efforts to collect taxes, protection of property rights, countering the circulation of illegal means of payment (including foreign currency) and capital flight, fighting with corruption and other government actions. (Note that, contrary to popular belief, a liberal state is extremely tough and consistent in protecting the law and the rights of citizens; its liberal nature is manifested not in anarchy, but in non-interference in those areas of social and economic life where private initiative is preferable).

The “shock therapy” program offers the following package of measures:

1. Price and market reform (economic liberalization):

domestic price reform; liberalization of the distribution system; liberalization foreign trade; liberalization of the labor market and wage system; reform banking system and creation financial markets.

2. Development of the private sector - privatization:

small-scale privatization and private sector development; large-scale privatization; structural restructuring, liquidation of monopolies.

3. Reconsidering the role of the state:

restriction of state property rights; restriction of direct economic activities; strengthening the regulatory function in the social sphere.

4. Macroeconomic stabilization:

new fiscal policy, changes in the monetary system, legislative reform; institutional reform; social guarantees.

The first package of measures - measures to liberalize the economy are associated with the transition to competitive market relations and the corresponding price reform. At first, the introduction of free prices leads to an uncontrolled expansion of markets for goods and services, which, in turn, requires the demonopolization of trade and transport. A very important point in the complex of systemic transformations relates to the creation of markets for production factors: labor and financial resources.

The second package of measures involves reform and structural restructuring of production and enterprises. The first step in this direction is a clear formulation of state property rights and the division of functions of the state as a body as a whole. The implementation of privatization programs plays an important role. Securing private property rights and facilitating the creation of new private enterprises are critical. Production reform cannot be carried out without the liquidation of large monopolies, the relocation or dismissal of surplus labor, the cessation of unprofitable production, the repurposing and liquidation of enterprises.

The third package of measures requires a rethinking of the role of the state in the economy: it must abandon direct ownership and control of production and replace them with indirect regulation that would encourage economic adaptation and private economic activity. Another important task of the state is to reform the social security system and create a flexible system of social support to mitigate the consequences of unemployment, which will grow as the financial and economic crisis deepens. The State must establish an appropriate legal framework for collective bargaining and private sector activities and establish legislative institutions to ensure compliance with them. It is necessary to reform the main government institutions, including the central bank and tax departments, adjust budget items, and establish a control system.

The fourth package of measures - macroeconomic stabilization - involves tightening tax and credit policies towards enterprises, correcting various imbalances caused by "excess" money supply(i.e., the accumulated amount of money that there is simply nothing to spend on in conditions of shortage). As a result, equilibrium should occur in the market (primarily the consumer market), and the state budget will achieve balance. This will eliminate the inflationary potential in the form of excess money among the population and enterprises.

A program developed in detail can hardly be applied with equal success in different countries. The specific features of each individual farm will certainly affect both the course of transformation and the achieved effects. At the same time, according to the developers of this program, all measures must be interconnected, and it is very important to formulate a long-term strategy from the very beginning, while simultaneously taking action in many areas. Some reforms can be undertaken only at later stages, when market mechanisms are already sufficiently developed.

Combinations of two polar, alternative, diametrically opposed forms of organization of social production - “market” and “non-market”. Chapter III Common features and differences. The distinction between the concepts of a mixed economy and a transition economy gives rise to a number of theoretical provisions that must be taken into account in the modern economic strategy of the Russian government. Firstly, ...

To move from point A, for example, to point B or some other point on the Ps curve, also characterized by a lower inflation rate and unemployment rate. 2.2. Social policy of the state in Russia In a transition economy, priorities and goals change, both in the economic and social spheres. The equalizing system in the distribution of material and spiritual benefits is being eliminated...

The labor market and the traditions of the country, its mentality. Only in this case can the employment situation be improved. Chapter II. Formation of a socio-economic model of employment in the conditions of the transition economy of the Republic of Kazakhstan Weakly regulated entry of the national economy into the market distorts the course of all socio-economic processes in the republic, and...

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Khatunov Sergey Yurievich. Structural relationship between the state and the market in the conditions of internationalization: Dis. ...cand. econ. Sciences: 08.00.01: Moscow, 1999 153 p. RSL OD, 61:99-8/1561-2

Introduction

Chapter 1. The relationship between state and market in the process of internationalization of the economy 12

1.1. The emergence in economic theory of the problem of the relationship between the state and the market, the historical traditions of its research and the current state 12

1.2. Functions of the state and market in the process of internationalization (globalization) of the economy 48

Chapter 2. State and market relationships 62

2.1. Dynamics of structural changes in the relationship between state and market 62

2.2. Sources of internationalization of relations between the state and the market 81

2.3. Forms of development of relations between the state and the market 106

Conclusions and suggestions 136

List of used literature 140

Applications 150

Introduction to the work

Relevance of the research topic

One of the most difficult problems market economy is the internationalization of the economy, since it focuses on the problems of both the national and world economies. The inclusion of the Russian economy, as a market-oriented and open economy, into the system of world economic relations, sometimes outstripping the pace of its internal transformation, has given rise to many problems that require non-standard and unusual solutions, a deeper understanding and thorough study of the history, state and prospects for solving these problems. Interest is shown not only in interstate and macroeconomic relations, but also in the foreign economic activities of firms and enterprises.

In recent decades, the development of international and national economies has depended on the dynamics of interstate relations. In the 70s, the world faced an acute crisis of global economic system. There is an urgent need to provide national markets and the world market with favorable development conditions. Liberation from unnecessary controls on the international flow of goods, services and capital is the largest and most important part of these conditions.

The rise in oil prices and the resulting accumulation of petrodollars triggered one of the largest redistributions of wealth in human history. Governments in developed countries feared inflation and therefore encouraged the transfer of petrodollars to markets developing countries in the form of loans against them government projects development. Such actions by states in the early 1980s gave rise to

global debt crisis. Both developed and developing countries, together with international institutions, sought to stabilize the world economy by creating favorable conditions for market development.

In the decade preceding the 1970s, attention to the study of the relationship between state and market decreased. However, the events noted above led to the revival of this problem. In the 1990s, it became a key issue for the whole world.

The problem of the relationship between the state and the market has become more acute, since even relatively simple phenomena of economic life cannot be explained within the framework of previous ideas. This is due to attempts to use theories developed for specific conditions of interaction between the state and the market, to explain the situation in any conditions, to give these theories universality.

In the 19th century, the problem of the relationship between the market and the state was studied in an undivided form. Research was carried out in the inextricable unity of the state and the market: the market economy was considered the policy of the state, and the policy of the state controlled the market economy.

In the 20th century, further study of the problem was developed in dividing it into two directions: the state and its policies were studied by political science, and the market and economy - by economic science. At the same time, economists studied market models and market conditions, and politicians explained the behavior of individuals and groups in the state and their search for advantages in political associations. There is no doubt that the study of each of these problems has advanced greatly, increasing understanding in its field. However, studying one problem in isolation from the other reduced the significance of the second problem. Events,

What happened after the Second World War forced scientists to become more aware of these problems individually and collectively. After all, many phenomena, such as the oil embargo, relate not only to an economic problem, but also to a political one. They affect not only the problem of the market, but the state.

The problem of the relationship between state and market, existing at the intersection of politics and economics, has thus again become relevant for scientific research. The study of this problem involves both the results of the works of classics of previous centuries and the work of modern economists, politicians and sociologists.

The degree of development of the topic. The problem of the relationship between the state and the market in one aspect or another was considered by A. Smith, D. Ricardo, K. Marx, A. Hamilton, A. Marshall and other scientists. The studies of I. von Thünen, V. I. Lenin, K. Kautsky, J. M. Keynes, K. Polanyi, M. Friedman and others are important for analyzing the relationship between the state and the market and its dynamics.

Currently, the progressive process of the impact of the market economy on public policy requires expansion and deepening of research into this process. In this regard, economic science pays great attention to the issues of the relationship between the state and the market in new conditions, which are determined by the global process. Published by scientists large number articles, monographs, analytical materials of a general and applied nature, in relation to both individual states and markets, and the international system as a whole. Among them, the following foreign economists and sociologists should be noted: T. Abo, R. Barry, R. Boyer, F. Braudel, D. Brody, Y. Bhavati, I. Walleishtein, M.

Weber, R. Gilpin, D. Dreisch, P. Drucker, R. Cooper, F. Lazar, G. Myrdal, R. Petrella, M. Porter, J. Ruggie, M. Staniland, S. Strange, B. Hages, E. Hellener, G. Schwartz, as well as domestic authors: L.A. Bagramov, I.V. Boyko, A.S. Bulatov, N.A. Voiloshnikov, E.A. Dedegkaev, A.P. Kireev, K.B. Kozlova, N.N. Liviytsev, O.Yu. Mamedov, V.T. Musatov, I.M. Osadchaya, B.C. Prigarin, V.T. Ryazanov, I.A. Spiridonov, I.P. Faminsky, V.A. Fedorovich, V.E. Shchevtsov, V.D. Shchetinin, I.P. Shmelev.

At the same time, some provisions remain debatable: the dependence of the domestic economy on the world one, the influence of the state on the world market, the consequences of the development of global economic relations, the direction of interaction between the state and the market, what are the dynamics of the development of relations between the state and the market, etc. The insufficient development of these problems has contributed to the basis for determining the purpose and objectives of the dissertation work.

Purpose and objectives of the study. The purpose of the dissertation is to study the current state of development of the state and the market and substantiate their rational structural relationship in the conditions of internationalization of the economy.

The set goal determined the need to solve the following problems:

Explore the economic and historical aspects of the emergence in theory of the problem of the relationship between the state and the market;

Systematize the economic conditions for the functioning of the state and the market;

Identify and analyze the global dynamics of interaction between the state and the market;

Determine the prerequisites and conditions for liberalization in relations between the state and the market on a global scale;

Reveal the most effective areas of interaction between the state and the market that contribute to the overall internationalization of the economy;

Justify the main prerequisites and consequences of the development of global economic relations.

Object of study. The object of study in this work is the state and the market, which are in dialectical interaction in the context of the accelerating internationalization of the economy.

The subject of the study is the forms of internationalization of economic life with their historical and geographical features of the development of states and markets in a single interdependent complex.

The theoretical and methodological basis of the study is a set of forms and methods of scientific research used in domestic and foreign practice. The dissertation uses an analytical method for assessing the practical results of economic activity. Particular attention is paid to the methods of system analysis, time series and complex consideration of complex problems using a dialectical approach to identifying and explaining contradictions.

In the process of work, special training courses on the problems of relations between the state and the market in the new global order, given to students of the American Graduate School of International Management and students of the University of Central Arkansas, were taken into account.

The sources of information were materials from official statistical reports of the UN, the World Bank, the IMF and statistical departments of a number of countries; annual report data

World Bank, OECD, IMF and others international organizations; materials of GATT and WTO conferences.

Provisions of the dissertation submitted for defense.

1. The internationalization of the economy has led to the emergence of a new system of relationships between the state and the market. The state retains its role as the center of long-term, strategic regulation of the economy, facilitating the adaptation of its economic agents to new conditions of market functioning.

2. The requirements of a market economy determine the factors that govern the interests of the state. In the process of internationalization, the needs of the market are increasingly taking on an objective nature, and the needs of the state are becoming subjective.

3. Determining the theoretical foundations of the relationship between the state and the market should be considered in obtaining assessments in the following areas: assessing the consequences of the development of the global market economy, assessing the relationship between political and economic changes within countries, assessing the importance of the world economy for domestic economies.

4. The forms of development of relations between states and the world market are: economic integration of states into the world market; economic dependence as a mechanism of interaction between the markets of developed countries and the markets of developing countries; economic liberalization of market relations in developed countries; economic globalization as a new form of relationship between the world and national markets.

5. The world system is not just an arena where relations between the state and the market are formed. She is directly involved in this

process and predetermines the laws of movement of markets, and markets, in turn, order the state to develop a certain policy. 6. The development of relationships in the “state - market” system in the context of internationalization gives rise to an infinite number of local subsystems of reference, each of which is valid in a small area, i.e. national and domestic economies. The latter, in turn, are interconnected through measures developed by states and the conditions of globalization of the economy dictated by the market.

The scientific novelty of the study is as follows:

1. The theoretical definition has been expanded that a prerequisite for the internationalization of the economy is a shift in the priority between the state and the market towards the state in view of its main role as a regulator of the economy.

2. It is substantiated that the process of internationalization of the economy is ensured by state protectionism, since the starting point of the world market is still the domestic market, which is controlled by the state.

3. It has been shown that world system predetermines the movement of markets for goods, services, capital, labor, and markets, in turn, prescribe certain economic behavior to the state.

4. It has been proven that the economic feasibility of internationalization for individual countries is ensured by the positive influence of the world market on the domestic market due to the limited size of the latter.

5. The general features of the development of relations between the state and the market are identified, consisting in the similarity of modern relations between the state and the market with their state in the 19th century and

regional, which correspond to the relationship between the state and the market of the country dominant in a given region.

6. A theoretical understanding of the forms of improving the relationship of states with the world market has been developed and the defining feature of their orientation as integration and global has been substantiated.

7. The consequences of economic globalization have been identified, namely that interstate relations are developing more dynamically, causing a change in existing economic contradictions and the emergence of additional ones; the question of a single world economic leader is undergoing significant changes; the functions of the state and the market are expanding.

Theoretical significance of the work. The theoretical development of the concept of the optimal relationship between state and market in modern socio-economic and historical CONDITIONS is an attempt to deepen scientific knowledge in this area. This is due to the need to attract the attention of the scientific community to the fact that in conditions of internationalization, the formation of new approaches to the well-known paradigm is a necessary aspect for all the driving forces of a market economy.

Practical significance of the work. The practical significance of this theoretical study is that its main provisions can be used as recommendations for developing state economic policy, as well as when teaching special courses for students of economic specialties. A number of provisions will help in studying

regional markets, their reactions to the actions of individual states and international institutions.

Publications. The main provisions and results of this study were published in 4 works with a total volume of 2.1 pp.

Scope and structure of the dissertation. The logic of the study determined the structure of the dissertation, which includes an introduction, two chapters, a conclusion, a list of references and applications. The work is presented on 154 pages of typewritten text.

The introduction substantiates the relevance of the chosen topic, the degree of its development, indicates the theoretical and practical significance of the work, defines its subject, goals and objectives, as well as the methodological basis and scientific novelty of the research conducted.

The first chapter examines the essence and content of the approach to the issue of the emergence in economic theory of the problem of the relationship between the state and the market, and also substantiates the need for a more in-depth analysis of the functions of the state and the market in the context of the internationalization of the economy.

In the second chapter, a study is conducted of the dynamics of global processes in the relationship between the state and the market, the sources of internationalization are identified and, on their basis, the forms of development of the relationship between the state and the market are revealed.

In conclusion, the results of this dissertation research are summarized, conclusions and proposals are formulated.

The emergence of the problem of the relationship between the state and the market in economic theory, the historical traditions of its research and the current state

The problems of economic internationalization with their socio-economic and political significance are of significant interest not only for a single country, but also for the entire world community. Global problems are increasingly becoming central to every state or government.

The relationship between the general concepts of “economics” and “politics” reflects the interaction of very complex institutions in society. For their analysis, other concepts close to those mentioned are additionally used, for example, such as “market” and “state”, “wealth” and “power”.

The parallel existence and mutual influence of the “state” and the “market” on each other in the modern world creates an area practical activities- economics. The area of ​​theoretical activity covers the study of both the problems of the state, or rather the economic functions of the state, and the study of market problems. Without these two fundamental parts there would be no full-fledged economic theory (political economy). If the state is inactive, then market forces and the price mechanism will be the only economically active ones and the world will be purely economic. And without the market, the state or its authorities would distribute available economic resources and create a world that belongs purely to politics or political expediency. However, in its pure form, none of these social institutions can exist and, therefore, the influence of the state or market changes occur over time and in different circumstances. Therefore, the concept of "market and state" analysis that we conduct is called by Max Weber the ideal model.1

Economics is characterized as a science that studies the economic aspects and conditions of human political, social and personal life. At the same time, it cannot help but touch on many political issues that a practitioner cannot ignore; therefore it is both a pure and applied science. This is why it is better designated by the broad term “economics” rather than by the narrower term “political economy.” A number of economists such as Gary Becker and Bruno Frey defined political economy as the application of the methodology of strict economics, that is, a model of rational individual behavior in all types of human activity. Marx, Engels, Lenin, Plekhanov use the term “political economy,” seeing in it their own special economic theory, explaining it as social behavior and/or collective action. This theory is otherwise called Marxist. When making a choice of approaches, in political economy they mainly choose one of two methodologies and theories of economics. However, R. Tooze and others use political economy to address a range of issues that give rise to the interaction of economic and political activity and are studied in any available methodological and theoretical way.2

Although the appeal to political economy is based on the application of method and theory in economic science and is very useful, it is nevertheless still insufficient in providing a comprehensive basis for scientific research. Often political and other non-economic factors are weak. The methodology and theory of political economy need to be improved to understand the process of social change, including the interaction of social, economic and political aspects. In these conditions, using the term “political economy”, we are trying to outline the range of specific issues and consider them using all known analytical methods and theoretical aspects.

This study highlights the issues that arise in the interaction between the state and the market, as a consequence of a broader phenomenon - the interaction of politics and economics in the modern world. They reflect judgments about how the state and its associated political processes affect the production and distribution of wealth and how, in particular, political decisions and interests influence the location of economic activities and the distribution of income and expenses from those activities. In other words, these questions examine the effectiveness of market and economic forces on the distribution of power and wealth among states and others. political institutions and especially how these economic forces are changing the global distribution of political and military power. Since neither the state nor the market can act as a primary one, the reason for the connection that determines their relationship is interaction and cyclicality. Thus, the issues under study concentrate mutual influence in a variety of ways to establish order and systematize human activity: in the state and in the market.

Functions of the state and market in the process of internationalization (globalization) of the economy

Recently, the state has increasingly been paying extreme attention to those basic factors of the world market economy that guide or should guide the development of the state. It is the needs of a market economy that determine the factors that govern the interests of the state. In the process of globalization, the needs of the market are increasingly taking on the form of an objective factor, and the needs of the state are becoming subjective. Market needs essentially play a decisive role in the economic structuring of society. Changing market structures are causing the rise of new patterns of economic and political forces that are transforming societies. In the Communist Manifesto, K. Marx and F. Engels describe it as an unsurpassed engine of economic growth: “The bourgeoisie, in less than a hundred years of its class rule, has created more enormous productive forces than all previous generations put together. Conquest of the forces of nature, machine production, the use of chemistry in industry and agriculture, shipping, railways, the electric telegraph, the development of entire parts of the world for agriculture, the adaptation of rivers for navigation, the masses of the population, as if summoned from underground - which of the previous centuries could suspect that such productive forces lay dormant in the depths of social labor? "1 Referring to the need for strengthening international market economy, Karl Polanyi concludes: “...the inclusion of markets in a self-regulating system of enormous power was not the result of the innate tendency of markets to grow rapidly, but rather the result of a strongly artificial stimulation that helped the main part of society in a completely naturally occurring situation that was not created less artificial phenomenon of the machine.”2

The process of globalization is characterized by an increase and acceleration of international flows of various kinds: capital, goods, services, information, innovation, ideas, values, in other words, everything that is invented and produced by man, making his life more interesting. In turn, an exchange that has a global scale appears as a result of three factors: 1) innovative improvements in equipment and technology, especially in the field of transport and communications, 2) the development of the financial sector and 3) the development of global production. Over the past two decades, international financial transactions that are not subject to government control have increased sharply. The volume of international bank loans, that is, loans that cause the cross-border movement of funds and domestic loans denominated in foreign currencies, has grown rapidly from $324 billion in 1980 to $8.5 trillion. dollars in 1996. Volume of daily transactions on foreign exchange markets increased from $250 billion in 1985 to $1,200 billion in the mid-1990s and continues to increase annually by approximately 5-7 percent.1 Rapid growth of international financial transactions was associated with an increase in demand for them from transnational corporations and enterprises that were beginning to internationalize their activities, as well as states whose external debt was sharply increasing. The financial sector has also expanded under the influence of such factors as the spread of illegal trade in arms and drugs, deregulation of the financial sector, acceleration of privatization processes and related security issues.

The modern globalization of enterprises should, in our opinion, be considered as a new stage of their internationalization, which lies in the fact that transnational companies (TNCs) strive to be represented, if not in all, then at least in the most strategically important regions of the world (Appendix 1). For the enterprises themselves, internationalization and globalization are both “a necessity, an ambitious goal and a means to achieve international recognition.”1 Enterprises that have embarked on this path view the world market as a single field of competition, which inevitably causes changes in their organizational structure, which becomes more flexible and mobile. An extreme form of globalization is the creation of temporary networks of enterprises that jointly exploit market opportunities.

At the end of this century, each state faced the problem of combining the need to modernize the technical and economic system and preserve traditional values, i.e. national identity."1 However, economic modernization causes increased inequality both within individual states and on a global scale. Inequality, which for a long time was in the order of things, is today perceived as injustice. At the same time, the process of globalization is very uneven in nature: it affects in different ways individual industries and states. UN statistics show that in the early 1990s, the richest 20% of the world's population accounted for 82.7% of global income, while the poorest 20% accounted for just 1.4%:

The impact of globalization on states occurs in three areas of their activity. First, integration processes. The processes of international integration, reflected in the expansion of international trade and investment, the exchange of modern technologies and other types of human activity, still do not eliminate the state as such, but make their borders more permeable, and also contribute to changes in interstate relations, creating a single field called world community. The development of integration subjects states, as well as enterprises and individuals, to the logic of competition in which they must perform.

Dynamics of structural changes in the relationship between state and market

Since the mid-nineteenth century, the development of international economic theory has brought together competing modern states and the forces globalizing international markets into a dialectical interaction. Economic forces and agents coalesce in the sixteenth century with a nascent capitalism that seeks to transcend the territories, jurisdictions, sovereignties, and political control of states. By focusing on the development of relations between the modern state and the international market, power and wealth, it is possible to determine the structure of international economic relations.

Markets constantly, impartially and subconsciously change the location of production in geographic space. States intervene to help or hinder such market-driven redistribution, but only periodically and on a self-interested basis and often with unpredictable results. States made their greatest successes in controlling international and domestic markets in the post-war period. From 1945 until 1973, states used institutions that were formed during the Great Depression and World War II to regulate domestic economies and protect domestic markets from pressures that came from international markets. However, since 1973, their impacts have become devastating for domestic economies. Markets are becoming increasingly volatile. Industrial and financial capital, which was well established, seemed to move inexorably around the globe, seeking the most advantageous and profitable application for its capabilities, creating spatial inequalities. New competitors emerged from countries that were previously considered distant and their markets unattractive.

Far from being typical, the stability and successful government intervention of the postwar period represented a sharp departure from typical global economic processes. The global economy is effectively moving back in time, becoming more and more like the global economy of the nineteenth century.

An explanation of the typical processes of the pre-war period of the global economy is necessary to see how the post-war period deviated from this process and to provide an understanding of the likely future. Much of what is happening today becomes clear if we consider the main development processes of the pre-war economy. Several tensions between the state and markets were shaped by the pre-war economy.

States and markets, power and wealth were inextricably intertwined in the global economy because the modern state and modern economy develop simultaneously. In fact, neither the state nor the international market could exist without the other. The study of international political economy thus comes close to studying the origins of the state and government system of the sixteenth century and the international market of that time. It is impossible to understand this without turning our attention to agriculture and to the limitations that took place in the division of labor under weak conditions. transport system of that time. Let us begin by examining the situation that reflected the origins of the state and the world market in the sixteenth century.

The modern state is a clearly defined organization with a legal and continuous monopoly of coercion over a defined territory. The monopoly of coercion gives the state the ability to subjugate other organizations and groups within that territory according to its rules and according to its laws. However, creating and maintaining such a monopoly requires resources. In other words, states could obtain them by capturing them outside their territories, however, ultimately the establishment centuries-old tradition a coercive monopoly requires a stable supply of resources within its own jurisdiction. This, in turn, requires limiting legality. Describing this process of legitimacy, Professor Frederick Lane, who specializes in economic history, argues that a robber can become a police chief if he is able to pay and maintain a state monopoly of repression in a certain territory. Agriculture accounted for approximately 80% of all economic activity, making it virtually the only industry that provided resources to all states of that time. However, the nature of agriculture limited the amount of surplus that could be extracted, and even assuming that the surplus could still be extracted, insufficient transport facilities made it difficult to concentrate in the hands of the state. Thus, the nature of sixteenth-century agriculture imposed its limitations on the formation of not only the state, but also the internal market. It was as if they were fighting among themselves for survival. Due to the difficulty of obtaining sufficient resources from agriculture, most states developed a strategy known as mercantilism. According to the concept of this strategy, which was focused on extracting resources from external sources, states were supposed to create an influx of precious metal and thereby cover the insufficiency of internal resources. In fact, such an external orientation of mercantilism was only a means to achieve internal results: the creation of a single internal legal space that strengthened the dominance of the central government. This single space made it possible for states to rely not only on external resources, but also to use the most sustainable internal resources from the reserves created by the state itself. Accordingly, large reserves imply the greatest stability of internal governance and thus of uniform law. An internal political and economic struggle emerged for the implementation of the policy of mercantilism.

Sources of internationalization of state-market relations

In the Anglo-Saxon tradition, as evidenced by some work that appeared in the early 1990s, a distinction was made between states and markets, and economic forces and economic changes were analyzed.1 Where such a distinction leads to a privileged position for some and discrimination against others, it always diverges from historical reality. States and political authorities have a varied set of connections to economic activity, even if non-intervention is proclaimed. Where the distinction serves to define the contribution of the relatively clear actions of political power and the hidden result of an infinite number of private actors, it has a certain analytical value.1

In the capitalist "center" of the world economy, the balance shifts over time from mercantilism, which went hand in hand with the formation of the modern state, to liberalism and back again to a more state-regulated order, first in the era of imperialism, and then shortly after the post-war hiatus the lasting liberal order until the Great Depression of the 1930s. The state during the 1930s had to take on the role of agent of economic revitalization, protector of national welfare and employment from disturbances from the outside world. Corporatism, the union of the state with the productive forces of national level, has become under various names a model of economic regulation.

After the Second World War, the system created by the Bretton Woods agreements began to upset the balance between the liberal world market and the domestic solvency of the state. States began to be responsible for their domestic economic order to the institutions of the international economic order: the International Monetary Fund, the World Bank and the General Agreement on Tariffs and Trade - in order to liberalize trade and stabilize exchange rates and their convertibility. They were also given the means and time to make the necessary adjustments to their previously established national economic practices so as not to sacrifice the welfare of the various groups and sectors of society in those countries. Keynesian demand management, together with the vicissitudes of corporatism, supported this international economic order through all the ups and downs of the capitalist cycle. business activity. Moderate inflation, attributed to the fine-tuning of national economies, stimulated a long period of economic growth. War and weapons production played a key role. World War II lifted national economies out of depression, and the Korean War and Cold War fueled economic growth in the 1950s and 1960s.

The crisis of this post-war order can be traced to the years 1968-1975. During this period, the balanced compromise proposed by the Bretton Woods agreements moved towards the subordination of national economies to the noticeably growing demands of the world economy. States became more responsible to the global economy.

How and why did this happen? It is unlikely that this dissertation research provides a completely adequate explanation. This issue will remain controversial for a long time. However, it is possible to identify the Bretton Woods period as a real turning point in terms of the weakening of old structures and the emergence of new ones. However, several key elements of the transformation (old structural forces to new ones) can be identified as: the structural force of capital; production structuring; the role of foreign debt.

1. Inflation, which was previously a growth driver beneficial to business and organized labor alike, is now, with its high rates and decreasing marginal income, seen by business as an obstacle to investment. Discussions among economists about what exactly is causing this, the traction force of demand or the pressure of rising prices, have not led to a single conclusion. Business blamed trade unions for increasing wages, and the state for cycles of additional, sometimes unjustified costs, loans and taxes. Governments must understand that reviving economic growth depends on business confidence in investment, and confidence depends on the “discipline” to which trade unions and government financial managers must be subject. Investment boycott and capital flight is a powerful weapon that no government can ignore with impunity. A typical demonstration of their effectiveness was given in the policy changes during Mitterrand's presidency in France.

The market system is a phenomenon in constant development. At a certain historical stage, the influence of the state began to be reflected in its evolution. Over the past two centuries, a wealth of experience has developed in the interaction of two economic institutions - the market and the state. In characterizing this socio-economic “tandem”, it is appropriate to note several of its typical features.

1. Both systems mutually determine each other. The market needs an infrastructure, a “playing field” with a set of certain rules, which only the state can create. It also provides a system for protecting players (from external and internal threats). The state needs the market to obtain the necessary resources (for the sake of self-existence and the implementation of the functions intended by society).

2. Institutions have a positive influence on each other. The counter-impact leads to the evolution and mutual adaptation of both systems. Over the centuries, the state has acquired a more liberal, tolerant (in relation to business) character. Businesses are also accustomed to the system of rules. Although tax concealment always persists, in general this phenomenon is becoming less active. Moreover, the interaction of the two institutions ensures the manifestation of additional results, which gives rise to the so-called synergistic effect. Government measures not only help the market neutralize a number of its shortcomings, but also provide an additional effect (expressed in the dynamism of the market economy). The magnitude of the resulting positive depends largely on the optimal combination of the forces of the two “agents”. It should be taken into account that a reasonable proportion (“market - state”) is determined by the historical conditions of development.

By way of illustration, we note that the assistance provided by the state to the market at the first stage of industrial development - in the 18th - early 19th centuries. (in the form of providing a system of legal norms, conditions of external and internal security, a stable national currency, a system of public, i.e. collective goods), had a strong stimulating effect. This led to the fact that in the first half of the 20th century. economic dynamism has become excessive. By that period, the economic system had not yet developed a mechanism that, in the process of expansion, could automatically cause a “braking reflex” necessary to maintain general economic equilibrium between aggregate demand and aggregate supply. World economic crisis 1929-1933 should no longer be interpreted (from the standpoint of today's understanding economic history) is definitely a glitch. It was the first signal demonstrating the power of the uncontrolled expansion of the market element.

3. Each of the two institutions has relative independence. This leads to the presence of different, sometimes opposing interests, caused by the fact that both institutions - both the market one (but lines of firms) and the state one - are systems built on a centralized hierarchy. Each of them (in addition to common goals) also has its own aspirations that encourage independent expansion, its own “personal” income. These incentives become clear if we turn to the category of human egoism. As the classics of political economy noted, the market (represented by a set of firms) expresses the concentration of human will and desires. By analogy, the state can be viewed as a “large team of bureaucrats,” endowed (albeit with prescribed limitations) with the same weaknesses of human nature. As a result, clashes between private and public teams with opposing aspirations and interests are inevitable in a competitive field.

The most striking example of conflict of interests appears in the area tax policy. This is based on the fact that the state (like any living system) strives for expansion. To implement it, resources are needed. Fundraising is provided through taxes. Hence the natural desire for growing tax exemptions (which can sometimes exceed purely functional scales justified by society). As a result, tax pressure increases, which opposes the interests of firms.

Another clear example of the confrontation of interests can be seen in the development of the phenomenon of bureaucratization. Legislative and executive activities carried out by the state objectively create the basis for a system of order in society, which is externally implemented through the adoption of laws, rules, regulations (and, accordingly, the creation of a flow of documentation, which requires a lot of time). However, the excessive increase in “bureaucratic flows” and delays in decision-making also have a target motive that expresses the “personal interests” of the state. This interest is based on economic basis(the possibility of receiving “left” income) and a latent desire to demonstrate their power, administrative rights and functions. The latter gives the government official a blissful sense of self-worth.

A milder example of confrontation can be seen in the growing competition between the two institutions in the field of infrastructure development. In recent decades, the private sector has gradually begun to make material expenditures in this area. This is due to the fact that many large corporations have acquired financial power sufficient to finance a number of infrastructure facilities (in the fields of education, healthcare, transport, insurance, communications and information systems).

The interaction of the two institutions is also realized in a certain external environment, within which the influence of additional circumstances, globalization and world political processes is manifested (Figure 2.2.).

Figure 2.2. Interaction between market and state institutions

When analyzing the interaction of two institutions, it is usually customary to consider the influence that the state has on the market system. This is predetermined by the fact that market shortcomings necessitate the correction of a number of failures, which are difficult for the market itself to cope with. The regulatory process involves a series of aspects:

The state formulates impact goals and develops a strategy that should be optimal among a large group of alternative solutions;

The implementation of economic policy includes a set of subjects: state (Ministry of Finance, Ministry of Economy, Central Bank, local governments, legal authorities) and non-state;

The implementation of economic policy occurs through the use of certain mechanisms: financial (fiscal) and monetary policy,

The need for a wide range of state measures has led to the creation of experience of state action in several areas.

In a generalized form, the process of government regulation can be presented as follows (Figure 2.3.).

Figure 2.3. The impact of the state on the market system

Let us outline the general parameters of the state’s impact on the market system; let us turn to a brief description of those aspects that reflect the counter-impact of the market system on the state (Figure 2.4.).

Figure 2.4. The impact of the market system on the state and economic processes

The analysis of counter-influence encourages us to rely on certain similar structural components (goals, subjects, mechanisms, directions of implementation) that were used in the analysis of the impact of the state on the market economy.

When characterizing the counter-impact of the market system, it is necessary to take into account that this institution has a less clear structure compared to the institution of the state. It contains a dual nature, two principles coexist: spontaneity, on the one hand, and hierarchy, rigid organization on the other.

The multifaceted nature of the market encourages economists to look for ways of its influence on the economic system and the state in two relatively independent directions. The first way is implemented through the analysis of the role of the market environment as a spontaneous, spontaneous beginning. The second path is carried out along the lines of influence of firms and corporations, which presupposes clearly defined target (strategic) settings.

Questions for self-control:

1. What is a socio-economic system. Describe the types of socio-economic systems.

2. Describe the main models of socio-economic systems. What features can characterize the Russian socio-economic system?

3. What is a national economy? Reveal the structure of the national economy.

4. What is a sector of the economy and OKVED?

5. What institutional entities can you name among the subjects of economic policy? What explains their diversity? Why is there a slightly different understanding of subjects of regulation in Russian practice?

6. How does the choice of state economic policy goals depend on the political cycle in the country? How are popular and unpopular regulations distributed over the policy cycle?

7. What is typical for the regulation of macroeconomics by the state?

8. What is the target orientation of macroeconomic regulation by the market?

9. What are the specifics of the regulatory activities of firms? What is the content of direct and indirect methods of influencing the economic policy of the state?

10. What are the similarities and differences between business and government in macroeconomic response?

11. What is the “market for corrupt services”? What is the scientific designation for the income appropriated by the bureaucrat?

12. If corruption has become one of the most pressing problems in the modern world (as discussed at the G8 meeting in 1999), can we say that it is an integral element shadow economy?

13. What is the meaning of the market for corruption services?

14. What is the content of the public services market at the international level?

15. Why does the state seek to adapt elements of a market economy into its institution? How does it do this?

16. In recent decades, an international market for services for foreign investors has developed. What product does the government offer to foreign clients? What benefits does it plan to receive as payment for its goods?

17. What is a public-private partnership? What goals are being achieved? What is the impact of business on economic processes in the country?

18. What changes occur in the division of labor between business and government when implementing partnerships? What is business focusing on, what is the government focusing on?

19. What does the term “alliance capitalism” mean?

20. Is the institution of lobbying a legal or illegal institution?

21. Which aspects of lobbying are justified for a market economy and which are not?

22. What is the relationship between the concepts of “lobbying” and “corruption”?

23. Which aspects of lobbying manifest themselves in real economic life, in your opinion, more definitely, positive or negative?

24. According to analysts, so-called gaps in positions may arise in the actions of government authorities. What are we talking about? Why do these gaps hinder private business? What measures has business traditionally taken to overcome these problems?

25. Why are firms interested in the liberal mood of the population?

26. Why is the media such a desirable field for corporations? Can you name examples of who owns the largest economic newspapers and magazines in Russia?

27. What are the capabilities of the media in influencing the economic outlook of the population?

28. What classification of Russian media (newspapers, magazines, radio and TV stations) could you propose, dividing them into left-leaning (socially oriented) and right-leaning (liberally oriented)?

29. Under what party financing system (budgetary private) does business have a greater chance of influencing political parties (and through them, the atmosphere in society)?

30. What two features of the Russian mentality are especially “convenient” for corporations for their influence on Russian buyers?

Introduction

Economics is defined as the science of choosing directions for using limited resources (factors of production and consumer goods). A market economy is characterized by the presence of “failures” of the market system and objective circumstances that necessitate government intervention in the economy. To eliminate this situation, state regulation of public goods, public expenses, management tax system. An important point in this work is the competent formation of the structure of public expenditures and management of the tax burden. Errors in these matters can lead to serious economic problems in the state, as well as at the level of macroeconomic processes. This will explain the relevance of the chosen topic.

The purpose of the work is to study issues of state regulation of the public sector of the economy. Achieving the goal is possible by solving problems:

Study the concepts of “market” and “state”;

Consider the concept of “public goods” and their properties;

Analyze the problems of shifting the tax burden, study the concept of “excess tax burden”;

Identify the reasons for the growth of the share of the public sector in a market economy, give examples, identify trends;

Determine the structure of public expenditures, identify the dependence of the structure on the factors of the country’s economy.

The theory of public goods has been developed in sufficient detail by modern economic science and is widely covered in the economic literature. In preparing this work, materials from educational literature on macroeconomics and economic theory were used.

Market and state

The market economic system, based on the market mechanism of self-regulation and management of economic life, is recognized by economists as the most effective form of economic organization. This is explained by the peculiarities of the market itself, which, without the intervention of third parties, ensures: efficient distribution of resources through the use of the most effective technologies, best methods organization and production management; economic freedom, both for producers and consumers (in other economic systems, absolute freedom of choice is impossible). The market also has a high degree of adaptability and adaptability to any changes, both external and internal; can function successfully with very limited information (prices provide the main information in a market system); ensures optimal use of scientific and technical progress (in a competitive environment, producers, trying to maximize profits, take risks associated with innovations); able to satisfy a wide variety of needs, stimulating improvement in product quality.

At the same time, as practice shows, the market as a self-regulating system does not always cope with a number of problems whose solution is necessary for society. We are talking about situations when the market mechanism, which is a self-adjusting mechanism, encourages subjects of market relations to make suboptimal or undesirable economic decisions. Moreover, these decisions are not the result of mistakes of individual market subjects, but the result of the functioning of the market mechanism itself, and they are generated by its nature. In economic theory, these market failures are designated by the word “failures” - “failures”, “fiasco”, “inconsistency”, “defects”. These “failures” of the market system constitute the objective circumstances that necessitate government intervention in the economy. Among the main “failures” of the market we can mention: reproduction of significant inequality in income distribution; orientation is mainly not towards the production of socially necessary goods, but towards satisfying the demands of those who have money; inability to eliminate so-called externalities, for example the market does not solve environmental problems; public goods are either not produced or are produced in insufficient quantities (examples of public goods are national defense, maintaining law and order, ambulance service, public infrastructure); the inability to ensure full employment of economic resources, which is manifested, first of all, in such a phenomenon as unemployment; exposure to unstable development with its inherent recessionary and inflationary phenomena; within the framework of a market system, competitive relations may weaken (oligopolistic and monopolistic markets arise); inability to set and solve major national tasks and problems of a political nature; the market itself cannot create some necessary elements for the functioning of the economy ( various types legislation, issue of money, etc.).

So the market system is not flawless. In this regard, there is a need for third-party implementation of external correction of market “failures,” i.e., what the market self-regulation mechanism is not able to do from within. These functions are assumed by the state. In addition, the state is the initiator and conductor of various kinds of economic transformations and reforms in countries with transitive (transition) economies. In these countries, the state carries out the functions of creating the foundations of the market.

State intervention in the economy should not be excessive. In order not to suppress the market mechanisms of the functioning of the economic system, not to deprive it of flexibility and adaptability, and not to reduce economic efficiency, the state should concentrate its efforts where the market reveals its failure. This predetermines the main economic functions of the state.

Most of the generally accepted oppositions between the market system and the state do not hold up when examined closely. First of all, the market is usually characterized as the private sector, while government agencies and employees are classified as the public sector. What are we talking about here? Of course, it is not meant that consumers and business managers pursue private interests, while everyone who works in a government agency is concerned with public interests. A senator who claims that the “public interest” guides all his decisions is in reality guided by his personal vision of the public good, which is closely intertwined with his various private interests - re-election, relationships with colleagues, with the press, concern for his public image, place , which will be assigned to him in historical research. Senators may be less interested than business leaders in maximizing their private cash income, but they are probably on average more interested in acquiring prestige and power.

The same can be said of any employee of a government agency, be it a high-ranking official in a government commission or an employee just starting out in his career at the lowest level. No matter how lofty, noble, and selfless the official goals of a government agency may be, its daily activities are determined by decisions made by mere mortals under the influence of incentives very similar to those in the private sector. Moreover, in recent years, the leaders of many leading corporations have declared their special commitment to the “public interest”, trying to convince us that the main criterion for their policy development is not the maximization of profits, but the fulfillment of obligations to society. Therefore, one should not trust all rhetorical statements about the opposition of private and public interests. It is more important to identify the incentives that actually influence the decisions people make.

Features of the economy of the public sector - the state is one of the subjects of economic activity, although it has one difference: the state and its bodies have the right of coercion within the framework and on the basis of laws, coercion justified from the point of view of economic efficiency and social justice.

It is assumed that:

The state, like entrepreneurs and non-profit organizations, operates in a market environment, and the need for its participation in economic life arises then and only then, the free action of market forces does not ensure the optimal allocation and use of resources;

Goals of government agencies and ways to achieve them, as well as enterprise strategies and non-profit organizations ultimately determined by the interests of individuals and formed in the course of their interaction;

The state uses, first of all, financial instruments to achieve its goals (taxes, public spending).

While many economists recognize the need to combine the market and the state, there are serious disagreements about the proportions and relationships of this combination, the lower and upper limits of the role of the state in the economy, and the forms of state control.

Two polar points of view on this:

Neoliberals (minimum state);

Radicals and statists (leading role of the public sector, direct control through state ownership).

Many economists believe that for development modern society there must be such a scope of state functions that, while ensuring macroeconomic stability, would simultaneously promote microeconomic competition. In addition, compliance with the principles of social justice, respect for the human person and improvements in the quality of people’s lives would be achieved.

The economic role of the state in the modern world is increasing due to the growing scale and complexity of the structure of the market economy. The level of implemented policies is increasing.

The state can, with the help of legal, administrative and economic methods, on the one hand, promote the development of a market competitive mechanism and entrepreneurship. On the other hand, to correct market imperfections due to the increasing differentiation of income levels of the population, the discrepancy between the necessary individual preferences of people, especially in the long and medium term, incompleteness economic information and the presence of a high level of risk in some areas of socio-economic life.

The state must create normal framework conditions for the functioning of a market economy.

Firstly, the most important task of the state is to establish and maintain a legal regime that provides for the rights to the free development of the individual and guarantees of equality of all before the law, guarantees of private property, freedoms (speech, etc.).

Secondly, the state is doing everything possible to maintain and develop effective competition.

Thirdly, the state eliminates market shortcomings and pursues stabilization and structural policies.

Fourthly, it provides social protection and tries to equalize the incomes of workers.