When disputes are held about various aspects of human activity, human rights, duties and other things, considerable attention is paid to environmental conditions. The question of whether democracy is needed in a market economy is often raised. Let’s look for an answer to it.
general information
Initially, let's turn to economic theory for an answer. It is this science that carefully examines the market model as a self-regulating mechanism of interaction on the economic plane. Let's put a brief emphasis on the most important details. To organize effective relationships between subjects of one society, the mechanism of the “invisible hand of the market” is used. It is based on obtaining personal benefits from the sale of goods or the provision of services. Ultimately, this leads to the fact that the quality of the assortment provided is increased. In addition, it is also expanding. And all this is the result of free competition. That is, this state of affairs is formed under the influence of supply and demand. Moreover, with each unit sold, the owner makes a profit. In a market economy, this is expressed by the fact that he pays the employee a part of the value of the goods made by him or the service rendered. And all that is above this (minus depreciation expenses) goes to the formation of capital. Now let's look at whether a market economy needs democracy.
Precedents
The most popular are allegations that for successful economic activity within the market it is democracy that is needed. But this is not entirely true. So, a number of authoritarian movements are of interest to us. Their peculiarity is that they reserve, as a rule, only the sphere of politics. And everything else, including the economy, is not limited. But this does not always apply to authoritarianism. One of the most telling examples is the UK. In this country, there is a system of constitutional monarchy, but this does not prevent it from being one of the most successful countries in the world. One has only to recall how many citizens from our state live there. Yes, that could be it. Now let's look at how democracy and a market economy are connected.
Ideal interaction
Let's look at a generalized and somewhat idealized model of how democracy and the economy work. In this case, every citizen is a free person and has certain rights (there are also obligations in favor of the state in whose territory he lives). In this case, it is necessary to solve the issue of food. A person decides that his knowledge is enough to go about his own business. In this case, they decide to open a company that will provide services or produce goods. If the products turn out to be quite high-quality, well-publicized, things will go up. The task of the authorities is to provide the opportunity for the development and implementation of such a scenario.
Another example is South Korea and Singapore. The correlation of market economy and democracy in these countries differs significantly from those states that are often indicated as reference ones. But at the same time, Singapore and South Korea were able to build a good economy. And although at the time of its construction the local regime resembled a dictatorship (and to many it still resembles it), now there are democratic regimes of power.
What's better?
Which power regime is more acceptable? A definite answer cannot be given to this question. Does democracy need a market economy? Social studies says yes. But there is a possibility that an unworthy person will come to power. And even if the right people will manage all the processes, in a democracy there are many opportunities to put them in the wheel. Then perhaps it is worth using the services of authoritarianism? After all, there are successful countries - the same South Korea and Singapore. But here, how lucky. After all, there was, for example, a country such as Cambodia, in which the Khmer Rouge regime ruled. And he turned into millions of victims. In general, this option can be compared with a lottery - with luck or not.
Features
But the main question of our article: "Is democracy necessary for a market economy?" Therefore, let's decide what advantages we have in this case. Initially, it should be noted that with democracy it is possible to influence the decisions made in the country, to unite people who hold approximately the same views. There are more mechanisms to influence the decisions you need. And if they will be useful also for numerous entrepreneurs, then it will not be difficult to get support. Thus, decisions will be made that will help entrepreneurship develop more actively. Also, due to relative freedom in a democracy, everyone can do their favorite thing, if it does not contradict the legislation adopted in the country.
