Economic Environment of China Essay Example | Topics and Well Written Essays - 4250 words

Economic Environment of China - Essay Example This issue is one of the most sought after topics for the researchers because in the recent years a lot of flexibility has been allowed in the economic system of China. There are several sectors where the private players are being allowed to exist in the market. The stringent restrictions on the property rights of the country have also been relaxed. The paper also analyses the economic systems that the other developed and developing countries have adopted. The comparison of the economic systems provides an insight into the various pros and cons of the set ups that are existent across the world. The fundamental premise for the contention is that the economic structure and the systems of a particular economy are a major determinant of the growth and prosperity of the economy. The world has witnessed the set up of different kinds of economic systems over different eras. There are various countries that have adopted different theories and have tried to implement them into their economies . The economic set up that China, Russia or Poland have followed the socialist structure while that of the US or German Economy have adopted the capitalist set up. In this paper comparison of China has been done with the other countries that work on a different economic model. A variety of economic systems around the world can be observed. In the Capitalist economic system which is alternatively called the market economy, the forces of demand and supply are allowed to operate. The prices and quantities to be sold are determined in the free market and there is no restriction put by the government on the determination of the prices that are sold in the market. Thus the profit or surplus that is earned by the owners of the means of production remains on their hands and the employees or the workers are eligible for salaries or wages (Gardner 27). The economic structure of the United States is of the capitalist type because this ideology has been applied in the economic system of the Uni ted States. In an alternative system that is the Socialist structure of the economy, the entire ownership of the means of the production lies with the government of the country. In this kind of a socialist system the surplus that is derived out of the production of goods and services after the payment of the wages are equitably distributed among the people that constitute the residents of the entire nation. Even the disabled people who directly cannot contribute to the production get an equal share of the surplus as the wage earners are entitled to. The main proponents of the theory of socialism were Karl Marx and Friedrich Engels. They believed in the theory of class struggle and the theory of surplus value. A third kind of economic system that has the quality of both the capitalist structure and the socialist structure is the mixed economy. In this kind of an economic structure, the public and the private sector institutions coexist (Conklin 37). The government of such mixed econo mies does not interfere into the activities of the private sector directly but they do have certain restrictions imposed on them in the form of legal and constitutional regulations. The economy of India is an example of mixed economy where there is the coexistence of the private and the government players in the markets. Literature review The