VMixed Economy

Text Vocabulary

COMPREHENSION

Ø What economic systems exist? Which classification is the most common?

Ø What are major features of the market economy?

Ø Is there any planning in a market economy? Why?

Ø What kind of market is monopoly?

Ø What is the role of the government in the market economy?

output	выпуск (продукции); производство	Government statistics show the largest drop in industrial output for ten years.
profit margin	размер прибыли	A profit margin is the difference between the selling price of a product and the cost of producing and marketing it.
welfare	благосостояние	The price rises will be cushioned by welfare benefits.
competitor	конкурент	SYN: rival A company’s competitors are companies who are trying to sell similar goods or services to the same customers.
incentive	стимул; льгота	SYN: encouragement; stimulus; spur He said the government must introduce tax incentives to encourage investment.
production costs	производственные издержки	In 1989 the price of coffee fell so low that in many countries it did not even cover the production costs. Production costs began to spiral.
goods	мн. товары	Money can be exchanged for goods or services.
antitrust	антимонопольный	In the United States, antitrust laws are intended to stop large firms taking over their competitors, fixing prices with their competitors, or interfering with free competition in any way.
private ownership	частная собственность	Private ownership is guaranteed by the U.S.Constitution.
entrepreneur	предприниматель	An entrepreneur is a person who sets up businesses and business deals.
after-sale service	послепродажное обслуживание	Our company offers after-sale service to all our clients.

Between market economies and command economies can be found mixed economies. In a mixed economy, certain sectors of the economy are left to private ownership and free market mechanisms, while other sectors have significant state ownership and government planning. Mixed economies are relatively common in Western Europe; although they are becoming less so. France, Italy and Sweden can all be classified as mixed economies. In these countries the governments intervene in those sectors where they believe that private ownership is not in the best interests of society. For example, Britain and Sweden both have extensive state-owned health systems that provide free universal health care to all citizens (it is paid for through higher taxes). In both countries it is felt that government has a moral obligation to provide for the health of its citizens. One consequence is that private ownership of health care operations is very restricted in both countries.

In mixed economies, governments also tend to take into state ownership troubled firms whose continued operation is thought to be vital to national interests. The French automobile company Renault was state owned until recently. The government took over the company when it ran into serious financial problems. The French government reasoned that the social costs of the unemployment that might result if Renault collapsed were unacceptable, so it nationalized the company to save it from bankruptcy. Renault's competitors weren't thrilled by this move, since they had to compete with a company whose costs were subsidized by the state.

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