Definition of market economy
: an economy in which most goods and services are produced and distributed through free markets
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Recent Examples of market economy from the Web
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In December 2016, China filed an explosive dispute insisting that the European Union and the United States recognize that China has now become a market economy.
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Only when the Soviet Union collapsed in 1991 and China’s Communists embraced a market economy did much of the world decide that the Marxist maxims on violence should go on the ash heap of history.
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Kelly Cunningham, San Diego Institute for Economic Research NO: The market economy produces what each individual/region/country is best at, relatively more efficient in, and exchanges that production for goods and services of others.
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As a market economy and mindset grows in North Korea, and people are increasingly aware of their backwardness compared to the rest of the world, the pressure on Kim Jong Un to allow real economic development is growing.
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In a market economy, businesses can thrive despite bad policies.
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Sensible regulation is vital to a vibrant market economy.
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In the early 90s, as prominent dissidents such as Mr. Havel and Lech Walesa in Poland entered office, it was widely assumed that the region would transition naturally into democratic states and market economies.
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After prison, Prigozhin and his stepfather took advantage of Russia’s nascent market economy following the collapse of the Soviet Union and opened hot dog stands.
These example sentences are selected automatically from various online news sources to reflect current usage of the word 'market economy.' Views expressed in the examples do not represent the opinion of Merriam-Webster or its editors. Send us feedback.
First Known Use of market economy
1929
Financial Definition of MARKET ECONOMY
market economy
What It Is
A market economy is structured to allow market forces to determine prices with little or no government involvement.
How It Works
In theory, a market economy's functions are based on fluctuations in supply and demand for specific goods and services across an entire market. This relationship results in market prices that efficiently distribute goods and services among market participants who are willing and able to pay for them. Regulations by government are theoretically unnecessary, since market forces shift supply and demand and signal price adjustments conducive for efficient exchange of goods and services. Capitalism in its purest form exists in a market economy.
Why It Matters
Most developed industrial economies are a hybrid of market economies and government oversight. Fiscal and economic policies are implemented to protect the less fortunate and sustain overall well-being, include minimum wage laws, social insurance programs and subsidized health care.
Source: Investing Answers
MARKET ECONOMY Defined for English Language Learners
market economy
Definition of market economy for English Language Learners
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: an economic system in which prices are based on competition among private businesses and not controlled by a government
Learn More about market economy
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Britannica.com: Encyclopedia article about market economy
Seen and Heard
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