Lecture №6Lecture №6

Theme: Essence and the Theme: Essence and the basic lines of market basic lines of market economy. The market economy. The market

and its structure.and its structure.

THE PLAN:THE PLAN: Essence and value of market economy.Essence and value of market economy. Radical lines of market economy. Radical lines of market economy. Essence and functions, market signs.Essence and functions, market signs. Classification of the markets, as structural Classification of the markets, as structural

elements of market system. A market elements of market system. A market infrastructure.infrastructure.

Set of institutes of the modern market.Set of institutes of the modern market. Transition of Uzbekistan to market Transition of Uzbekistan to market

relations.relations.

The market is a high standard of The market is a high standard of well-being of the population even at well-being of the population even at former level of efficiency because former level of efficiency because market relations start the market relations start the mechanism of distribution of a mechanism of distribution of a public product in which is public product in which is accurately defined what part is due accurately defined what part is due to the state, what to region, and to the state, what to region, and what to the worker.what to the worker.

Market relations are more democratic, Market relations are more democratic, they exclude dictatorship of the they exclude dictatorship of the manufacturer, to subordinate manufacture manufacturer, to subordinate manufacture by interest of the consumer, really to by interest of the consumer, really to consider demand for production, quickly to consider demand for production, quickly to react to changes коньюктуры, and also to react to changes коньюктуры, and also to limit intervention in economy and to offer limit intervention in economy and to offer not only withdrawal of a part of an not only withdrawal of a part of an industrial product through the taxation industrial product through the taxation mechanism, but also the return information mechanism, but also the return information and the reporting about that, on what this and the reporting about that, on what this part of a product is used. part of a product is used.

There are following radical lines There are following radical lines of market economy;of market economy;

Economic pluralism which Economic pluralism which consists in balance of various consists in balance of various patterns of ownership and patterns of ownership and managing. In market economy managing. In market economy co-operates private, collective co-operates private, collective (corporate) and state ownership, (corporate) and state ownership, including every possible variants including every possible variants of their updating.of their updating.

Economic activities freedom Economic activities freedom when subjects of economy, when subjects of economy, proceeding from own interests proceeding from own interests defines a sort and activity defines a sort and activity scales, an exchange occurs on scales, an exchange occurs on the basis of freely developing the basis of freely developing market prices, distribution and market prices, distribution and assignment of incomes too assignment of incomes too occurs at the discretion of occurs at the discretion of subjects.subjects.

Antimonopoly character of Antimonopoly character of economy. Balance of patterns of economy. Balance of patterns of ownership and managing ownership and managing excludes a monopoly position of excludes a monopoly position of separate subjects of economy.separate subjects of economy.

The market economy is based in The market economy is based in monetary relations. Money the monetary relations. Money the integral element of economy, the integral element of economy, the basic means of an establishment basic means of an establishment of economic relations. Steady of economic relations. Steady monetary system – an monetary system – an indispensable condition of indispensable condition of development of market development of market economy.economy.

The market economy is based The market economy is based on a competition which is the on a competition which is the powerful lever of economic powerful lever of economic growth. For modern market growth. For modern market economy are characteristic the economy are characteristic the civilised, perfect competition. civilised, perfect competition. The competition that force The competition that force which regulates and which regulates and supervises the market.supervises the market.

The market economy is an economy of The market economy is an economy of equal possibilities for all subjects, equal possibilities for all subjects, however their realisation depends on however their realisation depends on enterprise ability of everyone. enterprise ability of everyone.

Market economy – adjustable Market economy – adjustable economy. Its basic regulator is market economy. Its basic regulator is market price which leads up demand of the price which leads up demand of the market to the manufacturer, through market to the manufacturer, through adaptations of economic activities the adaptations of economic activities the market requirement occurs self-market requirement occurs self-control at macroeconomic level.control at macroeconomic level.

Market relations have a social Market relations have a social orientation, are directed on orientation, are directed on satisfaction of requirements of satisfaction of requirements of people through saturation of the people through saturation of the market by the goods and market by the goods and services, provide a material services, provide a material prosperity, growth of a prosperity, growth of a consumption level of all consumption level of all population for maintenance of population for maintenance of the general well-being.the general well-being.

Intrinsic features of the market are shown Intrinsic features of the market are shown in its functions:in its functions:

Information – the market informs through Information – the market informs through the prices on a parity of supply and the prices on a parity of supply and demand of the goods and services on it;demand of the goods and services on it;

Intermediary – it connects subjects of Intermediary – it connects subjects of relations for interchange by results of the relations for interchange by results of the activity;activity;

Ценообразующая – the market specifies Ценообразующая – the market specifies true cost of the goods which the buyer as true cost of the goods which the buyer as recognises only socially necessary recognises only socially necessary expenses agrees to pay; expenses agrees to pay;

Regulating – the market influences all spheres Regulating – the market influences all spheres of economy and first of all on manufacture, of economy and first of all on manufacture, giving answers to questions; that, as well as giving answers to questions; that, as well as for whom to make;for whom to make;

Sanifying function is shown that the market – Sanifying function is shown that the market – rigid and even cruel system which by means of rigid and even cruel system which by means of a competition clears manufacture from a competition clears manufacture from economically not viable manufacturers, giving economically not viable manufacturers, giving green light more enterprising and effective. green light more enterprising and effective. This «natural selection» is so rigid that under This «natural selection» is so rigid that under N.Samulsona's certificate, in the USA to half of N.Samulsona's certificate, in the USA to half of all various shops stop the activity in a current all various shops stop the activity in a current of 3 years from the moment of opening.of 3 years from the moment of opening.

Market signs:Market signs: Noncontrollable demand (buyers Noncontrollable demand (buyers

define, as how many to get, define, as how many to get, proceeding from the requirements proceeding from the requirements and solvency);and solvency);

The noncontrollable offer The noncontrollable offer (manufacturers independently (manufacturers independently define, what goods and in what define, what goods and in what quantity to make, proceeding from quantity to make, proceeding from available resources and being available resources and being guided by motive of profitableness);guided by motive of profitableness);

The free price The free price counterbalancing supply and counterbalancing supply and demand (stimulus of demand (stimulus of fulfilment of the transaction fulfilment of the transaction for the buyer and sellers is for the buyer and sellers is взаимовыгода, differently взаимовыгода, differently the exchange simply does not the exchange simply does not occur);occur);

Classification of the markets:Classification of the markets: To a territorial sign;To a territorial sign; Local (within village, a city, area)Local (within village, a city, area) National (internal)National (internal) World (external)World (external) On intensity of functioningOn intensity of functioning The basic marketThe basic market The additionalThe additional The fruitlessThe fruitless The potentialThe potential прослоечныйпрослоечный

On character of sales;On character of sales; The wholesaleThe wholesale The retailThe retail On saturation level;On saturation level; The equilibrium The equilibrium The scarceThe scarce The superfluousThe superfluous On conformity to the current legislation;On conformity to the current legislation; The legalThe legal Illegal (the black market)Illegal (the black market)

On degree of restriction of a On degree of restriction of a competition;competition;

Pure competitiontPure competitiont Pure monopolyPure monopoly The free marketThe free market To a branch sign;To a branch sign; Light industryLight industry The textile industryThe textile industry The computer industryThe computer industry

Under the maintenance and Under the maintenance and appointment;appointment;

The consumer marketThe consumer market The market of servicesThe market of services The financial marketThe financial market The market of innovationsThe market of innovations The labour marketThe labour market The market of investmentsThe market of investments

The market infrastructure is an The market infrastructure is an environment, an environment environment, an environment promoting normal functioning of promoting normal functioning of market relations.market relations.

Functions of an infrastructure of the Functions of an infrastructure of the market are: simplification its subjects market are: simplification its subjects realisation of their interests, increase realisation of their interests, increase of efficiency and efficiency of their of efficiency and efficiency of their work, organizational registration of work, organizational registration of market relations, legal and economic market relations, legal and economic control over them.control over them.

System of commercial banks and System of commercial banks and the insurance companiesthe insurance companies

The developed network of The developed network of specialised stock exchangesspecialised stock exchanges

Means of business communicationsMeans of business communications Advertising agencies and mass Advertising agencies and mass

mediamedia Tax and customs systemTax and customs system The advisory companiesThe advisory companies The auditor companiesThe auditor companies

As practical experience testifies, the As practical experience testifies, the modern market includes the modern market includes the following set of institutes.following set of institutes.

In – the first, the legal system which In – the first, the legal system which will organise legal regulation of the will organise legal regulation of the market here enters and keeps market here enters and keeps interests of subjects of market interests of subjects of market relations. The basis of this system is relations. The basis of this system is made by the civil code which is made by the civil code which is carrying out a role of the economic carrying out a role of the economic constitution.constitution.

In – the second, set of institutes includes bodies In – the second, set of institutes includes bodies of the state control and regulation. of the state control and regulation. Establishments on sanitary, epidemiological Establishments on sanitary, epidemiological control, the tax system Here means. control, the tax system Here means.

In – the third, associations concern market In – the third, associations concern market institutes, consumers unions, businessmen and institutes, consumers unions, businessmen and workers. They raise degree, organisation, workers. They raise degree, organisation, civilisation and efficiency of actions of market civilisation and efficiency of actions of market agents.agents.

In – the fourth, for normal work of In – the fourth, for normal work of market system the general device of market system the general device of economic life is necessary. This economic life is necessary. This trade enterprise, stock exchanges, trade enterprise, stock exchanges, banks etc. they connect banks etc. they connect manufacturers, trading manufacturers, trading intermediaries and buyers in a intermediaries and buyers in a single whole. Such integrity gives to single whole. Such integrity gives to the market new quality - ability to the market new quality - ability to self-regulation. Self-regulation is self-regulation. Self-regulation is carried out with the help. The prices carried out with the help. The prices changing under certain laws.changing under certain laws.

In Uzbekistan the program different In Uzbekistan the program different from other economic reforms is from other economic reforms is accepted. The basic directions of this accepted. The basic directions of this program:program:

Agriculture reform – a source of Agriculture reform – a source of national wealth by liberation and national wealth by liberation and increase of procurement prices, increase of procurement prices, creation of farms;creation of farms;

Protection of socially vulnerable social Protection of socially vulnerable social classes, strengthening of the classes, strengthening of the mechanism of social protection;mechanism of social protection;

Increase in manufacture of a share Increase in manufacture of a share of end-products, i.e. ready to of end-products, i.e. ready to realisation;realisation;

Development of joint and private Development of joint and private business;business;

Consecutive development of a Consecutive development of a market infrastructure – a network of market infrastructure – a network of commercial banks, modern financial commercial banks, modern financial and tax system, auditor and the and tax system, auditor and the insurance mechanism, stock insurance mechanism, stock exchanges. exchanges.