State capitalism

The capitalist state is a model that prioritizes the state as a participant in the economy through state companies and competing with the private sector within the economic system .

In a capitalist social and economic environment , institutions and governments supervise and control the economic activity of the territory in question following guidelines and practices of a marked capitalist tone.

In that sense, it is understood that the operation of a capitalist company is applied to the way in which the Administration of a State is directed. To this end, very diverse microeconomicpractices are applied to macroeconomic and national level management .

Its origin is attributed to the growth of the bourgeois phenomenon, where economic elites of diplomats, merchants and bourgeois entrepreneurs assumed political and economic control in countries like England in its colonial phase. These agents applied to the policy the methodologies with which they acted and made fortune in their companies.

Basic scheme of state capitalism

As indicated, state capitalism at its most basic conceptual level establishes that the State, through its government and its institutions and means of control, directs the economic, commercial and business life of the country as if it were a great business.

Thus, governments of this type seek the increase of the national benefit and the increase of wealth of the country to, henceforth, invest these gains in new production points.

This is done through companies or state-type companies that participate in the markets in the form of public companies, seeking to obtain economic benefits and not allowing private companies to assume that activity completely ( monopoly state capitalism ), or at least competing with they.

It is also common for the State to absorb or nationalize companies , rescue them after bankruptcy or expropriate them for various reasons and assume their control. The sectors most prone to this are energy resources (state-owned oil companies), raw materials or distribution of goods and services (state postal services, for example).

State capitalism and economic ideology

However, over the years the different studies of economic theory have defined state capitalism in different ways, greatly diluting its meaning and being applied to several economic models without much relation to each other, a priori.

In that sense, state capitalism has been considered since the final phase of the capitalist model at a level of totalitarian communist management .

Thus, assuming that control of ownership and administration of resources and factors of production fall on the State, different socio-political and ideological theories identify state capitalism as an extreme point of capitalism, and even as a socialist side or communist .

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