hich the government controlsand regulates production, distribution, prices, etc. "but a commandeconomy, while also having this type of regulation, necessarily has substantialpublic ownership of industry. Therefore, command economies are plannedeconomies, but not necessarily the reverse (example: Nazi Germany's privateownership yet use of the Four Year Plan could construe them as a plannedeconomy, but not necessarily a command economy, while the Soviet Union withpublic ownership would be a command economy).
Important planned economies that existed in the pastinclude the economy of the Soviet Union, which was for a time the world'ssecond-largest economy. Beginning in the 1980s and 1990s, many governments presidingover planned economies began deregulating and moving toward market basedeconomies by allowing the private sector to make the pricing, production, anddistribution decisions. Although most economies today are market economies or mixedeconomies, planned economies exist in some countries such as Cuba and NorthKorea.
3.4.Traditional economy en.wikipedia.org/wiki/Planned_economy- _note-2 # _note-2
A traditional economy is aneconomic system in which resources are allocated by inheritance, and which hasa strong social network and is based on primitive methods and tools. It isstrongly connected to subsistence farming. In the majority of countries traditionaleconomy has been replaced by command economy, market economy or mixed economy.However, it is found today mainly in underdeveloped, agricultural parts of SouthAmerica, Asia, and Africa. There are some advantages anddisadvantages in a traditional economy. Advantages: a traditionaleconomy fosters the sense of community, as it causes little friction amongmembers and provides a sense of security and psychological comfort.Subsequently, there is a relatively low unemployment rate and low crime rate. Atraditional economy allows for a greater degree of autonomy as no money orlittle is given to the government and there is no competition. Disadvantages: atraditional economy does not allow for much economic growth and development aschanges are very slow and there is a lack of social mobility. A traditionaleconomy does not take advantage of technology and there is relatively littlepromotion of intellectual and scientific development. With no incentives for entrepreneurs,the consumer choice is diminished, which leads to a lower standard of living.
3.5. Participatory economics
Participatory economics, often abbreviated parecon, isa proposed economic system that uses participatory decision making as an economicmechanism to guide the allocation of resources and consumption in a given society.Proposed as an alternative to contemporary capitalist market economies and alsoan alternative to centrally planned socialism or coordinatorism, it isdescribed as "an anarchistic economic vision". It emerged from thework of activist and political theorist Michael Albert and that of radical economistRobin Hahnel, beginning in the 1980s and 1990s.
The underlying values ​​that parecon seeks to implementare equity, solidarity, diversity, and self-management. It proposes to attainthese ends mainly through the following principles and institutions:
В·workers 'and consumers'councils utilizing self-managerial methods for decision making,
В·balanced job complexes,
В·remuneration according toeffort and sacrifice, and
В·participatory planning.
4. Changes of an economic situation inRussia
4.1. Recent economic developments
A booming domestic market continues todrive strong economic growth in Russia. Substantial net capital inflows havenow joined receipts from resource exports in fueling domestic demand. In thiscontext, the pace of economic growth has accelerated since the second quarterof the year. Annual GDP growth could reach 7.0 percent. Fixed capitalinvestment and FDI have also exhibited impressive growth. The economicexpansion continues to be concentrated primarily in non-tradable sectors of theeconomy that have profited from a stronger ruble. Stagnating production, highinvestment needs, and rapidly-growing domestic demand are raising increasingconcerns about the state of the Russian energy sector.
Following the stabilization of oil prices,Russia's large current account surplus has finally begun to contract. Yet astronger capital account has somewhat compensated for this trend, supportingthe continued accumulation of foreign reserves, albeit at a slower pace. Rapidgrowth in money supply and higher federal expenditures in 2006 have beenlargely absorbed by higher-than-expected economic growth. Inflation has slowedconsiderably in the second half of the year. The planned 2007 budget foreseesan expansion of federal expenditures of 0.9 percent of GDP, with priorities inadditional expenditures going to the state apparatus, investment and socialprograms.
Real incomes of the population, wages, andretail trade have been growing in double digits, significantly outpacing GDPgrowth. Consistent with this picture, import growth soared to 29 percent forthe first three quarters of the year.
Recent policy initiatives of the government include aplanned package of measures aimed at promoting diversified growth and theinnovation economy and new legislative initiatives on migration. A long awaitedbilateral agreement with the United States could pave the way for Russia'saccession to the WTO in the near future.
MainMacroeconomic Indicators
2001 2002 2003 2004 2005 2006
GDP growth,%5.1 4.7 7.3 7.2 6.4 6.5
Industrialproduction growth, yoy,% 4.9 3.7 7.0 8.34.0 4.3
Fixed capitalinvestment growth,%, yoy 8.7 2.6 12.5 10.9 10.512.6
Federalgovernment balance,% GDP 3.0 2.3 1.7 4.27.5 8.6
Inflation (CPI),% Change, yoy 18.6 15.1 12.0 11.7 10.97.5
Current Account,billion $ 35.1 32.8 35.9 60.186.6 79.9
Reserves(Including gold) billion $, end-op 36.6 47.8 76.9 124.5182.2 272.5
Active vocabulary
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