73-600: The State Management Scheme was the nationalisation of the brewing, distribution and sale of liquor in three districts of the United Kingdom from 1916 until 1973. The main focus of the scheme, now commonly known as the Carlisle Experiment , was Carlisle and the surrounding district close to the armament factories at Gretna , founded in 1916 to supply explosives and shells to the British Army in
146-400: A comprehensive view of socialization during the socialization debates. "Total socialization" involved not only a form of ownership but also the establishment of economic planning based on calculation in kind , and was contrasted with "partial socialization". "Partial socialization" involved the use of in-kind calculation and planning within a single organization, which externally operated within
219-431: A deeper process of transforming the social relations of production within economic organizations as opposed to simply changing titles of ownership. In this sense, "socialization" often involves both a change in ownership and a change in organizational management, including self-management or some form of workplace democracy in place of a strict hierarchical form of control. More fundamentally, social ownership implies that
292-422: A definition strictly involving common ownership , critiquing Soviet-type economic planning : The first requirement of Communism is the socialization of the land and of the machinery of production and distribution. Socialized land and machinery belong to the people, to be settled upon and used by individuals or groups according to their needs. In Russia land and machinery are not socialized but nationalized . In
365-409: A different political party or faction is in power. A re-nationalization process may also be called "reverse privatization". Nationalization has been used to refer to either direct state-ownership and management of an enterprise or to a government acquiring a large controlling share of a publicly listed corporation . According to research by Paasha Mahdavi, leaders who consider nationalization face
438-482: A dilemma: "nationalize and reap immediate gains while risking future prosperity, or maintain private operations, thereby passing on revenue windfalls but securing long-term fiscal streams." He argues that leaders "nationalize extractive resources to extend the duration of their power" by using "this increased capital to secure political support." Nationalization can have positive and negative effects. In 2019 research based on studies from Greenwich University found that
511-453: A form of autonomous public ownership , drawing a distinction between state-owned and directed enterprises. Nove advocates for the existence of both forms of enterprise in his model of feasible socialism. Public ownership was advocated by neoclassical socialist economists during the interwar socialist calculation debate, most notable Oskar Lange , Fred M. Taylor , Abba P. Lerner and Maurice Dobb . Neoclassical market socialist economists in
584-426: A government to take property in certain situations. Due to political risks that are involved when countries engage in international business, it is important to understand the expropriation risks and laws within each of the countries in which business is conducted in order to understand the risks as an investor in that country. Studies have found that nationalization follows a cyclical trend. Nationalization rose in
657-770: A market economy. James Yunker argues that public ownership of the means of production can be achieved in the same way private ownership is achieved in modern capitalism, using the shareholder system that effectively separates management from ownership. Yunker posits that social ownership can be achieved by having a public body, designated the Bureau of Public Ownership (BPO), own the shares of publicly listed firms without affecting market-based allocation of capital inputs. Yunker termed this model Pragmatic market socialism and argued that it would be at least as efficient as modern-day capitalism while providing superior social outcomes as public ownership would enable profits to be distributed among
730-469: A natural, non-monetary economic system became widespread within the socialist movement following the end of World War I. Neurath's position was held in contrast to other socialists in this period, including the revisionist perspective stemming from Eduard Bernstein , the orthodox social democratic perspective of Karl Kautsky , the Austro-Marxism models of labor-time calculation from Otto Bauer and
803-403: A non-market planned economy. Public ownership can exist both within the framework of a market economy and within the framework of a non-market planned economy. In market socialist proposals, public ownership takes the form of state-owned enterprises that acquire capital goods in capital markets and operate to maximize profits, which are then distributed among the entire population in the form of
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#1732772427572876-498: A planned fashion. A planned economy, which adjusts production to the needs of the community, would distribute the work to be done among all those able to work and would guarantee a livelihood to every man, woman, and child. The education of the individual, in addition to promoting his own innate abilities, would attempt to develop in him a sense of responsibility for his fellow-men in place of the glorification of power and success in our present society. Others have proposed cooperatives as
949-400: A process is the restructuring of the economic framework, organizational structure and institutions of an economy on a socialist basis. The comprehensive notion of socialization and the public ownership form of social ownership implies an end to the operation of the laws of capitalism , capital accumulation and the use of money and financial valuation in the production process, along with
1022-685: A restructuring of social relations to overcome alienation , replacing hierarchical social relations within the workplace with an association of members. Some who disagree with state socialism consider it distinct from the process of " nationalization " which does not necessarily imply a transformation of the organizational structure of organizations or the transformation of the economic framework under which economic organizations operate. Emma Goldman wrote in 1935 in There Is No Communism in Russia from an anarchist perspective in favor of
1095-546: A restructuring of workplace-level organization. Social ownership is variously advocated to end the Marxian concept of exploitation , to ensure that income distribution reflects individual contributions to the social product , to eliminate unemployment arising from technological change, to ensure a more egalitarian distribution of the economy's surplus, or to create the foundations for a non-market socialist economy. In Karl Marx 's analysis of capitalism, social ownership of
1168-625: A small group of private owners is the source of the vast inequalities in contemporary capitalism, this establishes the ethical case for social ownership and socialist transformation. Socialization is broadly conceived as a process that transforms the economic processes and, by extension, the social relations within an economy, away from capitalist relations. Depending on the specific definition, it may include central planning , decentralized planning , cooperatives , syndicalism , communization , or other strategies of establishing social ownership. The Marxist understanding of socialization sees it as
1241-449: A social dividend. In non-market models of socialism, public ownership takes the form of a single entity or a network of public entities coordinated by economic planning. A contemporary approach to socialism involves linking together production and distribution units by modern computers to achieve rapid feedback in the allocation of capital inputs to achieve efficient economic planning. The economist Alec Nove defines social ownership as
1314-401: A socialized economy. A further distinction arose between market socialists who argued that social ownership can be achieved within the context of a market economy, where worker-owned or publicly owned enterprises maximized profit and those who argued that socially owned enterprises operate according to other criteria, like marginal cost pricing. In most cases, "socialization" is understood to be
1387-690: A specific solution of socialization in both command economies and market economies . During the 1920s, socialists in Austria and Germany were engaged in a comprehensive dialogue about the nature of socialization and how a program of socialization could be effectively carried out. Austrian scientific thinkers whose ideas were based on Ernst Mach 's empiricist notion of energy and technological optimism , including Josef Popper-Lynkeus and Carl Ballod, proposed plans for rational allocation of exhaustible energy and materials through statistical empirical methods. This conception of non-capitalist calculation involved
1460-545: A strategy to build socialism, more commonly nationalization was also undertaken and used to protect and develop industries perceived as being vital to a nation's competitiveness (such as aerospace and shipbuilding), or to protect jobs in certain industries. Nationalization has had varying levels of support throughout history. After the Second World War , nationalization was supported by social democratic and democratic socialist parties throughout Western Europe, such as
1533-492: A whole or to the members of a given enterprise. Social ownership would enable productivity gains from labor automation to progressively reduce the average length of the working day instead of creating job insecurity and unemployment. Reduction of necessary work time is central to the Marxist concept of human freedom and overcoming alienation, a concept widely shared by Marxist and non-Marxist socialists alike. Socialization as
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#17327724275721606-569: Is entrusted exclusively to state agents, then it is liable to bureaucratization; if it is entrusted exclusively to workers, then it is liable to monopoly power and abuse of market position. Cooperative ownership is said to give rise to a socialization dilemma faced by advocates of cooperatives: if social ownership is entrusted to subgroups within society, resources may not be distributed according to broad social need. Cooperatives which operate within markets may particularly face this issue if they compete . It's been argued that common ownership can fall to
1679-489: Is heavily influenced by the Marxian analysis of capitalist property forms as part of its broader critique of alienation and exploitation in capitalism. Although there is considerable disagreement among socialists about the validity of certain aspects of Marxian analysis, the majority of socialists are sympathetic to Marx's views on exploitation and alienation. Socialists critique the private appropriation of property income on
1752-439: Is not socialist as it can exist under a wide variety of different political and economic systems . State ownership by itself does not imply social ownership where income rights belong to society as a whole. As such, state ownership is only one possible expression of public ownership, which itself is one variation of the broader concept of social ownership. The social ownership of capital and corporate stock has been proposed in
1825-483: Is practiced in many of the high-technology companies of Silicon Valley . The earliest model of cooperative socialism is mutualism , proposed by the French anarchist philosopher Pierre-Joseph Proudhon . In this system, the state would be abolished and economic enterprises would be owned and operated as producer cooperatives, with worker-members compensated in labor vouchers . The model of market socialism promoted in
1898-506: Is promoted as a solution to what its proponents see as being inherent issues to private ownership. Market socialists and non-market socialists therefore have slightly different conceptions of social ownership. The former believe that private ownership and private appropriation of property income is the fundamental issue with capitalism, and thus believe that the process of capital accumulation and profit-maximizing enterprise can be retained, with their profits being used to benefit society in
1971-417: Is the organization of economic units into enterprises owned by their workforce ( workers cooperative ) or by customers who use the products of the enterprise (this latter concept is called a consumer cooperative ). Cooperatives are often organized around some form of self-management, either in the form of elected managers held accountable to the workforce, or in the form of direct management of work processes by
2044-614: Is the process of transforming privately owned assets into public assets by bringing them under the public ownership of a national government or state . Nationalization contrasts with privatization and with demutualization . When previously nationalized assets are privatized and subsequently returned to public ownership at a later stage, they are said to have undergone renationalization . Industries often subject to nationalization include telecommunications , electric power , fossil fuels , railways , airlines , iron ore , media , postal services , banks , and water (sometimes called
2117-401: Is the seizure of private property by a public agency for a purpose deemed to be in the public interest. It may also be used as a penalty for criminal proceedings. Expropriation differs from eminent domain in that the property owner is not compensated for the seized property. Unlike eminent domain, expropriation may also refer to the taking of private property by a private entity authorized by
2190-658: The First World War . However, there were three schemes in total: Carlisle and Gretna , Cromarty Firth , and Enfield . In 1921 Carlisle and Gretna was split into two separate areas. Carlisle was the larger part and supplied some beer to Gretna. In 1922 the Enfield scheme ended and its public houses were sold back to private enterprise. The scheme was privatised by Edward Heath 's Conservative Government in 1971 and its assets were sold at auction in six lots, mostly to established brewing interests. A central pillar of
2263-451: The commanding heights of the economy ), and in many jurisdictions such entities have no history of private ownership. Nationalization may occur with or without financial compensation to the former owners . Nationalization is distinguished from property redistribution in that the government retains control of nationalized property . Some nationalizations take place when a government seizes property acquired illegally. For example, in 1945
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2336-420: The tragedy of the commons , or be difficult to broadly implement prior to upper-stage communism . Additionally, there are two major forms of management or "social control" for socially owned organizations, both of which can exist alongside the two major modes of social ownership. The first variant of control is public management, where enterprises are run by management held accountable to an agency representing
2409-494: The workers themselves . Traditionally, social ownership implied that capital and factor markets would cease to exist under the assumption that market exchanges within the production process would be made redundant if capital goods were owned and integrated by a single entity or network of entities representing society. However, the articulation of models of market socialism where factor markets are utilized for allocating capital goods between socially owned enterprises broadened
2482-595: The 1960s and 1970s, followed by an increase in privatization in the 80s and 90s, followed again by an increase in nationalization in the 2000s and 2010s. The term appears as "expropriation of expropriators ( ruling classes )" in Marxist theory , and also as the slogan "Loot the looters!" ("грабь награбленное"), which was very popular during the Russian October Revolution . The term is also used to describe nationalization campaigns by communist states , such as dekulakization and collectivization in
2555-544: The British Labour Party . In the United States, potentially nationalizing healthcare is often a topic of political disagreement and makes frequent appearances in debates between political candidates. A 2020 poll shows that a majority (63%) of Americans support a nationalized healthcare system. A re-nationalization occurs when state-owned assets are privatized and later nationalized again, often when
2628-404: The French government seized the car-maker Renault because its owners had collaborated with the 1940–1944 Nazi occupiers of France . In September 2021, Berliners voted to expropriate over 240,000 housing units , many of which were being held unoccupied as investment property. Economists distinguish between nationalization and socialization , which refers to the process of restructuring
2701-578: The May 1949 issue of the Monthly Review titled " Why Socialism? ", Albert Einstein wrote of a broad definition involving economic planning : I am convinced there is only one way to eliminate [the] grave evils [of capitalism], namely through the establishment of a socialist economy, accompanied by an educational system which would be oriented toward social goals. In such an economy, the means of production are owned by society itself and are utilized in
2774-514: The USSR . However, nationalization is not a specifically socialist strategy, and Marxism's founders were skeptical of its value. As Engels put it: Therein precisely lies the rub; for, so long as the propertied classes remain at the helm, nationalisation never abolishes exploitation but merely changes its form — in the French, American or Swiss republics no less than in monarchist Central, and despotic Eastern, Europe. Nikolai Bukharin also criticised
2847-551: The clearest benefit of social ownership is an equalization of the distribution of property income, eliminating the vast disparities in wealth that arise from private ownership under capitalism. Property income (profit, interest and rent) is distinguished from labor income (wages and salaries) which in a socialist system would continue to be unequal based on one's marginal product of labor – social ownership would only equalize passive property income. Notable non-Marxist and Marxist socialist theorists alike have argued that
2920-522: The context of a market socialist system, where social ownership is achieved either by having a public body or employee-owned pension funds that own corporate stock . The American economist John Roemer developed a model of market socialism that features a form of public ownership where individuals receive a non-transferable coupon entitling them to a share of the profits generated by autonomous non-governmental publicly owned enterprises. In this model, "social ownership" refers to citizen ownership of equity in
2993-436: The defining characteristic of a socialist economy , and can take the form of community ownership , state ownership , common ownership , employee ownership , cooperative ownership , and citizen ownership of equity . Within the context of socialist economics it refers particularly to the appropriation of the surplus product produced by the means of production (or the wealth that comes from it) to society at large or
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3066-424: The definition to include autonomous entities within a market economy. The two major forms of social ownership are society-wide public ownership and cooperative ownership . The distinction between these two forms lies in the distribution of the surplus product . With society-wide public ownership, the surplus is distributed to all members of the public through a social dividend whereas with co-operative ownership
3139-487: The distribution of a critical mass of inputs and all outputs through information networks as free goods rather than commodities to be sold for profit by capitalist firms. The economist Pat Devine defines social ownership as "ownership by those who are affected by – who have an interest in – the use of the assets involved", distinguishing it from other forms of ownership. Devine argues that this variant of social ownership will be more efficient than
3212-528: The distribution of property income (wealth) in capitalism, but rather the Marxist case for socialism is based on a systematic analysis of the development and limits of the dynamic of capital accumulation. For Marx, social ownership would lay the foundations for the transcendence of the capitalist law of value and the accumulation of capital, thereby creating the foundation for socialist planning. The ultimate goal of social ownership of productive property for Marx
3285-408: The economic framework, organizational structure, and institutions of an economy on a socialist basis. By contrast, nationalization does not necessarily imply social ownership and the restructuring of the economic system . Historically, states have carried out nationalizations for various different purposes under a wide variety of different political systems and economic systems . Nationalization
3358-456: The economic surplus of an enterprise is controlled by all the worker-members of that specific enterprise. The goal of social ownership is to eliminate the distinction between the class of private owners who are the recipients of passive property income and workers who are the recipients of labor income (wages, salaries and commissions), so that the surplus product (or economic profits in the case of market socialism) belong either to society as
3431-417: The emerging school of neoclassical market socialism. Neurath's position opposed all models of market socialism because it rejected the use of money, but was also held in contrast with the more orthodox Marxist conception of socialism held by Karl Kautsky, where socialism only entails the elimination of money as capital along with super-session of the process of capital accumulation. Otto Neurath conceptualized
3504-527: The entire population rather than going largely to a class of inheriting rentiers . An alternative form of social ownership of equity is ownership of corporate stock through wage earner funds and pension funds. The underlying concept was first expounded upon in 1976 by the management theorist Peter Drucker , who argued that pension funds could reconcile employees' need for financial security with capital's need to be mobile and diversified, referring to this development as "pension fund socialism". In Sweden during
3577-457: The form of a social dividend . By contrast, non-market socialists argue that the major problems with capitalism arise from its contradictory economic laws that make it unsustainable and historically limited. Therefore, social ownership is seen as a component of the establishment of non-market coordination and alternative "socialist laws of motion" that overcome the systemic issues of capital accumulation. The socialist critique of private ownership
3650-457: The former Socialist Federal Republic of Yugoslavia was based on what was officially called "social ownership", involving an arrangement where workers of each firm each became members and joint-owners and managed their own affairs in a system of workers' self-management. Contemporary proponents of cooperative ownership cite higher motivation and performance in existing cooperatives. Critics argue that cooperative ownership by itself does not resolve
3723-431: The framework of a monetary market economy. Neurath's conception of socialism was the initial point of criticism of Ludwig von Mises in the socialist calculation debate . In the subsequent socialist calculation debates, a dichotomy between socialists emerged between those who argued that socialization entailed the end of monetary valuation and capital markets, and those who argued that monetary prices could be used within
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#17327724275723796-407: The grounds that because such income does not correspond to a return on any productive activity and is generated by the working class, it represents exploitation. The property-owning (capitalist) class lives off passive property income produced by the working population by virtue of their claim to ownership in the form of stock, bonds or private equity. This exploitative arrangement is perpetuated due to
3869-590: The late 1970s, the Meidner program was advanced by the Swedish Social Democratic Party as a way to socialize enterprises through employee wage earners' funds, which would be used to purchase corporate stock. Rudolf Meidner 's original plan was to require Swedish companies over a certain size to issue shares equal to 20 percent of profits, which would be owned by wage-earner funds controlled by employees through their trade unions. This plan
3942-476: The latter half of the 20th century who advocated public ownership highlighted the distinction between "control" and "ownership". John Roemer and Pranab Bardhan argued that public ownership, meaning a relatively egalitarian distribution of enterprise profits, does not require state control as publicly owned enterprises can be controlled by agents who do not represent the state. David McMullen's concept of decentralized non-market socialism advocates social ownership of
4015-431: The means of production emerges in response to the contradictions between socialized production and private appropriation of surplus value in capitalism. Marx argued that productivity gains arising from the substitution of variable capital (labor inputs) for constant capital (capital inputs) would cause labor displacement to outstrip the demand for labor. This process would lead to stagnant wages and rising unemployment for
4088-443: The means of production, believing it to be far more efficient than private ownership. In his proposal, property titles would be replaced by "usership" rights and the exchange of capital goods would no longer be possible. Market exchange in capital goods would be replaced by internal transfers of resources, but an internal and decentralized price system would be fundamental to this systems' operation. However, by itself public ownership
4161-420: The most significant argument for social ownership of the means of production is to enable productivity gains to ease the work burden for all individuals in society, resulting in progressively shorter hours of work with increasing automation and thus a greater amount of free time for individuals to engage in creative pursuits and leisure. Social ownership is contrasted with the concept of private ownership and
4234-770: The motivations of the nationalizing party. Nationalization was employed towards the Panama Canal by the Panamanian Government, which came under the Panama Canal Authority in 1999, to internationally positive effect. Likewise, the Suez Canal was nationalized multiple times throughout history. In Germany, the Federal Press [ Bundesdruckerei ] was nationalized in 2008 with positive revenue and net income since. Expropriation
4307-434: The nationalization of key services such as water, bus, railways and broadband in the United Kingdom could save £13bn every year. Nationalization may produce other effects, such as reducing competition in the marketplace, which in turn reduces incentives to innovation and maintains high prices. In the short run, nationalization can provide a larger revenue stream for government but may cause that industry to falter depending on
4380-525: The new premises were designed by the scheme's chief architect, Harry Redfern in his New Model Inn style, which influenced the design of public houses in the rest of the UK. This article related to government in the United Kingdom or its constituent countries is a stub . You can help Misplaced Pages by expanding it . Nationalisation Nationalization ( nationalisation in British English )
4453-408: The part of individuals and organizations, thirdly social ownership would eliminate unemployment, fourth it would enable the better flow of information within the economy, and finally it would eliminate wasteful activities associated with "wheeling and dealing" and wasteful government activities intended to curb such behavior and deal with unemployment. From a non-Marxist, market socialist perspective,
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#17327724275724526-419: The public either at the level of national, regional or local government. The second form of social control is worker self-management , where managers are elected by the member-workers of each individual enterprise or enterprises are run according to self-directed work processes. The exact forms of social ownership vary depending on whether or not they are conceptualized as part of a market economy or as part of
4599-429: The scheme was the ethos of disinterested management: public house managers had no incentive to sell liquor, which supported the aim of reducing drunkenness and its effects on the arms industry. From 1916 to 1919 the scheme had a "no treating" policy, forbidding the buying of rounds of drinks . The scheme also involved the refurbishment of public houses, and the demolition and replacement of substandard premises. Most of
4672-439: The structural issues of capitalism like economic crises and the business cycle, and that cooperatives have an incentive to limit employment in order to boost the income of existing members. In the context of non-market proposals, social ownership can include holding the means of producing wealth in common ( common ownership ), with the concept of "usership" replacing the concept of ownership. Commons-based peer production involves
4745-408: The structure of capitalist society. From this perspective, capitalism is regarded as class system akin to historical class systems like slavery and feudalism. Private ownership has also been criticized on ethical grounds by the economist James Yunker. Yunker argues that because passive property income requires no mental or physical exertion on the part of the recipient and because its appropriation by
4818-472: The surplus product (or economic profits) generated by enterprises accrues to society more broadly than executives – state ownership neither necessarily implies nor rejects this. There are a few major forms of "social ownership": Each of these forms have flaws or weaknesses that can be critiqued by anti-socialism advocates. Public ownership is said to give rise to a socialization dilemma faced by advocates of public ownership: if social ownership
4891-452: The term nationalisation , preferring the term statisation instead. |Fred Moseley]] in Dollars & Sense , January/February 2009 Socialization (economics) Social ownership is a type of property where an asset is recognized to be in the possession of society as a whole rather than individual members or groups within it. Social ownership of the means of production is
4964-527: The use of energy and time units, the latter being viewed as the standard cardinal unity of measurement for socialist calculation. These thinkers belonged to a technical school of thought called "scientific utopianism", which is an approach to social engineering that explores possible forms of social organization. The most notable thinker belonging to this school of thought was the Viennese philosopher and economist Otto Neurath , whose conception of socialism as
5037-436: The workers themselves. Cooperatives are often proposed by proponents of market socialism, most notably by the economists Branko Horvat, Jaroslav Vanek and Richard Wolff . Cooperative ownership comes in various forms, ranging from direct workers' ownership, employee stock ownership plans through pension funds, to the weakest version involving profit sharing. Profit-sharing and varying degrees of self-management or " Holacracy "
5110-424: The working class alongside rising property income for the capitalist class, further leading to an over-accumulation of capital . Marx argued that this dynamic would reach a point where social ownership of the highly automated means of production would be necessitated to resolve this contradiction and resulting social strife. Thus the Marxist case for social ownership and socialism is not based on any moral critique of
5183-436: Was one of the major mechanisms advocated by reformist socialists and social democrats for gradually transitioning to socialism. In this context, the goals of nationalization were to dispossess large capitalists, redirect the profits of industry to the public purse, and establish some form of workers' self-management as a precursor to the establishment of a socialist economic system. Although sometimes undertaken as part of
5256-431: Was rejected and a watered-down proposal was adopted in 1984, which left corporate decision making just as it was and limited the scope of employee ownership to less than 3.5% of listed company shares in 1990. In his 2020 United States Presidential campaign, Bernie Sanders proposed that 20% of stocks in corporations with over $ 100 million in annual revenue be owned by the corporation's workers. Cooperative ownership
5329-642: Was to expand the "realm of freedom" by shortening average work hours so that individuals would have progressively larger portion of their time to pursue their genuine and creative interests. Thus the end goal of social ownership is the transcendence of the Marxist concept of alienation. The economist David McMullen identifies five major benefits of social ownership, where he defines it as society-wide ownership of productive property: first, workers would be more productive and have greater motivation since they would directly benefit from increased productivity, secondly this ownership stake would enable greater accountability on
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