Economy

(1) The aggregate of production relations, or the economic basis of society. The scientific definition of the economy and of its place in the development of society was first given by K. Marx: “The aggregate . . . of production relations constitutes the economic structure of society, the actual base upon which the legal and political superstructure is erected and which has its particular corresponding forms of social consciousness” (K. Marx and F. Engels, Soch., 2nd ed., vol. 13, pp. 6–7). The economy forms the basis of all other social relations and plays the decisive role in the development of society.
The economy is the system of production relations in any mode of production. The determining relations in this system are those pertaining to the ownership of the means of production and the character and social means of linkage between the direct producers and the means of production. The aggregate of production relations of a given mode of production is expressed in the corresponding system of economic laws and categories of political economy. Each mode of production has its own characteristic economy with its own distinct type of ownership, objectives, and forms and methods of management—as in the case of the primitive communal system, slavery, feudalism, capitalism, and communism. Economics directly interacts with politics, a component of which is economic policy.
(2) The national economy of a given country or a given part of the economy including the corresponding branches and types of production. The national economy reflects not only the characteristic features of a given mode of production but also the distinguishing features of a given country stemming from such specific historical conditions as its geographic location, the part it plays in the international division of labor, its historical traditions, and the level of development of its productive forces.
The economy includes the branches of material production (such as industry, agriculture, construction, transport, and trade) and the nonproduction sphere (including education, health care, and culture). Social production is subdivided into (1) production of the means of production and (2) production of consumer goods. The relationship between the two subdivisions is influenced by various factors, with the first subdivision playing the decisive role as the basis of technological progress.
The economy of the USSR is a single national economic aggregate that encompasses all the elements of social production, distribution, and exchange throughout the country. It is based on large-scale mechanized production in all branches of the national economy and is developed on a planned basis for the benefit of the people’s increasing well-being. The USSR has built an advanced socialist society. In its present stage, socialism is already developing on its own basis, and the full creative powers of the new system are increasingly revealed. The greater division of labor and more proportional development of the various branches and regions are creating the necessary conditions for consistent growth in the efficiency of all social production and for fuller utilization of natural and labor resources.
The entry of socialism into the world arena led to the emergence of the economy of the world socialist system. The chief trends in the development of this system are the growing extent of socialist economic integration, the increasing convergence of the national economies of the various socialist countries, and the establishment of far-reaching and stable bonds linking together the main branches of the economy and of science and technology.
===REFERENCES===
See references under ECONOMICS.
Category:Economics