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Mixed State-and-Private Enterprise

Before you read

Discuss these questions:

1. What enterprises are state?

2. What enterprises are private?

3. What are mixed state-and-private enterprises?

Now read the article. What does it say about the questions above?

Standing between the extremes of free enterprise and central state control is another type of socioeconomic system that combines some elements of both of those systems. Not all, but some portion of the industrial and financial sectors is owned and operated by the government. This may include the central bank through which the country’s overall monetary policies are determined; the railroads, bus lines, and gas companies; and basic industries such as steel, auto manufacturing, coal mining, nuclear power, and health care.

In spite of these government-controlled business activities, many mixed systems provide opportunities for private sector business activity. These private businesses compete alongside the state enterprises and transact business according to free market principles; they make profits for their owners or stockholders, serve consumers, and face the normal business of failure if the market does not value their product and services.

This type of socioeconomic system is popular in many parts of the world. Countries have developed economies with a mixture of private and state-owned businesses. These countries tend to provide a degree of economic and political freedom far greater than the central state control systems. Political elections are open and free, and the social system tends to be pluralistic and diverse. However, when compared with free enterprise systems, the amount of market freedom is considerably less.

As with all socioeconomic systems, the benefits and costs need to be balanced against each other in judging the system’s effectiveness. Japan and the former West Germany have achieved spectacular economic growth and productivity rates through such mixed state-and-private enterprise systems. However, their record of social problem solving has not always matched their economic performance. Both countries have had serious environmental pollution problems, a consequence of state policies that permitted “dirty” industries to operate with less than state-of-the-art technologies to control emissions.


Reading tasks

A. Read the text in more detail and answer the following questions:

1. What types of enterprises are there?

2. How many enterprises are state owned?

3. Which are they?

4. What principles do private businesses follow?

5. What is the purpose of developing a mixture of private and state-owned businesses?

6. What problems does Japan have?



B. Which of the following statements are false according to the article?

1. Mixed state-and private enterprise is one of the types of socioeconomic system.

2. The government owns and operates some portion of the financial sectors.

3. The central bank is operated by mixed state-and-private business.

4. The basic industries are controlled by the government.

5. Private businesses follow free market principles.

6. Private business is not popular in many countries.

7. Mixed state-and-private enterprise systems do not ensure economic growth and productivity rates


Vocabulary tasks

A. Complete the following sentences using words from the box:

Activity costs free bank owned pluralistic


1. Some industrial and financial sectors are __________by the government.

2. The country’s overall monetary policies are determined by the central _________.

3. Mixed businesses provide opportunities for private sector business _________.

4. Private businesses transact business according to _______market principles.

5. The social system tends to be _________ and diverse.

6. The benefits and ________ need to be balanced against each other in judging the system’s effectiveness.

B. Match the verbs and nouns as they are used in the text:

1. ñombine a. business
2. determine b. economies
3. provide c. performance
4. transact d. consumers
5. make e. policies
6. serve f. product
7. develop g. growth
8. achieve h. elements
9. match i. profits
10. value j. opportunities

C. Use the appropriate preposition:

1. Sectors owned ____ the government.

2. Make profit ____ their stockholders.

3. Popular ____ many countries.

4. Economies ____ a mixture of business.

5. Tend ____ provide freedom.

6. Compared ____ free enterprise systems.

7. Achieve ____ mixed enterprise systems.

8. A consequence ____ state policies.

9. To operate ____ technologies.

10. Transact business ____ ____ free market principles.


Student A Speak about advantages of free types of socioeconomic systems.   Student B Speak about disadvantages of free types of socioeconomic systems.

Unit 11

Date: 2016-04-22; view: 943

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