State Capitalism

Summary of State Capitalism

The ownership and operation of business enterprises by agencies of government. Unlike Marxism, which espouses state ownership of the means of production, state capitalism is not necessarily motivated by ideological consideration; a particular economic enterprise may be run by the state because it is unattractive to private enterprise but viewed as necessary. In many cases an enterprise may be operated as a means of generating state revenue. In developing countries, state capitalism often reflects ownership of basic industries because private capital is inadequate to fund infant industries or does not perceive a sufficiently attractive return.

(Main Author: William J. Miller)