What Is the Role of Competition in a Market Economy?

The market mechanism is a way of allocating resources through market competition, that is, a mechanism for realizing the allocation of resources in the market through free competition and free exchange, and is also a form of realization of the law of value. Specifically, it refers to the interrelationship and action mechanism of factors such as supply and demand, price, competition, and risk in the market mechanism. There are general and special market mechanisms. The general market mechanism refers to a market mechanism that exists and functions in any market, and mainly includes supply and demand mechanism, price mechanism, competition mechanism and risk mechanism. Specific market mechanisms refer to specific and unique market mechanisms in various markets, including interest rate mechanisms in the financial market, exchange rate mechanisms in the foreign exchange market, and wage mechanisms in the labor market.

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The market mechanism is a method of allocating resources through market competition, that is, resources passing through the market

Because in real economic life, it is difficult to meet the conditions that are strictly assumed by a completely competitive market, take a step back and say that even if these conditions are met, the market mechanism can be realized

(One)

(A) advantages

Compared with the planning system, the market mechanism has the following advantages,

1. The response of the market mechanism is relatively agile, and the market mechanism is almost infinite.

Market mechanism is the core content of "market economics".

Market economics is a huge discipline system composed of a series of "market XX" branches. For example: "market mechanism", "market finance", "market allocation", "market investment", "market management", "marketing", "market system", and so on. Related are "market politics", "market sociology", and so on.