In this article we take a look at 15 socialist countries that have been successful. You can skip our detailed analysis of the state of socialism and go straight to5 Socialist Countries That Succeeded.
Socialism is an economic theory that emphasizes ownership of the means of production by society and not by individuals. The central essence or principle of socialism is to shape society on the basis of cooperation and welfare and not on market capitalist competition and "exploitation".This is the classic definition of socialism. In practice, however, it is ill-defined, subjective, and encompasses a whole range of different economic policies, and even co-exists in some countries with capitalism through a so-to-speak pragmatic approach to socialism.
It is believed that socialismimpedeInnovation because it is believed to remove the incentive to innovate as society loses its competitive advantage due to collective ownership of the means of production rather than individual and private ownership. The assumption is based on Adam Smithtreated: An inquiry into the nature and causes of the wealth of the nations where capitalism finds its roots.The assumption emphasizes that people are rational agents who want to create and increase wealth and are primarily driven by this drive. That leads tosupposed benefitsfor a free market economy and for society as a whole as people compete to generate wealth and innovate in their respective niches to stay ahead of the competition.
Capitalists believe that Western advances in technology and other sophisticated services are primarily the result of capitalism. However, in some Western countries, particularly the US, people are moving away from this dominant economic philosophy.According to a bankpollSince 2010, only 29% of Americans have responded positively to the word "socialism," but as of 2019, 42% of Americans have developed positive views of socialism, according to the latest Bank.poll.These polls also show that Democratic Party voters, most of whom are young people, make up the majority of people who are positive about socialist theory.
Joe Biden's arrival in the White House also ushered in an era that was expected to see pro-left politics, including severe restrictions on big companies and giants like Amazon.com, Inc. (NASDAQ:AMZN), Facebook, Inc Common Stock (NASDAQ: FB), Alphabet Inc Class A (NASDAQ: GOOGL), Tesla Inc (NASDAQ: TSLA), Twitter Inc (NYSE: TWTR) and Apple Inc (NASDAQ: AAPL). President Biden's pick for FTC chair: Leena Khan, a harsh critic of tech companies whocreedMarkets in the US are "controlled by a very small number of companies": notes the policy tech companies should expect from the new administration.
When respondents who viewed socialism positively were asked why they preferred it, the majority replied that socialism ensures a fair distribution of resources and brings about equality.Although most Americans still favor capitalism according to these polls, most have gotten pretty thin.The growing alienation of capitalism in the US has been attributed to a number of factors, including growing wealth inequality, job insecurity and inadequate social safety nets.
According to an inequality.orgMessage, the richest 1% of Americans have four times more wealth than the poorest 50%. The same report also notes the impact of the Covid-19 pandemic on disproportionate wealth in the US, with the wealthiest 1% seeing a 29% increase in wealth while millions of people lost their jobs in just the first 6 months of the pandemic.
But does socialist politics solve these problems? And if so, is that at the expense of innovation? Can a capitalist economy modified with the principles of socialism end the evils of both? The answer is not a clear yes or no. Many countries have experimented with different versions of socialism with different degrees of politics, with different results.
No country has ever experienced pure socialism for structural and practical reasons. The only state that came close to socialism was the Soviet Union, and it had both dramatic successes and dramatic failures in terms of economic growth, technological advancement, and prosperity. In the end, however, the state collapsed.Other experimenters like Kuba only improved in very narrow areas like health. On the other hand, some countries with higher luck values, like Sweden and Norway, are thrivingdemocratic socialism.
Democratic socialism emphasizes the need for a democratic society that retains a competitive capitalist market but is complemented by socialism's "ethical" economic ideals, and while the term democratic socialism is used synonymously with social democracy due to socio-political structures of identical economics. The latter theory advocates the transition to socialism through a gradual, non-revolutionary reform of existing social structures. (O'Hara, 2003)
Most people believe that China is a purely socialist country, which is not true. China practices state capitalism, but has incorporated its model into some socialist and some experimental policies. However, Chinese President Xi Jinpinghe hasthat by 2050 China will have made a full transition to socialism.Most countries simply adapted or modified socialist policies to work with their economic model. We would then analyze different countries with their different models that have adapted to socialism in their own way.
A successful socialist-oriented country can be defined as one that has adopted socialist policies and benefited from them without losing anything. In this case, it means that economic growth has not slowed, the welfare system has improved, and the wealth gap has narrowed. Below we have outlined a list of 15 “socialist” countries that have succeeded, and we have also looked at the extent of socialism in their economic models.
Photo ofEgor MizniknoUnsplash
For our list of the 15 successful socialist countries we have defined 4 indicators: Innovation Index, Social Progress Index, Global Competitiveness and Gini Coefficient Index.Innovation, as discussed above, is the extent to which country markets engage in the innovation of products and services to solve new problems and thereby grow economies. The higher the innovation value, the higher the level of innovation in the economy. However, this is only possible in free markets, so our focus is on socialist countries with a free market economy.
The Social Progress Index measures government policies in response to the social and economic well-being of its citizens, which includes services such as health care, minimum wage and parental leave, etc. A high score in the Social Progress Index means a socialist welfare system in the state. The Global Competitiveness Index measures the level of competence and competitiveness of an economy on the world stage.
The Gini coefficient index, on the other hand, measures the distribution of income in a population and the difference in wealth.The higher the Gini coefficient, the greater the inequality🇧🇷 This coefficient was developed by the Italian statistician Corrado Gini.In order for socialist-oriented countries to be successful, there must therefore be a high innovation value, ie unrestricted innovation, a high social progress value, a good value for global competitiveness and a low Gini coefficient. These points are rated from 0 to 100.
For innovations we would usethe world economyResults from different countries. To measure social progress, we would useorganization of social progressResults. For global competitiveness, we would use results from theGlobal Competitiveness Reportand finally, for the Gini index of different countries, we would use the results ofRetrospective of the world population.However, since socialism is associated with a small wealth gap, we would use the Gini coefficient as the main metric.
This is a purely research-based article for educational purposes. Insider Monkey has no political affiliations and we do not use our content to promote any political ideology.
Now let's move on to the 15 socialist countries that made it.
Gini coefficient: 25.7
On our list of the 15 successful socialist countries, Moldova is the least significant. Moldova was a socialist republic in the Soviet Union, but after the collapse of the Soviet Union in 1991, Moldova became independent and joined the world economy.It began liberalizing its economy and privatized many state-owned companies. However, it has not completely eliminated the socialist experiment that still runs parallel to its liberal free market. Fine spirits are among the most important export goods.
After EquityIndexIn Economic Freedom 2021, Moldova scores just 50 out of 100 for financial freedom, while public spending and the tax burden rank 71st and 94th, respectively.This implies that the government is spending heavily on public services like health and education, while raising taxes on private wealth appears to be working in its favour.
Moldova has a high score of 72.58 for social progress but only 33 for innovation. It ranks 86th in global competitiveness.
Gini coefficient: 25.7
Armenia is another former Soviet republic on the list. The country became independent after the collapse of the Soviet Union, following the path of other former Soviet republics that were part of the Warsaw Pact.Market liberalization began and the privatization process began. Overall, however, the economy remains more centrally planned. Armenia developed a robust industrial sector during the Soviet era, but after its collapse, Armenia reverted to being mainly engaged in agriculture.
Armenia has not realized its true potential due to the growing threat of a conflict with Azerbaijan, with whom it has historical disputes that led to border disputes and the start of two wars, one of which was recently fought in 2020.Armenia scores well on Social Progress with a 76.46 but has an Innovation score of 32.60. It ranks 69th in global competitiveness.
Gini coefficient: 30.4
Another former Soviet republic that made the list of the 15 successful socialist countries is Croatia. Croatia was slow on economic reforms after the collapse of the Soviet Union.It liberalized its economy after the collapse of the Soviet Union. However, the transition to a market economy has only just begun and a significant part of the economy is still planned for social purposes. This has led to growth and narrowing of wealth inequality and inequality.Croatia scores 37.30 for innovation but scores high for social progress with 81.92. It ranks 63rd in global competitiveness.
Despite this, socialist countries have yet to experience the growth and innovation seen in purely capitalist countries like the US, where companies like Amazon.com, Inc. (NASDAQ:AMZN), Facebook, Inc. Common Stock (NASDAQ:FB), Alphabet Inc Class A (NASDAQ: GOOGL), Tesla Inc (NASDAQ: TSLA), Twitter Inc (NYSE: TWTR) and Apple Inc (NASDAQ: AAPL) are making tremendous technological advances.
Gini coefficient: 24.2
Slovenia is another country in Eastern Europe. It was part of Yugoslavia and gained independence in 1991 after Yugoslavia broke up into its constituent states. Slovenia has one of the lowest Gini coefficients, which means one of the lowest inequality rates in the world.
Slovenia's economy is therefore only moderately freeHerbsand it retains socialist elements in its economic policies, such as freedom to work. The state is also heavily involved in central planning and therefore the market is highly regulated.Slovenia has a moderate innovation score of 42.90. It has a high social progress score of 87.71 and ranks 35th in global competitiveness.
Gini coefficient: 33.8
Portugal is a country in Southern Europe famous for its seafood. It is a democratic socialist country. Portugal is known for its centre-left economic policies, regardless of who is in government.The right is relatively unpopular compared to the left because of its alliance with the organized working class in the country. To this day, the Socialist Party in Portugal, which was re-elected in 2019, is involved36%votes, a 4% increase over the previous election.
The Socialist Party implemented several left-leaning socialist policies over the course of 6 years, including reducing unemployment and increasing state welfare payments to citizens.Despite government spending, taxes and market regulation, Portugal's economy ranks 34th in the Global Competitiveness Index and has a moderate innovation score of 43.50. Portugal scores high in Social Progress with 87.79.
Despite this, companies like Amazon.com, Inc. are driving consumption and new technologies. (NASDAQ: AMZN), Facebook, Inc. Common Stock (NASDAQ: FB), Alphabet Inc Class A (NASDAQ: GOOGL), Tesla Inc (NASDAQ: TSLA), Twitter Inc (NYSE: TWTR) and Apple Inc (NASDAQ: AAPL) are becoming increasingly popular with the young population of Portugal.
Gini coefficient: 34.7
Located in southwestern Europe, Spain is a developed country. Spain is a democratic socialist state. Left-wing politics is popular in the country. Spain has an innovation index of 45.60, a global competitiveness index of 75.3 and social progress of 88.71.Some of the largest listed companies in Spain includeRepsol, S.A. (MCE: REP.MC), Banco Santander, S.A. (NYSE:SAN), Mapfre, S.A. (MCE: MAP.MC) and Telefónica, S.A. (NYSE:FET).
Gini coefficient: 27.4
Belgium is a country in Western Europe. It is a democratic socialist country with a very high level of development. It ranks 22nd in global competitiveness, has a Decent Innovation Index of 49.10 and a Social Progress Score of 89.46.Belgium's economy focuses on a number of key factors. The market is free, but the tax burden is relatively high due to public spending on health and other social services.
Despite this, Europe lacks innovation and technological advances like the US. Almost all of the major companies working on key technologies are based in the US, including Amazon.com, Inc. (NASDAQ: AMZN), Facebook, Inc. (NASDAQ: FB), Alphabet Inc Class A (NASDAQ: GOOGL), Tesla Inc. (NASDAQ:TSLA), Twitter Inc (NYSE:TWTR) and Apple Inc (NASDAQ:AAPL).
Gini coefficient: 32.8
The Republic of Ireland is a Baltic country in northwestern Europe. It ranks eighth on our list of the 15 successful socialist countries. It is a democratic socialist country with an innovation score of 53, a global competitiveness ranking of 24 and a social progress score of 90.35. The economy is mixed with a free market and huge public welfare spending.
Gini coefficient: 28.5
The Netherlands are in north-western Europe. It has a significant number of socialist structures. The economy is mixed and the market enjoys important degrees of freedom, but there are socialist-oriented regulations. For example, young people earn less than older peopleetuc.org.
There is a robust healthcare system. Policies have been put in place in the marketplace for parents to adoptI payLeave during pregnancy or childbirth. Minimum wages were introduced in the country to prevent people from sliding into poverty.The Netherlands has a high innovation score of 58.80. It ranks fourth in the global competitiveness index and has a high social progress score of 91.06.
Some of the largest publicly traded companies in the Netherlands includeAirbus SE (EPA: AIR.PA), Royal Dutch Shell plc (AMS: RDSA.AS), Exor N.V. (BIT: EXO.MI), Koninklijke Ahold Delhaize N.V. (AMS: AD.AS) und ING Groep N.V. (AMS: INGA. AS).
Gini coefficient: 38.5
Without a doubt, China ranks high in the list of the 15 socialist countries that have thrived despite a relatively higher Gini coefficient, less innovation and social progress than some other countries on the 15-nation list for many reasons. got.China takes first place for two reasons: the speed with which it has climbed the economic ladder to become the world's second largest economy, and its closeness to traditional socialism.
The People's Republic of China was almost entirely socialist until it opened its economy to the rest of the world in the late 1970s. China has a one-party system based on meritocracy and long-term strategic and experimental economic planning.The socialist pillars in China's socio-political and economic system include unemployment insurance, workers' compensation insurance, universal health care, and municipal pension funds.
China is not a market economy in the sense of free market capitalism or market socialism. Instead, China relies on strategic state capitalism, in which it controls how the strategic means of production are deployed.The reason is the gradual transition from this phase to a fully socialist system through a meritocratic and welfare-oriented political system in what is commonly referred to as the China model or China model.Beijing consensus.
An impressive achievement of this policy is that China has grown800 millionits population out of poverty, according to the World Bank. China has an innovation score of 53.50. He has a social progress score of 66.12.China is also home to the third largest smartphone maker Xiaomi Corporation (OTC: XIACF) when it comes to innovation.
China ranks 28th in global competitiveness and is home to several listed giants such as Alibaba Group Holding Limited (HKSE: 9988.HK), Tencent Holdings Limited (HKSE: 0700.HK), Pinduoduo Inc. (NASDAQ:DPD), Yum China Holdings Inc. (NYSE:YMC), Xiaomi Corporation (OTC: XIACF) und New Frontier Health Corporation (NYSE:NFH).133 Chinese companies made the Fortune 500 list in 2020. Some of them are Alibaba Group Holding Limited (HKSE: 9988.HK), Tencent Holdings Limited (HKSE: 0700.HK) and Xiaomi Corporation (OTC: XIACF).
Chinese companies are also competing with American giants such as Amazon.com, Inc. (NASDAQ: AMZN), Facebook, Inc. Common Stock (NASDAQ: FB), Alphabet Inc Class A (NASDAQ: GOOGL), Tesla Inc (NASDAQ: TSLA), Twitter Inc (NYSE: TWTR) and Apple Inc (NASDAQ: AAPL) in all areas.
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Disclosure: none.15 Socialist Countries That Succeededwas originally published on Insider Monkey.
What are some successful socialist countries? ›
|People's Republic of China||1 October 1949||Communist Party of China|
|Republic of Cuba||24 February 1976||Communist Party of Cuba|
|Lao People's Democratic Republic||2 December 1975||Lao People's Revolutionary Party|
|Socialist Republic of Vietnam||2 September 1945||Communist Party of Vietnam|
- Egypt (1952–1973)
- Syria (1955–1961, 1963–1991)
- Iraq (1958-1963, 1968-1991)
- Guinea (1958–1978)
- Mali (1960–1991)
- Somali Democratic Republic (1969–1977)
- Algeria (1962–1991)
- Burma (1962–1988)
Examples of countries directly using the term socialist in their names include the Democratic Socialist Republic of Sri Lanka and the Socialist Republic of Vietnam while a number of countries make references to socialism in their constitutions, but not in their names. These include India and Portugal.What are some good examples of socialism? ›
Examples of socialism include public infrastructure, social security, public transportation, and fire protection services among others. The socialist ideology is widely visible in the US, even if we don't think about it every day, and even if we tend to think of the nation as being a bastion of capitalism.Has socialism ever been successful? ›
No country has ever experimented with pure socialism because of structural and practical reasons. The only state that had come the closest to socialism was Soviet Union and it had both dramatic successes and dramatic failures in terms of economic growth, technological advancement and welfare.Is Japan a socialist? ›
Japan's collective capitalism relies on cooperation, but ignores the fact that the means of production are private. It cannot be considered socialist because the means of production belongs to corporations.Is North Korea a socialist country? ›
According to Article 1 of the state constitution, North Korea is an "independent socialist state". It holds elections, though they have been described by independent observers as sham elections, as North Korea is a totalitarian dictatorship with a comprehensive cult of personality around the Kim family.What are the 8 types of socialism? ›
- 5.1 Utopian socialism.
- 5.2 Communism.
- 5.3 Marxism. 5.3.1 Leninism and Marxism–Leninism. 5.3.2 Stalinism. ...
- 5.4 Anarchism. 5.4.1 Mutualism. 5.4.2 Collectivist anarchism. ...
- 5.5 Democratic socialism. 5.5.1 Social democracy.
- 5.6 Eco-socialism. 5.6.1 Green anarchism.
- 5.7 Liberal socialism. 5.7.1 Ethical socialism.
- 5.8 Libertarian socialism.