What is the relationship between market economy and law?

Taking the development of socialist market economy and the sound construction of socialist legal system as the theme, and taking the situation that China has just joined the WTO as the background, we try to discuss the relationship between the construction of socialist legal system in China and the socialist market economy with Chinese characteristics. Practice makes us soberly see that joining the WTO has brought us good opportunities for development as well as serious challenges. Strengthening the construction of the legal system is of great significance to the establishment and protection of the socialist market economy system. The reform practice in the past twenty years can be said to be a course of ideological emancipation centering on the issue of market economy. A market economy essentially requires the use of law to regulate and adjust economic relations and to promote the development of the productive forces of society. A market economy without the rule of law is inconceivable. Without sound, supporting legal safeguards, the new system of socialist market economy cannot be fundamentally established. Key Words: Market Economy, Legal System Construction As an operating mechanism of the national economy, the market economy, regardless of what social system exists, operates according to its own rules and order. The establishment of these rules and order is based on a complete legal system, especially after China's accession to the WTO, for domestic and foreign enterprises to create a unified, stable, transparent and predictable legal environment to protect the enterprise in an open, just and fair environment to participate in market competition is particularly important. Practice makes us soberly see that joining the WTO brings us good development opportunities, but also brings serious challenges. Strengthening the legal system is of great significance in establishing and safeguarding the socialist market economy system. The reform practice over the past two decades can be said to be a process of ideological emancipation centered on the issue of market economy. A market economy essentially requires the use of law to regulate and adjust economic relations and to promote the development of the productive forces of society. A market economy without the rule of law is inconceivable. Without sound, supporting legal safeguards, the new system of socialist market economy cannot be fundamentally established. I. Overview of Market Economy In 1992, China formally declared to the world the implementation of socialist market economy. This was not only a major breakthrough and leap in the theory and construction of socialism, but also a fundamental change in the system, for it meant that China got rid of the old model that had proved to be easily leading to the shrinkage or even failure of the socialist cause, and discovered a scientific path that suited its own national conditions and enabled the socialist cause to flourish. The so-called market economy, as opposed to the planned economy of the past, refers to an economic system that utilizes the market mechanism to achieve a rational allocation of resources and to motivate people to conserve economic resources in a commodity economy based on social mass production, which includes the free market economic system and the market economic system with macro-control and so on. (1) The socialist market economy is a new type of market economic system pioneered by China, which is different from the planned economies of socialist countries in the past, as well as from the various types of market economies of capitalist countries, but is a modernized market economy of socialized, intensive, and internationalized large-scale production armed with advanced technology, and is a market economy that is dominated by the public sector of the economy, with a wide variety of economic components coexisting, and that promotes efficiency and competition, and pursues justice and **. It is a market economy of a socialist nature with the public sector as the main economic component, the coexistence of various economic components, the promotion of efficiency and competition, and the pursuit of justice and ****same affluence. Second, the market economy and the relationship between the legal system construction of the market economy, although the main use of market mechanisms (price leverage and competition mechanism) to rationally allocate resources, the realization of the survival of the fittest, to promote the timely coordination of production and demand, but at the same time there are also its own insurmountable weaknesses and negative aspects, must be used in the application of laws and regulations and the necessary administrative governance, to strengthen and improve the state's macroeconomic control of the market, in order to guide the healthy development of the market economy. Healthy development. The establishment and development of the market economy in capitalist countries are inseparable from the establishment and improvement of the legal system of the capitalist market economy marked by the formulation of the Napoleonic Civil Code in 1804. Like other market economies, China's socialist market economy must be regulated, guided, constrained and safeguarded by laws that are compatible with it, and the prerequisite for the development of a socialist market economy is that a new legal basis, a new legal order and a new basic principle adapted to the needs of the market economy must be established through the legal system, so that it can be said that China's socialist market economy is in fact a market economy that is strictly in accordance with the laws embodying the will of the people and reflecting the socialist market economy. It can be said that China's socialist market economy is in fact an economy governed by the rule of law that operates strictly in accordance with the laws and regulations reflecting the will of the people and the laws of the socialist market economy, and the healthy development of the socialist market economy is inextricably linked to the construction of the socialist legal system, which is an intrinsic requirement of the objective law of market economy. (a) The establishment and development of the socialist market economy need to establish a new legal basis for the establishment and development of the socialist market economy is the negation of the planned economic system practiced in the past, these two very different economic systems rely on the legal basis is also very different. Adaptation to the planned economy needs by the state direct governance of the economy of the old legal basis, its prominent features: First, exclusion of the market, denial of the market subject, prohibit competition; Second, only talk about the ownership system and neglect to legal persons, natural persons of the right to respect and protection of property; Third, the denial of the autonomy of the meaning of the freedom of contract; Fourth, the state directly, the overall governance of the economy; Fifth, the state take over all, ignoring social security, and so on. What the market economy needs, however, is a completely new legal basis, which is characterized by the following: first, the system of qualification of market subjects. The primary condition for the development of the market is the existence of market participants who pursue their own interests, i.e., the legal subjects of market activities, therefore, the market economy needs to legally guarantee that qualified market subjects (i.e., legal persons who are independent of each other, of equal legal status, and of natural persons with full capacity for behavior and responsibility) are able to enter the market and participate in the competition with truly independent and equal qualifications. Secondly, the system of property rights should be fully respected and protected. The market not only needs to have subjects, but also must have property, to have the market subject's own property, so the market economy needs to fully respect and protect the property rights of market subjects by law. Thirdly, to maintain the system of freedom of contract. Only by adopting the form of contract to determine the relationship of rights and obligations between market subjects can they safeguard their mutually independent and equal legal status, so the legal system of contract constitutes the most important legal basis of the market economy. Fourth, the government's moderate intervention in the market system. Even modern capitalist countries can not be separated from the government's moderate intervention in the market, China's socialist market economy requires moderate government intervention and macro-control of the legal system, not only to avoid the spontaneity of the market economy may lead to a variety of abuse of the freedom of contract and other violations; and to overcome the government's overall direct governance of the economy of the old disadvantages. Fifth, a perfect social security system. The law of the market economy is fair competition, the survival of the fittest, breaking the system of the government to take care of everything, which is cruel and merciless to the laborers who fail in the competition as well as the groups who do not have the ability to compete and so on, is not conducive to the stability of the society, therefore, the market economy must establish a legal system of social security, to supplement the market economy of this defect. (2) It can be seen from this that a new legal basis adapted to the needs of the market economy must be established through the construction of the legal system before we can talk about the establishment and development of a socialist market economy, otherwise it is only an empty phrase. (B) the establishment and development of a socialist market economy needs to establish a new legal order in the past under the planned economy, the law is used to ensure that the completion of the national plan, that is to say, "plan is the law". But in the market economy, the spontaneity of the market and tendency to profit, inevitably bring many negative impacts, and this traditional legal order has been far from being able to solve these new problems faced by the market economy. Therefore, a new legal order corresponding to the needs of the market economy must be re-established before the socialist market economy can be truly established and developed. This new legal order of the market economy is the so-called fair and free competition legal order, which is characterized by the following: firstly, maintaining the unity of the market, breaking down the local protectionism, abolishing the artificial dismemberment and division of the market, and making the market economic activities of the whole country follow the unified laws and administrative regulations; secondly, maintaining the freedom of the market, and realizing the transformation of the enterprise management mechanism, the separation of government and enterprises, and the development of socialist market economy by formulating the necessary laws and regulations on the governance of the market economy. Secondly, the freedom of the market shall be maintained, and the conversion of the enterprise management mechanism, the separation of government and enterprises, and the moderate intervention of the state in market behavior shall be realized through the enactment of the necessary laws and regulations on market economy governance, weakening the various constraints and limitations imposed by administrative interventions on the market subjects, especially on the enterprises (including the constraints and limitations imposed by the competent authorities of the enterprises based on the relationship of administrative subordination; and the excessive interventions on the enterprises by the state authorities with the authority to govern the market), so as to enable market subjects to enjoy full autonomy of their own will; thirdly, the fairness of the market shall be maintained. Thirdly, to maintain the fairness of the market, to achieve the unity of the legal system, equal opportunities in market activities, and fairness in the national tax burden, etc., so as to ensure that all market players, regardless of whether they are natural persons or legal persons, large or small, strong or weak, and regardless of the nature of their ownerships, are able to compete with each other on an equal footing; and fourthly, to safeguard the competitiveness of the market, and to ensure, through the enactment of laws and regulations on anti-unfair competition and anti-monopoly, that all market players are able to compete with each other on the basis of the law and create a favorable environment for them to compete freely, etc. (3) the above planned economy and the market economy requires a very different legal order that, in order to establish and develop a socialist market economy, we must first change the old to adapt to the needs of the planned economy of the legal order, to establish a new legal order to adapt to the requirements of the market economy, and the establishment of a new legal order, can not be separated from the necessary legal system, or it can only be an empty word.