A Socialist economic system is based on a social ownership of production and co-operative management of the economy. Social ownership may refer to cooperative enterprises, common ownership, state ownership, citizen ownership of equity, or any combination of these. These combinations differ in the type of social ownership every country want to advocate, the degree to which they rely on markets or planning, how management is to be organized within productive institutions, and the role of the state in constructing socialism.
Analyzing the Socialist economic system’s principle, production for use, I would like to compare two socialist’s countries: China and Cuba. Despite having socialist economies these countries have more differences than similarities between them.
Republic of China has been reformed it economy from a Soviet-style centrally planned economy to a market-oriented mixed economy under one-party rule. Today China is mainly characterized as having a market economy based on private property ownership. Its government still dominates energy production and heavy industries, but private enterprise has around 30 million private businesses. It belongs to First World Countries.
In other hand, the economy of Cuba is largely state-controlled planned economy. Most of the means of production are owned and run by the government and most of the labor force is employed by the state. There are a few cooperatives and self-employment. They have been encouraged by the Communist Party. Cuba belongs to Third World Countries.
In my opinion in a socialist economic system the role of the state or its leaders in making good decisions for successful economic system is the base for prosperity country.