Environment friendly economy, Social market economy




Environment friendly economy, Social market economy


Key issue

Md. Jamal Hossain Buiyan

Today in Modern World Environment is the key issue.

Every Country of the World facing Environment degradation such as Air pollution, Water

pollution, Land pollution, Global warming, Climate change.

To solve all problem finance is the most important factor for poor Country.

A solid based Economic System can play vital role to way out from Environment degradation.

Germany , World richest country fighting against Environment degradation through there healthy

economy which called "Social Market Economy" one of the best known International Trade

Mark. Mr. Ludwig Erhard who was determined to shape a new kind of German economy.


The concept of the social market economy was developed by Ludweg Erhard, together with Alfred Mullar-Armack. Erhard, who served from 1949-1963 as the first Economics Minister of the Federal Republic of Germany, was a proponent of Ordoliberalism -school of economic liberalism that also accorded a key role to the state. The fundamental principle of ordoliberalism is the protection of all participants on both the supply and demand side. Erhard's colleague Muller-Armack who headed the Economics Ministry's Director General for fundamental issues of economics policy starting in 1952 and then became State Secretary for European policy in1958, was the first person put the term "Social market economy " in writing. He described the "Social market economy " as a form of market economy that-in contrast to a laissez-fare market economy-is internationally managed in accordance with social priorities.


  Legal basis

The term "Social market economy " was never specifically named in Germany 's constitution as the country economic system, because the constitution does not contain a separate section on the economy. Nevertheless, central elements in Germany's legal system-including its basic rights, the freedom of association and contractual freedom, and the freedom to choose a profession and place of employment-lay the foundations for the social market economy and exclude extremes such as a centrally planned economy or an unfettered market economy.

In may 1990, the Treaty establishing a monetary, Economic and Social Union between the Federal Republic of Germany and the former German Democratic Republic set forth in law that the social market economy constitutes Germany 's common economic order.

Since the mid-20 th century, Germany 's economic policy has been based on the concept of the social market economy (soziale Marktwirtschaft) . The central idea of this concept is to maintain the mechanisms of the free market while simultaneously ensuring social equity.

  Social market economy

Market mechanisms function by balancing supply and demand. This balance determines market prices. In order for these processes to function effectively, It is important to guarantee competition and prevent

the exercise of market power. In this way, market mechanisms expand consumption opportunities, motivate suppliers to make innovations and technological advances, and distribute income and profits in accordance with individual achivement. At the same time, these mechanisms can prevent the excessive accumulation of market power . Contd……./2

All photo graphics and image on this site remain the copyright of JSA CORPORATION,
DHAKA, BANGLADESH, Tel:+880-2-9002382, Fax:+880-2-8018360, E-mail:jsa@bdmail.net