market economy

a capitalistic economic system in which there is free competition and prices are determined by the interaction of supply and demand.
Also called free market economy.
Compare command economy. Unabridged
Based on the Random House Dictionary, © Random House, Inc. 2014.
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American Heritage
Cultural Dictionary

market economy definition

An economy in which the greater part of production, distribution, and exchange is controlled by individuals and privately owned corporations rather than by the government, and in which government interference in the market is minimal. Although a total market economy is probably only theoretically possible (because it would exclude taxation and regulation of any kind), capitalist economies approximate it and socialist economies are antithetical to it (see capitalism and socialism). Market economies are also called free economies, free markets, or free enterprise systems.

The American Heritage® New Dictionary of Cultural Literacy, Third Edition
Copyright © 2005 by Houghton Mifflin Company.
Published by Houghton Mifflin Company. All rights reserved.
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Example sentences
In their view, the best that can be said about reps is that they are a
  necessary by-product of a market economy.
The regime's inability to provide even basic necessities has wrecked its
  credibility and spawned a rudimentary market economy.
Any economic system, but especially a market economy, produces winners and
And it is attempting to produce laws for the market economy, not the socialist
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