Socialist market economy
The socialist market economy is seen by the Communist Party of China as an early stage in the development of socialism (this stage is variously called the "primary" or "preliminary" stage of socialism), where public ownership coexists alongside a diverse range of non-public forms of ownership. The Communist Party of China maintains that despite the co-existence of private capitalists and entrepreneurs with public and collective enterprise, China is not a capitalist country because the party retains control over the direction of the country, maintaining its course of socialist development. Proponents of this economic model distinguish it from market socialism as market socialists believe that economic planning is unattainable, undesirable or ineffective and thus view the market as an integral part of socialism whereas proponents of the socialist market economy view markets as a temporary phase in development of a fully planned economy.
Socialism with Chinese characteristics
Mao said that the imposition of "progressive relations of production" would revolutionize production. His successor's rejection of this view according to A. James Gregor has thwarted the ideological continuity of Maoism—officially Mao Zedong Thought. Classical Marxism had argued that a socialist revolution would only take place in advanced capitalist societies and its success would signal the transition from a capitalist commodity-based economy to a "product economy" in which goods would be distributed for people's need and not for profit. If because of a lack of a coherent explanation in the chance of failure this revolution did not occur, the revolutionaries would be forced to take over the responsibilities of the bourgeoisie. Chinese communists are thus looking for a new Marxist theory of development. Party theorist Luo Rongqu recognized that the founders of Marxism had never "formulated any systematic theory on the development of the non-Western world" and said that the Communist Party of China should "establish their own synthesized theoretical framework to study the problem of modern development". According to A. James Gregor, the implication of this stance is that "Chinese Marxism is currently in a state of profound theoretical discontinuity".