Market or Government – Is There a Third Way?

The paper deals with the discussion on the possible models of economy – market economy, which is usually associated with capitalism, and planned economy, which is usually associated with socialism. The experience of the 20th century has shown that efforts to choose the model of socialism have failed. Is it sufficient to make a conclusion, that capitalism is preferred to socialism not depending on conditions? Even if so, that the events of the 21st century show, that model of capitalism also has faced serious contra versions, and thus should be significantly modified. The great economists from Smith to Keynes have made forecasts about the new model of economy in the future – neither socialism, nor capitalism in a common sense. To solve the global problems, we need to think outside the box, revising critically the conventional wisdoms, thus creating a new model of economy. A possible way in that direction may be the localization of economy in a global scale.