Error creating thumbnail: Unable to save thumbnail to destination Illyrianism (or Illyrian Market Socialism) is a market socialist ideology ranging from Error creating thumbnail: Unable to save thumbnail to destination AuthLeft to Error creating thumbnail: Unable to save thumbnail to destination Left-Wing Anarchist on the liberty scale and Error creating thumbnail: Unable to save thumbnail to destination left-wing to Error creating thumbnail: Unable to save thumbnail to destination centre-left (to Error creating thumbnail: Unable to save thumbnail to destination mutualist) economically.
Note: A lot of this is based off a very useful article by David I. Backer which can be found here.
The Illyrian Model was founded by Czech-born Jaroslav Vaněk and Croat-born Branko Horvat and it's main idea is prioritizing a system of "High production, low costs" and ensuring worker control of companies with a "one worker, one vote" basis for decision making. This makes it able to be combined with many ideas, making it an extremely diverse ideology.
The basic features can be considered to be as so:
- Minimizing the average costs of production and equating these with the marginal costs of production.
- All residents receive a split dividend in addition to their basic income.
- Workers self-manage firms, which compete in (possibly free) markets. (communities of workers becomes entrepreneurs).
- Local finance controlled by local banks controlled by the municipalities (a lot of decentralism)
Average Costs of Production
The average cost of production is the total cost of production divided by the total number of things you produced (if 1,000 units are produced at a total cost of $50,000, the average production cost per unit is $50).
Marginal Costs of Production
The marginal cost is the amount total costs changes by producing one more unit of stuff.
Example
To illustrate, suppose a company produces 10 units at a cost of $525. The unit cost is $52.50 (total costs / amount of units so $525 / 10). However, if the firm produces one more unit, only the variable costs increase. Fixed costs normally remain unchanged (as fixed costs have no correlation with amount of units). If the marginal cost is $25 and the company produces one additional unit (so there are now 11), total costs increase to $550. This results in a lower unit cost of $50 (total costs / amount of units so $550 / 11).
This allows more to be produced with a lower sales price.
This is exactly what the Illyrian Model wants - lowering these marginal costs (and if possible, the fixed costs) as much as possible. Spend little to make a lot.