“Thus the market in the capitalist economy is the process regulating production and consumption. It is the nerve-center of the capitalist system. Through it the orders of the consumers are transmitted to the producers, and the smooth functioning of the economic system is secured thereby. The market prices establish themselves at the level which equates demand and supply. When, other things being equal, more goods are brought to the market, prices fall; when, other things being equal, demand increases, prices rise.It is quite surprising how much Mises was prepared to concede: an economy with some limited nationalised industry (although run on the principle of profit and loss) where the majority of capital goods are private owned is still a “market economy” with its fundamental characteristics “essentially unimpaired.”
One thing more must be noted. If within a society based on private ownership of the means of production some of these means are publicly owned and operated, this still does not make for a mixed system which would combine socialism and private property. As long as only certain individual enterprises are publicly owned, the remaining being privately owned, the characteristics of the market economy which determine economic activity remain essentially unimpaired. The publicly owned enterprises, too, as buyers of raw materials, semi-finished goods, and labor, and as sellers of goods and services, must fit into the mechanism of the market economy; they are subject to the same laws of the market. In order to maintain their position they, too, have to strive after profits or at least to avoid losses.” (Mises 1998: 5)
That is a view far from ravings of many internet Austrians.
Mises, L. von. 1998 . Interventionism: An Economic Analysis (trans. Thomas Francis McManus and Heinrich Bund). Foundation for Economic Education, Inc., Irvington-on-Hudson, NY.