Abstract: The main reason that contemporary socialist movements meet with frustration and setbacks results from violation of Marxist basic principles: undue emphasis on public ownership hinders the development of productive forces. The success of socialism with Chinese characteristics lies in the fact that we have initiatively adjusted and optimized our ownership structure to adapt to the emancipation and development of productive forces, centering round the establishment of socialist market economic system. The paper argues that to strive for the goal of co-existence of different ownerships and optimization of ownership structure “three favorables” should be firmly adhered to during the transitional stage , and full consideration should be given to the law of market economy. The key point of our work at present includes the following aspects:To deepen the reform of state ownership economy; to encourage and guide the development of non-public ownership economy ; to create a equally competitive environment for diverse forms of ownerships.

Key words: public ownership, state ownership economy, non-public ownership economy ownership structure, market economy