Abstract: With the deepening of the reform of socialist market economy,capital power,which can legally dominate production factors,will hold a dominant position in the primary distribution.The gap between the rich and the poor,caused by primary distribution,will prompt us to classify production factors and reflect how to perfect the principle of distribution according to production factors.Specifically,if such production factors as technology and management are measured by complex labor,the earnings may be brought into distribution category of labor factors.However,capital should not be embodied in labor,however large the connotation and extension of labor are.So,it is necessary to perfect the distribution principle according to contribution of labor factors.As for the capital,it should be viewed alone according to contribution of capital in distribution.And this is the connotation to give consideration both to efficiency and fairness in the primary distribution in China with socialist characteristics.

Key words: market economy, production factors, primary distribution, distribution according to labor, distribution according to capital, giving consideration both to efficiency and fairness