Abstract:The “market failure” can only provide the theoretical basis for capitalist countries to develop the limited state-owned economy, “production socialization” is the productivity basis for production material public ownership to replace private ownership, the productivity level at “the initial stage of socialism” requires China to realize the mutual development of multi-ownership economies by taking public ownership as the lead under socialism market economy. Therefore, the coordinated development of state-owned economy and private economy should take the premise of bringing the leading role of state-owned economy and market economy system into fully play by following the general law of market economy and by sufficiently embodying the obvious advantage of China’s national system and national governance system. The practice of the coordinated development of state-owned economy and private economy must be guided by Xi Jinping’s Thoughts on Socialism with Chinese Characteristics, be orientated by productivity liberation and development, use market mechanism to realize the resources allocation coordination of state-owned capital and enterprises and private capital and enterprises, realize the products supply coordination of state-owned capital and private capital by developing the mixed ownership, optimize market environment to realize the industrial development coordination of state-owned enterprises and private enterprises, and further sufficiently bring each comparative advantage of state-owned economy and private economy into fully play to perfect socialism modernization economy system and to continuously promote production socialization degree and economic development quality.