In 1992, the 14th National Congress of the Communist Party of China established the socialist market economy system, which has been in practice for thirty years. The issue of the relationship between the government and the market has always been a major theoretical and practical issue in the history of socialist economy, and the core issue of establishing a modern economic system is to deal with the relationship between the government and the market. Since the establishment of New China, the roles of the government and the market in resource allocation have undergone multiple transformations, and since the establishment of the socialist market economy system, the relationship between the government and the market has been in continuous improvement, and on the basis of the government's efficient and stable provision of public goods. On the basis of the efficient and stable provision of public goods by the government, the market effectively plays a decisive role in the allocation of resources. A socialist market economy system that combines a competent government with an effective market is of great significance in promoting the growth of China's economy. History and practice have proven that the relationship between the government and the market is not static, but is constantly adjusted to fit the economy and society according to different development goals and stages.