Capitalism refers to an economic system where the means of production and trade are controlled by the private owners in pursuit of profit.
| Characteristics | |
|---|---|
| Arguments in favor of | Arguments opposing |
| Private ownership of the means of production and trade. | |
| Private ownership can result in more efficient use and management. | Private ownership may create a class distinction and may be unneccessary for collective production. |
| Allocation of resources based on price mechanism. | |
| Capitalism helps to regulate supply and demand based on market prices. | Capital markets are susceptible to mispricing which can negatively impact supply and demand. |
| Encouraged pursuit of profit. | |
| Accumulated capital can be reinvested in the economy helping to increase the total quantity of capital. | An overaccumulation of capital is possible where surpluses of capital and labor coexist. |
Competing Views...