Economic Systems Socialism and Capitalism Essay - 1018 Words

I have observed that when Americans discuss the relative merits of socialism vs. capitalism, the chief debates that come up are †¢ What would happen if we remove the stimulus for innovation and productivity that a free market generates? This implies having a free market including individual ownership and control, and to varying degrees a laissez-faire government. †¢ Would it be possible to have a thriving society in which we would not have 20% of the population living in poverty and without adequate healthcare, housing or economic security? Fundamentally, we characterize and differentiate capitalism from socialism by the way they handle production (industry), distribution, and exchange (trade) of wealth and goods. In capitalism, capital†¦show more content†¦It was also at this time that monopolization became widespread. Eventually, incorporated entities became able to perform many of the actions of individuals such as being able buy and sell property, hold patents, sue and be sued, etc. (Peavler). The philosophy, such as proposed by Adam Smith, came to be that an economy has a natural design. Left to its own devices -- and removed from politics, religion and all other pursuits -- it will regulate itself as long as no one throws a spoke in the wheel and everyone benefits. The governments only real role in capitalism became to maintain peace and order so the economy can work without interruption (Newman). In its purest sense, a socialist economy communally controls the production, distribution and exchange of resources. This community control is implemented by the state through a central government acting on behalf of the citizens. The roots of socialism lie in Thomas Moore’s idea of a utopian society. During the 18th and 19th centuries the industrial revolution and concomitant urbanization, resulted in increasing concentration of wealth and power (Hoyt). Many feared that the freedom to engage in capital mercantilism had the natural consequence ofShow MoreRelatedEconomic Systems, Capitalism And Socialism1829 Words   |  8 PagesEconomic Systems People can use economic systems to build empires and destroy civilizations. The society s featured in the books 1984 by George Orwell and Fahrenheit 451 by Ray Bradbury did just that. Both took advantage of some form of an economic system to achieve their respective goals. Whether it be the command economy of Oceania, or the overly consumerist economy of the dystopian United States, they both employed economics to their benefit. Economics is the science of scarcity. 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