Capitalism

Capitalism is based on the Darwenian concept of survival of the fittest. While I am aware of no nation that practices a pure form of this economic system, several Western countries use a form of capitalism at the core of their economies. Scaled-down examples of capitalism are flea markets, bazzars and black market trading. Properties of Capitalism
• • • • • •

Social/cultural rules and political laws define the environment. Supply and demand provide environmental pressures. Those that best "fit" that environment survive and maintain the rules/laws. Those that can't/don't thrive in the system, and otherwise lack participation, are culled. Successful capitalistic systems tend to be open and competitive. A healthy capitalistic system results in economic incentives.

Advantages of Capitalism

Capitalism is an internally stable economic system, in that it is consistent with human behavior. People understand that life is not fair - there's no "free lunch". You have to work to survive, and only the lucky who manage to thrive within the socio-economic matrix make it to the top. As long as there is a belief/hope that one can advance in the system, there is an incentive to participate. Capitalism is also externally stable, in that survival in a capitalistic system requires innovation and flexibilty to keep up with the changes in supply and demand. Such a system is generally prepared to deal with the influx of competition from external sources. Large populations are likely to be diverse, which is beneficial to healthy capitalistic systems.

and I know of no self-sustaining country that uses communism as a basis for their economy. and encourage incentives for such distribution. which disrupts and destablizes the system. Disadvantages of Capitalism • It is not acceptable in most modern societies to allow portions of their population to be "culled". and open up competition to external markets.• Large. . capitalism easily adapts to such structures. diversified societies tend to gravitate towards heirarchical social systems. Successful. Communism Communism is based on the concept of shared effort and shared resources. Encourage the inclusion of all members of the population to compete. • Those in power tend to construct rules that limit diversity and competition. Educate the elite to the systemic benefits of resource distribution. Remedies for Capitalism • • • Create secondary social mechanisms to support those that do not "fit" in the socio-economic system. • Vast imbalances in opportunity encourages revolt. thereby weakening the flexibility and strength of the system as a whole. No existent nation practices pure communism. in order to maximize diversity and flexibility.

Communism requires common goals and agreed upon rules/laws to allocate responsibilities and resources.which builds stronger social communities.scaled-down examples of communism include early Christian congregations. If successful. Advantages of Communism • • • Communism is an internally stable economic system.creating an incentive to participate. in that those that participate benefit and those that don't are culled . Due to their sense of cooperation. Properties of Communism • • • • All members of the economy share both work and benefits. Successful communistic systems tend to be small and homogeneous. healthy communistic systems are very efficient at distributing resources within their localized areas . A healthy communistic system results in a cooperative society. . kibbutzes and cooperatives.particularly in times of need. making it difficult to maintain a common goal or set of rules for shared effort and resources. creating a stabler economy. Those that do not provide their share of effort and resources to the system are culled. Disadvantages of Communism • Large or geographically broad populations tend to be diverse. this leads to a spirit of sharing .

. Properties of Socialism • • • All members of the economy share benefits. and minimize hierarchies. Socialism Socialism is based on the concept of everyone gets their share.• • Large. diversified societies tend to gravitate towards systems of heirarchy. Succesful socialistic systems depend on sufficient resources for the entire population. Advantages of Socialism • In environments with plentiful resources. Block out external cultural influences and control external trade. or compete with. communistic systems tend to block out external cultures and exclude outside competition. socialism provides all members with their survival needs.which can destablize a communistic society. or populations are extremely small (such as family units). As such. A healthy socialistic system results in non-economic productivity. external economies. Allowing an influx external culture increases the likelyhood of destablizing the homogeneity of the society. weakening the system's ability to learn from. creating a stable social environment. Remedies for Communism • • Keep the society small and homogeneous. reducing the perception of fair distribution of work and resources . This economic system exists in those environments where resources are plentiful. regardless of their economic value to the system.

such as pure science. In times of plenty. or periods of poor health . Keep out immigrants. since external forces and internal disasters exist. Comparisons: Capitalism vs Communism vs Socialism In an isolated world of plenty. age.due to disabilities. while potentially adding nothing economically productive. In an isolated. causing a destabilizing effect on the society and economy. communism provides all participants with . socialistic systems tend not to be competitive. homogeneous society with a common goal and belief system. This makes socialism internally unstable. emotional support and continuity of experience to the system.can still impart wisdom.• • Members that cannot participate economically . In times of scarcity. immigrants are drawn to the free resources offered by socialistic systems. socialistic systems provide no inherent incentive to participate. Remedies for Socialism • • Avoid scarcity of resources. However. making them externally unstable. Freemdom from work provides opportunity for some societal members to explore non-economicallyproductive pursuits. math and non-popular arts. socialism is unsuitable as the principal basis for a long-term economy. Disadvantages of Socialism • • • • Since there is no culling and no economic advantage to working harder. socialism provides everyone with what they want and encourages creative exploration. Due to a lack of incentives. resentment of non-economicallyproductive members of society increases.

it benefits from diversity and external competition. Open competition and free trade. For all it's woes regarding class discrepancies. However. to maintain its health. capitalism is the most inherently stable economic system . In times of need: distribution of resources. and aspects of communism when the need arises. This must be accompanied by open competition and diversity . it is becoming increasingly difficult in this shrinking world to maintain cultural isolation. diverse nation. and the tendency of the elite to constrain opportunities to themselves. In times of plenty: support for non-economicallyproductive creativity. the power elite of a capitalistic society must encourage certain societal behaviors/rules/laws: • • • • Diversity of cultures and methods. This works well for small communities. particularly for non-diversified societies. The above system describes an economy based principally on capitalism.a fair share of the workload and resources. but with added aspects of socialism when resources are plentiful. However. diversity makes communism unsuitable as a core economy for most modern nations.which I believe depends on freedom of expression. Capitalism can be supplemented on local basis by the communistic support of families and . Summary Capitalism is the most appropriate economic foundation for a large. free access to information. and education. A healthy capitalistic economy also provides built-in incentives to it's members to increase their economic participation in the system.

This increases preparedness for times of need. In times of plenty. while encouraging the diversity of local cultures. .cultural/social/religious organizations. capitalism should be tempered by socialistic mechanisms that aid the needy and support the arts.

Sign up to vote on this title
UsefulNot useful