Essentials of Sociology
Let us compare socialism and capitalism by learning about their definitions. A capitalist economy is one in which the means of production are owned and controlled by a class of people, known as the "capitalists". The capitalists are the ones who have the capital to make investments in factories, machinery and who pay workers their salaries. In today's times, capitalism refers to a form of political system in which means of production are owned by the private sector and whereas the government has a very limited role with regards to running the businesses. A socialist economy is the one in which the means of production are owned and controlled by the workers. The ownership can be in the form of trade unions, cooperatives or through the state itself. In today's times, socialism refers to a political system where ownership and control of means of production lies with the people as a whole or with the state, with lots of emphasis on central planning, by the state. Communism, another social system, evolved from socialism. To truly understand what is socialism and capitalism, the difference between the two have to be completely understood. The capitalists believe that there should be a complete non-interference by the government in the economy. They believed that an economy can run efficiently on its own through the natural mechanism of demand and supply. Capitalism is a political theory that advocates competition between the sellers to supply a particular good or service, and between the buyers to get the service or goods. The sellers compete among each other so that they make the maximum profit. Buyers compete among themselves to get the best deal while purchasing the goods. Capitalists strive for a free market economy and also advocate "private ownership" of means of production. Socialists, on the other hand, propose that the state or the government is the one which should be in total control of the...
Bibliography: Henslin, M. H., (2013). Essentials of Sociolology. Pearson Learning Solutions.
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