Capitalism Social

Capitalism Social

Capitalism, the social system in which capital is owned by private persons and work is undertaken, not as a customary duty or in response to commands, but for material reward under a system of free contract. The word may be used to describe the system of production in a particular sector of an economy or, more loosely, an economy in which part of the productive capital may be owned by the state or by co-operatives but in which private ownership of capital is we-dominant. Capitalism differs from socialism in its private as opposed to socialized (normally state) ownership of capital; it differs from the feudal system in its extensive use of free contract between employer and employee in place of status.

The tern is used widely to cover strikingly different social and economic systems. The early capitalism of sixteenth- and seventeenth-century Europe was particularly associated with trade and finance and with relatively smalll units of production. The importance of religious and other factors in the early development of capitalism has been debated by historians, sociologists and theologians (such as Weber, Troeltsch, Tawney and others). With further technical progress and accumulation of capital it became possible to argue, as Marx did, that capitalism created a propertyless, wage-earning proletariat exploited by a class of property owners or capitalists who played no part in 'production' but expropriated the 'surplus value' created by labour. Marx argued that 'internal contradictions' in capitalism would lead to its destruction. He predicted, among other things, a growth in monopoly power and worsening crises of overproduction, with the 'proletariat' increasing in size and coherence as a group while its standard of living was forced down by increasing exploitation. These and other developments would create the preconditions for a socialist state; socialism, and then communism, would replace capitalism first in the more advanced countries and then everywhere.

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Since then his writings have in turn been increasingly reinterpreted as a special case both by some followers and by some economists who had not wholly accepted his writings. The content of economics is in a state of change, and this site is therefore not a final statement of economic doctrine.

Economics is in the last resort a technique of thinking. The reader will therefore need to make an intellectual effort, more substantial for some web entries than for others, to get the most interest and value out of this website.