the system of creative destruction strikes when one system is unable to maintain the necessary balance in the economy ....Capitalism is a social system based on the recognition of individual rights, including property rights, in which all property is privately owned.
Under capitalism the state is separated from economics (production and trade), just like the state is separated from religion. Capitalism is the system of of laissez faire. It is the system of political freedom. Capitalists believe that the only purpose of a government is to protect its citizens from force or fraud. They claim that the force is the protection of individual’s rights.
Socialism is quite different compared to capitalism, almost like an exact opposite. Instead of the ownership of private property, the government plays a large role where society owns social property such as banks and factories. Although, they own it through the government. Socialism is a society where the resources of the society, controlled by workers, are used for the benefit of the whole economy, not just the rich. The government does have control over production and economic activity, but the workers themselves decide what to produce, where to produce it, how much to produce, and how to distribute the product fairly for the benefit of everyone.
capitalism utilizes the willpower of individuals, especially entrepreneurs, to foment economic activity. Capitalism is based on the assumption that individuals operate based on self interest; however, by doing so they not only help themselves, but also propel others towards economic success. As Adam Smith put it, "by directing that industry in such a manner as its produce may be of the greatest value, he intends only his own gain, and he is in this, as in many other cases, led by an invisible hand to promote an end which was no part of his intention. Nor is it always the worse for society that it was no part of his intention. By pursuing his own interest he frequently promotes that of the society more effectually than when he really intends to promote it."
OR Socialism?
Linear Mode
