Capitalism Vs. Socialism

SOCIALISM vs CAPITALISM

MALAYSIA FALLS INTO WHICH CATEGORY?

CAPITALISM It is fairly easy to understand what capitalism is all about due to its more streamlined usage over the years in comparison to socialism. According to Merriam-Webster Dictionary, capitalism is “an economic system characterized by private or corporate ownership of capital goods, by investments that are determined by private decision, and by prices, production, and the distribution of goods that are determined mainly by competition in a free market”. Capital here means resources like money and goods that are owned and used by capitalists to increase production to make more wealth in the future. Capitalism works by encouraging free market competition where prices, wages,

Basically, everyone wants the best at the very little or no-money-out-of-the-pocket at all. Competing with each other forces companies to maintain low prices to attract consumers.

The most efficient companies create the greatest amount of utility and the most ineffective are driven out of the market when consumers discover that they can obtain the same goods at a lower price elsewhere. Governmental role in this version of an economy is to protect the legal rights of capitalist and other actors of the economy rather than regulating the free market system. In a pure capitalist system, everything is privately owned. That means that there are no public schools, parks, highways even the police

This in part due to the fact that in the early days – 1833 to be exact – it is often used in opaque ways. Sometimes 19th-century writers equated socialism with communism and used them interchangeably. Merriam-Webster Dictionary defines socialism as “any of various economic and political theories advocating collective or governmental ownership and administration of the means of production and distribution of goods”. They also define it to be “a system of society or group living in which there is no private property” which is similar to one of their definition of communism. Furthermore, according to them, socialism is “a system or condition of society in which the means of production are owned and controlled by the state” while communism is “a system in which goods are owned in common and are available to all as needed”.

Finally, socialism is “a stage of society in Marxist theory transitional between capitalism and communism and distinguished by unequal distribution of goods and pay according to work done” whereas communism is the “final stage of society in Marxist theory in which the state has withered away and economic goods are distributed equitably”. Here we can see that socialism and communism share some definition but have significant differences in other in terms of state-sanctioned resources of fully