Essay On Advantages And Disadvantages Of Capitalism

704 Words3 Pages
The advantages of capitalism are that the economic freedom assists the political freedom. If the government is the owner of the production and is the one that puts the prices, the state becomes powerful and produce a big bureaucracy which will end up growing in other sections of life. Another advantage would be efficiency. The firms that are in a capitalist are efficient and end up producing goods that are in demand. These motivations produce the pressures to avoid waste and cut costs. The firms that are owned by the state tend to be more efficient. Economic growth would be another advantage of capitalism. With the individuals and firms facing motive to be creative and work hard, which this creates a place of change and economic expansion. This will end up helping to increase the GDP and will improve living standards. The results of increased wealth will be a higher standard of living. With increase wealth, everyone can benefit from this. The disadvantages of capitalism are monopoly power. The results of private ownership are that it lets firms gain monopoly power in labour markets and in the product. The firms that have monopoly powers are able to charge higher prices. Another disadvantage would be monopsony…show more content…
When the government is operating with the ideology of socialism, there would be a lot of spending. Examples would be, healthcare to education and welfare schemes. The disadvantage is that they are as well anti-ambition. They don’t encourage entrepreneurship to dream and do something different. They want everyone to do similar things. They require a massive bureaucracy and a big government. There is a lot of corruption and only a small amount of people end up getting richer. There is a possibility socialism can make the country unproductive and lazy. The citizens would be getting welfare and will end up not working. Socialism gets rich people more rich and the poor people more
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