1. Discuss both advantages and disadvantages of living in a capitalistic society. Then, describe such disadvantages could be minimized.
A capitalistic society is when the factors of production and distribution are driven by consumers and their wants and needs. This economic system is also called free-market capitalism which allows people to start businesses they want to. Just like other types of economic societies there are positive aspects and there are also some negative too.
One of the positive parts of capitalism is that everyone has the right to own private property. This allows people to buy, sell, or use land other resources like buildings, machinery, and other assets. Business owners that are successful have the right to the profits they have earned. This drives people to do better because then the reward will be greater. If people had to work as hard as they do and aren't able to keep what they've earned, they wouldn't work nearly as hard or care as much. The right to own a business and keep all the profits is what drives incentive.
In a capitalistic system, like here in the United States, we strive for perfect competition. Having companies compete for your business is what drives the prices down. This is another benefit of capitalism. When consumers are looking for products to buy naturally they want to pay as little as possible. Companies will sell more of their product if they have the lowest prices and in the long run will increase their revenue. In the end both sides are happy.
With so many business striving to be the best there are other benefits. Companies need workers to help run their business and jobs are created that way. People are free to choose where they live and what they do for a living. With the money they make from their jobs, people are also free to choose what they buy and sell. When people are making money they are more likely to be spending it, which drives the economy.
The downfall to capitalism is that business owners can get caught up in greed and try to cut corners in order to save money. False advertising is another disadvantage about capitalism. Businesses may not always be truthful about their products in order to increase sales. It is the customers who are negatively affected here. Overall capitalism is a really great kind of society to live in.
1 comment:
I really like your mentioning of perfect competition in the United States and how it can help drive the economy in a positive way. Because if there are numerous sellers of the same product in the market each business will be on the same playing field because none is large enough to dictate the price of the product; therefore, there will be more competition for lower prices like you stated. I also like how you added that when people are making more of their own money due to privately owned business they are more likely to spend more, which in turn helps other businesses and the economy grow. While in socialistic and communistic societies individuals are less likely to go out of their way to buy extravagant gifts and goods because the government controls the prices. I also like your mentioning of false advertising as a disadvantage of capitalism because of the increasing of competition. I think larger companies are more invested into false advertising than small, local companies because they are trying to gain the interest of a whole population, while small companies are only striving to gain the interest of a small population. False advertising can cause shoppers to believe they are getting a high quality product for a certain price while in actuality it is an extremely lower quality. Capitalist companies become greedy and just start to focus on the money rather than the company’s integrity.
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