World History-Capitalism

Capitalism can be defined as a socio-economic and political system where the private industrialists control and run the trade industry, not the state. Goods and services are manufactured based on demand and supply and are known as a market economy rather than being a planned economy. Adam Smith is the first theorist to describe the whole theory of capitalism.

Capitalism became the world’s most successful economic power while producing goods at a cheap rate and exported to overseas markets and it became a free international trade for the entire world. Modern capitalism established itself as merchant capitalism in the 16-18th centuries.

History of Capitalism in the 18th century

In the 18th century, significant procedures in commerce, trade and science were progressing at that time. It was the specific century of political cataclysm with the new political concept of Enlightenment culminating in the French and American revolutions. In the early 18th century, the world’s economy went through several major changes in the industrial revolution and European Imperialism because of religious dynamics changes and the impact of the Boer war at that time.

 In that period, Europe continued to extend their networks into trade and create new factories across the world. In the early 18th century, European imperialism grew continuously to control the resources directly and become the wealthiest country across the world. Radicalism started to grow in the 18th century in Europe, which discussed the rights of local people in the nation and made rules for allowing freedom of press and right of vote. 

Capitalism 

Capitalism refers to a “free market economy” in the western part, which means production is guided and owned privately and the distribution of large incomes over economic markets. Capitalism has some pillars to expand the nation for achieving great profit. One pillar is the private assets that allow the people to act in pursuit of their profit without experiencing political pressures.

The second pillar of capitalism is competition; it helps to enter and exit freely in the competitive market and establish joint welfare between the consumer and producer. Another pillar of capitalism is the market mechanism that helps to identify and manage the prices through the sellers and buyers with high rewards in their trading.  

Capitalist countries in the world 

Capitalism supports building trust between the several countries that create economic freedom and opportunity that provides empowerment through the people for their investment and trading. The survey of “The Economic Freedom of the World” shows the top two countries that made their rank in world history through capitalism. The first country was Hong Kong, which implemented its economic policies to be transparent and stable in the legal environment to maintain and achieve the freest economy in the world. And, the second country was Singapore, whose economy flourishes due to the policies. 

 It generated the openness to international investment and trade continuously to give a solid reason for their economic boosts. Secured rights for properties, commercial securities and a transparent environment provide the chance to develop a resilient and innovative private sector.

Capitalism in world history 

The impact of capitalism in world history provides powerful institutions including the modern history of commerce, trade and corporation. In the 1700s the growth in achieving better lifestyles became the main character of economic life in western countries and it was associated with capitalism and it made private firms, markets and properties play an important role in global history. With advanced specialization and technologies in production raising the efficiency of the daily work’s power, that helps to expand their trade over the world.

The process of the capitalism revolution in world history determines the growing threats to the economic environment for better livelihoods and making more profit through their business. West Africa, China and East Europe became the world’s most capitalist countries while adopting capitalism in their economy. Moreover, capitalism aims to mobilize its resources to achieve benefits through financial growth and support to produce more goods at low cost and increase the need for those products towards other countries. 

Capitalism and socialism 

Capitalism refers to a capitalist economic system that helps in production, labour, natural resources controlled by the private factories and firms. Socialism states that a socialist economic system that helps in production, capital goods and labour is controlled by the Government. In capitalism, the supply and demand forces control the cost of services and goods.

According to socialism the price of services and goods is controlled and supervised by the government of the nation. In capitalism, the main purpose of their production of services and goods is to earn large profits. For a socialist economy, the purpose of their production is the welfare of local people. There is no role of the government in capitalism and socialism, the government of plays a major role in the complete supervision of production.

Conclusion  

The essential character of Capitalism is the motive for making more profits and the private owners controlling the whole supply and demand in the markets to serve large interests in the best way to society. Capitalism contributes its profits in multiple sectors to increase the expansion of the major business. The private sector dominates the production and management of goods and services in capitalism. On the other hand, socialism distributed their income less or more than the capital and it supervised entire trading under the government. The stock market and Wall Street is the best example of Capitalism, which means prices are significantly impacted by demand and supply.