Capitalism vs. SocialismCapitalism vs. Socialism

Created by: Tammy TwiggsCreated by: Tammy Twiggs

Definition of CapitalismDefinition of Capitalism

According to Dictionary.com, According to Dictionary.com, Capitalism is…Capitalism is…

an economic system an economic system investmentinvestment in and in and ownershipownership of the of the

means of production, distribution, and means of production, distribution, and exchange of wealth is made and exchange of wealth is made and

maintained chiefly by maintained chiefly by private private individuals or corporationsindividuals or corporations

Definition of SocialismDefinition of Socialism

According to Merriam-Webster, Socialism is…According to Merriam-Webster, Socialism is…

Government ownership and Government ownership and administrationadministration of the means of production of the means of production and distribution of goodsand distribution of goods

A system of society or group living in which there A system of society or group living in which there

is is not private propertynot private property A system or condition of society in which the A system or condition of society in which the

means of production are means of production are owned and owned and controlled by the statecontrolled by the state

Capitalism vs. SocialismCapitalism vs. Socialism

Capitalist countries:Capitalist countries: AmericaAmerica CanadaCanada BrazilBrazil JapanJapan MexicoMexico

Socialist countries:Socialist countries: CubaCuba Saudia ArabiaSaudia Arabia IranIran North KoreaNorth Korea BurmaBurma

Mixed EconomyMixed Economy

According to dictionary.com, a Mixed According to dictionary.com, a Mixed economy is:economy is:

An economy in which some An economy in which some industries are privately owned and industries are privately owned and others are publicly owned or others are publicly owned or nationalized nationalized

Many capitalist economies are mixed Many capitalist economies are mixed economies (some capitalism and economies (some capitalism and some socialism)some socialism)

Pros and Cons of CapitalismPros and Cons of Capitalism

ProsPros Competition to Competition to

provide goods and provide goods and services keeps prices services keeps prices lowlow

Rewards hard workRewards hard work Provides choiceProvides choice Allows for the building Allows for the building

up of wealth and up of wealth and possessionspossessions

Consumers regulate Consumers regulate the marketthe market

ConsCons Exploits people who Exploits people who

cannot competecannot compete Uneven distribution of Uneven distribution of

wealthwealth Creates a money-Creates a money-

oriented societyoriented society Constant economic Constant economic

growth may deplete growth may deplete the earth’s resourcesthe earth’s resources

Pros and Cons of SocialismPros and Cons of Socialism

ProsPros All members share benefitsAll members share benefits Those who cannot Those who cannot

contribute may still contribute may still participate (disabled, participate (disabled, elderly)elderly)

Each member’s survival Each member’s survival needs are metneeds are met

Equal distribution of wealthEqual distribution of wealth No socioeconomic classesNo socioeconomic classes

ConsCons No incentive to work No incentive to work

harderharder No competition means No competition means

no reward to be no reward to be innovativeinnovative

New members to the New members to the community (immigrants) community (immigrants) are seen as competition are seen as competition for limited goods and for limited goods and servicesservices

Higher taxesHigher taxes

Which is best: Capitalist economy, Socialist Which is best: Capitalist economy, Socialist economy, or a Mixed economy?economy, or a Mixed economy?

A free market exists with some A free market exists with some regulation by the governmentregulation by the government

People can create their own People can create their own businesses and make a profitbusinesses and make a profit

All businesses pay taxes, which All businesses pay taxes, which benefit everyone benefit everyone

Government subsidized programsGovernment subsidized programs

Postal servicePostal service Rail linesRail lines LibrariesLibraries Health careHealth care Social programsSocial programs RoadsRoads Infrastructure (bridges, freeways, etc.)Infrastructure (bridges, freeways, etc.) Can you think of any others?Can you think of any others?