Economics Assignment: Examining the Impacts of Capitalism on Society

This economics assignment analyzes the impacts of Capitalism on society. The assignment highlights the positive aspects of a capitalistic framework, such as encouraging individual productivity and maximizing efficiency through competition. It discusses the benefits of free market systems, including co...Read More

Running head: ECONOMICS ASSIGNMENT
Economics Assignment
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1ECONOMICS ASSIGNMENT
Introduction
Capitalism is the condition prevailing in the economy where the productive resources are
in the hand of the private sector and there are minimum or no control on part of the state. This
means that the production dynamics is decided by the free market and there is no intervention on
part of the government. Capitalism facilitates profit maximization in the society.
Positive Impacts of Capitalism
Apparently, the Capitalistic framework primarily works towards the maximization of
individual residents of the society. However, Capitalism has several positive implications on the
residents of the capitalistic society and the society itself.
The primary positive side of Capitalism as a social framework is that it encourages
people to work more to be rich. Under this framework, people are paid according to their efforts.
Due to the presence of free market system, there exists a substantial competition between the
firms of the same industry, which in turn encourages them to use their resources such that their
productivity and profitability are maximized. This in turn implies that Capitalism encourages
efficiency maximization. Due to the absence of stringent regulations from the government, the
consumers in the society enjoy freedom to choose from the goods and services which are present
in the economy. Due to the presence of competition in the industry, the firms have to keep the
pricing at competitive level, which in turn also benefits the consumers.
The positive effects of Capitalism can be measured in terms of the economic growth of
the country as a whole, which can be attributed to the increase in productive efficiency.
However, the economic growth does not show the presence and magnitude of inequalities in the
country, which can be a hurdle in measuring the actual impacts of Capitalism.