Difference Between Capitalism And Socialism

Capitalism and socialism are known as formal economies
The main difference between both of them moves around the government role and economies equality. Capitalism affords economic freedom, consumer choice, and economic growth. Socialism economy is controlled but the state and central planning authority planned it and it gives social welfare.
Capitalism is characterized in the following ways:
 Capitalism is made up of buyers and sellers and it’s basically a market based economy.
 The profit is made by the goods and services and in that economy profit is reinvested.
 The government must not interfere in the economy of free market.
 To operate effectively there is essential need for continuous purchase and production for capitalist economy. …show more content…
 Opportunities are equal for all. Large-scale industries are cooperative efforts, and thus, the returns from these industries must be returned to and benefit society as a whole.
 Central planning authority plan economic activity and production. and based on human consumption needs and economic demands.
 Economic inequality is bad for society socialists believe that and the government is responsible for reducing it via programs that benefit the poor.
For example, in the U.S., we have Medicare, social security benefits, and social nutrition assistance programs that are considered socialist in nature.
ADVANTAGES:
• Great efficiency
• Greater social