Free Market Economics Vs Communism
The economy of South Africa is the largest in Africa. South Africa accounts for 35% of Africa’s GDP and it is rated as an upper-middle-income economy by the World Bank, one of only four such countries in our continent. (Alongside Mauritius, Gabon and Botswana). According to the World bank, the GDP per capita in 2013 was 6.617.91 USD, GDP- 350.6 billon USD, GDP growth rate-1.9 percent annul change, Gross national income- 648.7 billion PPP dollars, GNI per capita-12.240 PPP dollars and the unemployment rate in 2016 was 26.6%. This academic writing will expatiate the comparison between free market economics and communism and further expound on communism.
Free market economics and Communism occupy two polar extremes in the economic activity. The major differences lie in the separation of labour or the factors of production and the mechanisms that determine prices. The economic activity in the market economy is unplanned, it is not organized by any central authority and is determined by the supply and demand of goods and services. On the other hand, communism is organized by officials from the government who also own and direct the factors of production.
The two fundamental aspects of market economies are:
• Private ownership of the means of production
• Voluntary exchanges or contracts …show more content…
You have to remember that Marxism was created because of a large class struggle throughout the European continent. The market was dominated by a wealthy class, leaving the working class to suffer. The competition in this market led to low wages and unemployment for many – communism was a solution. The idea of communism is the abolition of private property. It focuses on the group not the individual. Economically this is very ideal. This would definitely be essential for a growing economy. With a new, classless society the unemployment rate would be zero. Poverty cannot exist within a communist society. Unemployment is a