Does the Capitalist Free Enterprise System Improve Justice in Society
“Capitalism can be defined ideally as an economic system in which the major portion of production and distribution is in private hands, operating under what is termed a profit or market system (Shaw, Barry, & Sansbury, 2009, p.127).” Over the many centuries, capitalism has evolved from the emergence of capitalism during fifteenth and sixteenth centuries, mercantile capitalism, financial capitalism with the increased industrialisation and the intensified competition, to today’s globalised capitalism. Although, the names used to describe capitalism have been changed over …show more content…
On the other hand, while individuals are free to their own choices, productions and distributions are settled totally depending on demand and supply in the market. At the same time, equilibrium prices satisfying all buyers and sellers are also established according to the market. Under the competing environment, companies have to be customers orientated and serve the customers as God in order to acquire the market volume and make the profit. Individuals benefit from either receiving premium products and services or paying them at a low-price (Ertuna, 2009, p69-71).
We can see from the above facts that the competition results in production efficiency and brings the economic benefits to individuals. As identified by Adam Smith, the free enterprise system is like an invisible hand guides the market dynamically and automatically to the direction of the greatest utility from unfettered pursuit of self-interest (Shaw, et al., 2009, p.134). We have to admit that it has been a very efficient and productive system and contributed economic growth and