There are numerous issues that can be resolved through capitalism that cannot be solved though socialism. The most prominent being the lack of incentive found within a socialist economy. If everyone is paid the same amount of money regardless of effort, then there is no true incentive to work. If there are no rewards, for example, employees who are given bonuses to praise their hard work and successful efforts continue to work hard in order to receive another bonus. Without such incentives, people may begin to slack during their jobs without personal repercussion. Since a socialist economy dictates that everyone must be employed and paid the same amount, productivity efforts will see a drop without the added bonus that rewards hard work.
Productivity will decline within a socialist economy, because there is no incentive to work harder. The result is an economy with lazy workers who do not work to their full potential, because they will be receiving the same pay at the end of the day as they would putting in an immense amount of effort. Logically, there is no reason for …show more content…
Those who have a high income most likely gained it through their hard work, whereas those who have a lower income likely have not risked as much as those who earn more. A capitalist economy rewards those who work hard, which then gives the individual more incentive to continue their hard work. This leads to a higher production and productivity rate within the capitalist economy when compared to the socialist economy. Incentives give individuals a reason to work hard and to strive to do better in order to achieve a higher standard of