By Jemima M. Atok
In this complex world of ours, systems were theoretically developed and resolutely practiced. One of these multifaceted systems is the economic system, the,”1method by which monetary (economic) problems are solved in a particular society.” There are multiple systems governing nations, countries, and societies. Each particular system governs the community not only in its livelihood but also in its lifestyle, which in turn regulates the behavior of the people. Thus, economic system greatly affects our progressing world.
Two of these economic systems are capitalism and socialism, which are widely contrasted in theory and practice throughout history. “2Capitalism and socialism are different political, economic, and social systems in use by countries around the world.” Capitalism is “3an economic system in which investment in and ownership of the means of production, distribution, and exchange of wealth is made and maintained chiefly by private individuals or corporations, especially as contrasted to cooperatively or state-owned means of wealth.” On the other hand, socialism is “4a system of society or group living in which there is no private property or a system or condition of society in which the means of production are owned and controlled by the state.” These two systems are north and south poles of a magnet, and, therefore, yield different results in an economy.
Situated on opposite poles, capitalism and socialism aims on different purposes. Capitalism proposes on the purpose of freedom of choice through competition. Consumers can choose among varied products and services. Producers, then, struggle against each other to gain the consumers’ preferences. This principle coincides with Adam Smith’s theory of the limited role of the government in controlling the market in a country or nation, which he articulated in his book The Wealth of Nations (1776). He believed that “5the key concept of a... [continues]
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