The Capitalism

Topics: Capitalism, Economics, Adam Smith Pages: 8 (2741 words) Published: February 28, 2013
The capitalism

Business Administration Industrial Sociology

1. Introduction
* Definition
* Main characteristicts
2. Origin
3. Stages
* Commercial Capitalism
* Early Manifestations of Capitalism in Florence
* Financial Capitalism and its Character
* Technological Capitalism
4. Practical case

1. Introduction
Capitalism is an economic system founded on the private ownership of capital goods and the ways of production, with the formation of goods and services for profit.  Elements central to capitalism take in capital accumulation, competitive markets, and a price system. There are many variants of capitalism, counting laissez-faire, welfare capitalism and state capitalism. Capitalism is considered to have been applied in a diversity of chronological cases, varying in time, geography, politics, and culture. There is general agreement that capitalism became leading in the Western world following the demise of feudalism. Economists and historians have taken dissimilar perspectives on the analysis of capitalism. Economists usually emphasize the degree to which government does not have control above markets (laissez-faire), as well as the importance of property rights. Most political economists emphasize private property as well, in addition to power relations, wage labor, class, and the uniqueness of capitalism as a historical formation. The extent to which different markets are free, as well as the rules defining private property, is a matter of politics and policy. Many states have what are termed mixed economies, referring to the varying degree of planned and market-driven elements in an economic system. In the 20th century defenders of the capitalist system often replaced the terms capitalism and capitalist with phrases such as free enterpriseand private enterprise in reaction to the negative connotations sometimes associated with capitalism. The term capitalism, in its modern sense, comes from the writings of Karl Marx. Before Marx, "capitalism" simply referred to the possession of capital. The main characteristics would be:

a) The means of productions are privately owned. In this context capital refers to building, machinery and other tools used to produce goods and services for consumption primarily b) Economic activity appears organized and coordinated by the interaction between buyers and sellers that takes place in the markets c) Both the owners of land and capital as workers, are free and looking to maximize their welfare, so try to get the most out of their resources and the work hat used to produce consumers can spend as they see their income to obtain the greatest possible satisfaction, this principle is called consumer sovereignty, shows that, in a capitalist system, producers are forced, due to competition, to use their resources so that they can meet the demand of consumers, self-interest and the pursuit of benefits leads them to follow the strategy. d) Under capitalism private sector control by the public should be minimal considering that competition exists, control economic activity itself, the activity of the government is only required to manage national defense, enforce property and enforce contracts this ancient vision of the role of the state in the capitalist system has changed a lot during the twentieth century. 2. Origin

Since the 16th Century, some European States such as England or Netherlands, favor the development of commercial activities with the aim of obtaining more precious metals such as silver or gold. People thought that having huge amounts of these metals meant wealthy. This was called Mercantilism. So, it appears substituting Feudalism. Mercantilism was based on the private property and the use of markets to organize the economic activity. This benefited some social strata; in particular bankers and bourgeois merchants. They accumulated massive amounts of...
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