Capitalism
It is an economic system where of goods and services is undertaken by privately-owned companies, which produce and sell their output in hopes of making a profit (production for profit), and where most work in the economy is performed by people who do not own their company or their output, but are hired by someone else to work in return for a money wage or salary (wage labor.)
Capitalism is dominated by capital.
The core features of capitalism create particular patterns and relationships, which in turn shape the overall functioning of capitalism as a system.
- Competition
- Innovation
- Growth
- Inequality
- Conflict of interest
- Economic cycles
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Market
A market is simply a “place” where various buyers and sellers meet to haggle over price and agree on sales of a good, a service, or an asset. A market does not need a physical location to exist – as long as buyers and sellers have a way to communicate and strike deals, there’s a market.
Although economists frequently refer to capitalism as the market economy, it is actually different from it. Capitalism is not the only economic system that relies on markets. Pre-capitalist and even socialist societies relied on markets. There is nothing exclusively capitalistic about markets. Many aspects of modern capitalism have nothing to do with markets. Within large companies, most decisions are not made through market mechanisms but through relationships of command, control and plan. There are also powerful non-market forces that influence decisions like altruism and tradition.
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Fads in Capitalism
- Post-industrial economy
- Information economy
- Shareholder economy
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Source:
Stanford, Jim. (2008). Economics for Everyone: A Short Guide to the Economics of Capitalism. London: Pluto Press.
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Homework for Friday, 4 December 2009
Research on how capitalism disembeds or separates production from consumption. Then, in two to three paragraphs, answer the following essay questions: What is production? consumption? How are they related to each other? Provide comparisons and contrasts. Is the separation of production from consumption good or bad?
Write your essay answer on whole sheets of yellow pad/s. Use only black or blue ink. Write legibly (if you write better with print letters, do so.) Proofread your work for grammatical errors. Do your work at home and submit on time. Well-written works will earn +2 in their Shining Moments scores. However, students are required to and yet not submit their homework will get 3 point deductions in their recitation scores.
The following are NOT required to submit the homework (but they can pass if they choose to increase their Shining Moments points):
Matthew: Barcenas, Bautista, Rea Bertuldo, Bustamante, Calinga, Carcido, Daguil, Gonzales, Macatbag, Oloris, Ongpauco, Piensenabis, Primavera, Rey, Jerson Sabidong, Salaya, Sason, Sia
Moses: Astorga, Galang, Gaudite, Jimenez, Llorca, Pizarro, Salazar
Mark: Diaz
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