1. Capitalism, Socialism, and Communism

2. Draw This Chart (for your notes)
Capitalism
Socialism
Communism
Definition
Person Associated
Written Works
Government Involvement
Type of Government
Extra Important Details

3. Capitalism
Capitalism – an economic system based on private ownership and on the investment of money in business ventures in order to make a profit.
Capitalism has always existed. Markets produce what consumers want to buy (a good or service).
Capitalism and market competition fueled the Industrial Revolution.

4. CAPITALISM
Businesses compete with each other for the consumer’s money.
Each business tries to provide goods and services that are better and less expensive than their competition.

5. Capitalism
Joint-stock companies were good examples of capitalistic endeavors and were the first corporations.
Capitalism is based on entrepreneurialism and innovation.

6. Capitalism Adam Smith University professor in Scotland
Supported Capitalism
Wrote “The Wealth of Nations”
Capitalism is what makes people and countries wealthy

7. Capitalism
Laissez faire – letting owners of industry and business set working conditions without interference
No government regulations, such as minimum wage laws

8. Capitalism Positive Effects: Negative Effects:
Competition led to progress
Growth of the middle class
Negative Effects:
Unequal distribution of wealth led to social unrest

9. The Effect of Capitalism:
However, dissatisfaction rose within the working classes (usually factory workers) who saw their bosses growing more wealthy, but their wages were still low.
Working conditions did not improve and a desire for an equal distribution of wealth grew

13. “From each according to his/her ability, to each according to his/her work."
Socialism

14. Socialism
Socialism – an economic system in which the factors of production are owned by the public and operate for the welfare of all.
Theoretically society as a whole makes decisions.

15. Socialism Government actively regulates the economy
Controls major industries and resources.

17. “From each according to his/her ability, to each according to his/her need."
Communism
“The worker of the world has nothing to lose, but their chains, workers of the world unite.” - Marx

18. Communism
Communism – an economic system in which all means of production are owned by the people, private property does not exist, and all goods and services are shared equally.

19. Communism Karl Marx German journalist Radical Socialist
Wrote “The Communist Manifesto”

20. Communism Friedrich Engels
Son of a wealthy German textile entrepreneur
Radical Socialist
Co-Wrote “The Communist Manifesto” and “Das Capital”

22. Communism
In many ways, Communism was a reaction to the Industrial Revolution and Capitalism

23. Communism
The Industrial Revolution intensified class struggle (rich vs. poor)
“Haves” take advantage of “Have-Nots”
Marx and Engels called for workers of the world to unite and overthrow the rule of the rich.

24. Communism Wealth would be redistributed
Classes and private property would cease to exist

27. SOCIALISM and COMMUNISM
Both emphasize the importance of redistribution of wealth.
In both cases, governments own the means of production. In other words, governments own factories and other industries and they set prices and quantities produced.

28. Countries that have tried communism:
Russia (Union of Soviet Socialist Republics)
China
North Korea
Cuba
Countries that have tried socialism:
Great Britain
France
Greece
Sweden
Venezuela
United States?

29. Chart Answers Capitalism Socialism Communism Definition
private ownership and investment of money to make a profit.
factors of production are owned by the public and operate for the welfare of all
all production is owned by the people, not private property, all goods/ services are shared equally
Person Associated
Adam Smith
NONE
Karl Marx
Friedrich Engels
Written Works
Wealth of Nations
Communist Manifesto & Das Capital
Government Involvement
Laissez-Faire – no gov’t regulations
Control of major industry & resources
Control of ALL means of production
Type of Government
Democracy
Dictatorship
Extra Important Details
Joint-Stock Company
Entrepreneur
Importance of redistribution of wealth, gov’t sets prices and quality