Many people growing up in the 1980s remember the Cold War between Russia and the United States, two ideologies pitted against each other, a time of tension between the two countries. Baby boomers might remember the Red Scare and McCarthyism. The two economic systems seem to be diametrically opposed. In comparing the architects of the two systems, it is easy to see why there was so much friction between countries that adhered to these economic systems.
Adam Smith, the father of capitalism, explained his vision of capitalism in the 1700s in An Inquiry into the Nature and Causes of the Wealth of Nations. Jack Russell Weinstein conveys that Smith believed that government should not intervene except on three accounts: to protect its citizens from foreign invasion; to protect citizens from each other and deliver justice; and to maintain property and institutions for the public to benefit from and enjoy. This is a laissez faire approach, with as little government intervention as possible in the market, because Smith believed that the market would govern itself (Weinstein).
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This means that everyone has free will to participate in the economic market as they please, and that the forces of supply and demand determine what goods are sold and for what cost. When the supply is plentiful and demand slackens, prices fall, and when demand outpaces supply, prices rise (Comparing Economic Systems). Thus, a working definition of capitalism is, an economic system in which all or most of the means of production are privately owned and operated, and the investment of capital and the production, distribution and prices of commodities (goods and services) are determined mainly in a free market,
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