Definitions of capitalism

"Capitalism" has a variety of different and competing definitions. The following article has a sorted collection.

Contents

1 Dictionaries 2 Encyclopedias 3 Theorists 3.1 Anarcho-capitalists 3.2 Marxists 3.3 Minarchists 4 External links

Dictionaries

Oxford English Dictionary: "The condition of possessing capital; the position of a capitalist; a system which favours the existence of capitalists."

Compact Oxford English Dictionary: "An economic and political system in which a country’s trade and industry are controlled by private owners for profit, rather than by the state."

Merriam-Webster Unabridged Dictionary: "An economic system characterized by private or corporation ownership of capital goods, by investments that are determined by private decision rather than by state control, and by prices, production, and the distribution of goods that are determined mainly in a free market."

Merriam-Webster Collegiate Dictionary 11th Edition: "An economic system characterized by private or corporate ownership of capital goods, by investments that are determined by private decision, and by prices, production, and the distribution of goods that are determined mainly by competition in a free market."

Webster Dictionary of the English Language: "Capitalism is an economic system in which the means of production, distribution and exchange are privately owned and operated for profit."

Riverside Webster's II New College Dictionary: "1. An economic system, marked by open competition in a free market, in which the means of production and distribution are privately or corporated owned and development is proportionate to the accumulation and reinvestment of profits. 2. A political or social system considered to be based on capitalism."

The American Heritage® Dictionary of the English Language, Fourth Edition: "An economic system in which the means of production and distribution are privately or corporately owned and development is proportionate to the accumulation and reinvestment of profits gained in a free market."

The New Dictionary of Cultural Literacy, Third Edition: "An economic and political system characterized by a free market for goods and services and private control of production and consumption."

Random House Dictionary: "An 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, esp. as contrasted to cooperatively or state-owned means of wealth."

Chambers 21st Century Dictionary: "an economic system based on private, rather than state, ownership of businesses, factories, transport services, etc, with free competition and profit-making."

Newbury House Dictionary: "an economic system based on private ownership, competition, and a free market"

Cambridge Dictionary of American English: "an economic system based on private ownership of property and business, with the goal of making the greatest possible profits for the owners"

The Wordsmyth Educational Dictionary-Thesaurus: "an economic system in which the means of production and distribution are privately owned, and prices are chiefly determined by open competition in a free market."

MS Encarta: "free-market system: an economic system based on the private ownership of the means of production and distribution of goods, characterized by a free competitive market and motivation by profit"

The Century Dictionary: "1. The state of having capital or property; possession of capital. 2. The concentration or massing of capital in the hands of a few; also, the power or influence of large or combined capital."

Scott-Foresman Intermediate Dictionary: "an economic system in which private individuals and groups of individuals own land, factories, and other means of production. They compete with one another, using the hired labor of other persons, to produce good and services for profit."

Wordsmyth Children's Dictionary: "an economic system in which land, factories, and other resources are owned by individuals instead of the government. In this system, goods are sold for the purpose of making money."

Allwords.com: "an economic system based on private, rather than state, ownership of businesses, factories, transport services, etc, with free competition and profit-making."

Investorwords.com: "Economic system characterized by the following: private property ownership exists; individuals and companies are allowed to compete for their own economic gain; and free market forces determine the prices of goods and services."

Onlice dictionary of the social sciences: "An economic system in which capital (the goods or wealth used to produce other goods for profit) is privately owned and profit is reinvested so as to accumulate capital. The dynamics of the economic exchange in capitalism are unique. In a barter system of economic activity a producer may grow a pound of potatoes and barter them for an equivalent amount of honey produced by someone else. In this exchange the goods bartered are of roughly equal value. In capitalism, however, a person uses capital to produce goods and then sells those goods for cash. The amount of cash received is greater than the value of the good produced such that a profit is created allowing for reinvestment in the capital stock and to support the owner and producers."

Dictionary of Critical Sociology: "A system which separates workers from any property rights in the means by which they produce culture by their labor. The system transforms the social means of subsistence into capital on the one hand and the immediate producers into wage laborers on the other hand. Most of the time, capitalism is defined as the private ownership of the means of production but that definition does not encompass the great harm done to humanity by the system. By claiming all (or most) of the means to produce culture as private property, a small class of owners preempts material culture to their own comfort while denying the vast majority the means to subsistence as well as the means to produce ideological culture when they are not working."

Economist.com: "The winner, at least for now, of the battle of economic “isms”. Capitalism is a free-market system built on private ownership, in particular, the idea that owners of CAPITAL have PROPERTY RIGHTS that entitle them to earn a PROFIT as a reward for putting their capital at RISK in some form of economic activity. Opinion (and practice) differs considerably among capitalist countries about what role the state should play in the economy. But everyone agrees that, at the very least, for capitalism to work the state must be strong enough to guarantee property rights. According to Karl MARX, capitalism contains the seeds of its own destruction, but so far this has proved a more accurate description of Marx’s progeny, COMMUNISM."

Small-business-dictionary.org "An economic system of government in which 1) private ownership of property exists; 2) CAPITAL ownership can provide income to the owners; 3) relative freedom of competition for economic gain is permitted; 4) the profit motive is basic to economic life. Also called FREE ENTERPRISE SYSTEM."

Oxford Dictionary of Philosophy, ed. Simon Blackburn, 1996: "Mode of socio-economic organization in which a class of entrepeneurs and entrepeneurial institutions provide the capital with which businesses produce goods and services and employ workers. In return the capitalist extracts profits from the goods created. Capitalism is frequently seen as the embodiment of the market economy, and hence may result in the optimum distribution of scarce resources, with a resulting improvement for all; this optimism is countered by pointing to the opportunity for exploitation inherent in the system."

Barron's Dictionary of Finance and Investment Terms: "an economic system in which (1) private ownership of property exists; (2) aggregates of property or capital provide income for the individuals or firms that accumulated it and own it; (3) individuals and firms are relatively free to compete with others for their own economic gain; (4) the profit motive is basic to economic life. Among the synonyms for capitalism are LAISSEZ-FAIRE economy, private enterpreise system, and free-price system. In this context economy is interchangeable with system."

Encyclopedias

Encyclopedia Britannica: "Capitalism - also called Free Market Economy, or Free Enterprise Economy, economic system, dominant in the Western world since the breakup of feudalism, in which most of the means of production are privately owned and production is guided and income distributed largely through the operation of markets."

Columbia Encyclopedia: "economic system based on private ownership of the means of production, in which personal profit can be acquired through investment of capital and employment of labor. Capitalism is grounded in the concept of free enterprise, which argues that government intervention in the economy should be restricted and that a free market, based on supply and demand, will ultimately maximize consumer welfare."

MS Encarta Reference Library 2005 "Capitalism, economic system in which private individuals and business firms carry on the production and exchange of goods and services through a complex network of prices and markets. Although rooted in antiquity, capitalism is primarily European in its origins; it evolved through a number of stages, reaching its zenith in the 19th century."

"under this system a minimum of government supervision is required"

"Merchants and trade are as old as civilization itself, but capitalism as a coherent economic system had its origins in Europe in the 13th century, toward the close of the feudal era."""

Theorists

Economist Alan Greenspan: "Capitalism is based on self-interest and self-esteem; it holds integrity and trustworthiness as cardinal virtues and makes them pay off in the marketplace, thus demanding that men survive by means of virtue, not vices. It is this superlatively moral system that the welfare statists propose to improve upon by means of preventative law, snooping bureaucrats, and the chronic goad of fear." (The Assault on Integrity, 1963)

"Intensive research in recent years into the sources of economic growth among both developing and developed nations generally point to a number of important factors: the state of knowledge and skill of a population; the degree of control over indigenous natural resources; the quality of a country's legal system, particularly a strong commitment to a rule of law and protection of property rights; and yes, the extent of a country's openness to trade with the rest of the world.

"For the United States, arguably the most important factor is the type of rule of law under which economic activity takes place. When asked abroad why the United States has become the most prosperous large economy in the world, I respond, with only mild exaggeration, that our forefathers wrote a constitution and set in motion a system of laws that protects individual rights, especially the right to own property. Nonetheless, the degree of state protection is sometimes in dispute. But by and large, secure property rights are almost universally accepted by Americans as a critical pillar of our economy.

"While the right of property in the abstract is generally uncontested in all societies embracing democratic market capitalism, different degrees of property protection do apparently foster different economic incentives and outcomes." (2004)

Economist Hernando de Soto "Because the West has a property rights system, and property rights systems seem to be about ownership. What we're discovering more and more is that it's really the system that undergirds the system of values called capitalism. In other words, you have property rights in the West. In developing nations we do, too, but they're not legal. Once you legalize them and you have recordkeeping systems and you have tracking systems and you've got contracts and you're able to get all the information about somebody's ownership over an asset, all of a sudden you obtain enormous amounts of data that you do not have in developing nations.

In the West, that is captured in the property system. If you are somebody that is honorable and pays their debts, which is what somebody would be interested in, that's going to be captured in your records, and your records are linked to your property records. All of these are property rights, [but we don't have them] organized in a central system ... in Third World countries."

Political scientist Werner Sombart "Capitalism designates an economic system significantly characterized by the predominance of "capital." "Capitalism and double entry bookkeeping are absolutely indissociable; their relationship to each other is that of form to content" (Der Modern Kapitalismus)

Sociologist Max Weber: "We will define a capitalistic economic action as one which rests on the expectation of profit by the utilization of opportunities for exchange, that is on (formally) peaceful chances of profit...Unlimited greed for gain is not in the least identical with capitalism, and is still less its spirit. Capitalism may even be identical with the restraint, or at least a rational tempering, of this irrational impulse. But capitalism is identical with the pursuit of profit, and forever renewed profit, by means of conscious, rational, capitalistic enterprise." (The Protestant Ethic and the Spirit of Capitalism)

Historian Theodor Mommsen defined capitalism as a system that organizes production for a distant market; where acts of production and retail sale are separated in time and space through the intervention of a wholesale merchant.

Economist, George Reisman: "Capitalism is a social system based on private ownership of the means of production. It is characterized by the pursuit of material self-interest under freedom and it rests on a foundation of the cultural influence of reason." (Capitalism: A Treatise on Economics)

Anarcho-capitalists

Economist Murray Rothbard "we must first decide what the meaning of the term 'capitalism' really is. Unfortunately, the term 'capitalism' was coined by its greatest and most famous enemy, Karl Marx. We really can't rely upon him for correct and subtle usage. And, in fact, what Marx and later writers have done is to lump together two extremely different and even contradictory concepts and actions under the same portmanteau term. These two contradictory concepts are what I would call 'free-market capitalism' on the one hand, and 'state capitalism' on the other. The difference between free-market capitalism and state capitalism is precisely the difference between, on the one hand, peaceful, voluntary exchange, and on the other, violent expropriation."

Marxists

Sociologist Immanuel Wallerstein: "production for sale in a market in which the object is to realize the maximum profit" is the essential feature of a capitalist world-economy. "In such a system production is constantly expanded as long as further production is profitable, and men constantly innovate new ways of producing things that will expand the profit margin"

Anthropologist Eric Wolf defines capitalism in terms of "three intertwined characteristics:"

First, capitalists detain control of the means of production. Second, laborers are denied independent access to means of production and must sell their labor power to the capitalists. Third, the maximalization of surplus produced by the laborers with the means of production owned by the capitalists entails "ceaseless accumulation accompanied by changes in the methods of production" (Sweezy 1942: 94; Mandel 1978, 103-107). (Europe and the People Without History page 78)

Geographer David Harvey defined capitalism in terms of three features: it is growth-oriented ("a steady state of growth is essential for the health of a capitalist economic system"); "growth in real values rests on the exploitation of living labor in production;" and it is "necessarily technologically and organizationally dynamic." (The Condition of Postmodernity page 180)

Minarchists

Economist Milton Friedman: "The possibility of co-ordination through voluntary co-operation rests on the elementary - yet frequently denied - proposition that both parties to an economic transaction benefit from it, provided the transaction is bi-laterally voluntary and informed. Exchange can therefore bring about co-ordination without coercion. A working model of a society organized through voluntary exchange is a free private enterprise exchange economy - what we have been calling competitive capitalism."

Novelist and philosopher Ayn Rand: "A social system based on the recognition of individual rights, including property rights, in which all property is privately owned." - "In a capitalist society, all human relationships are voluntary. Men are free to cooperate or not, to deal with one another or not, as their own individual judgments, convictions and interests dictate."

External links

Definitions of capitalism from diverse sources

Contrast: Definitions of Socialism