Blackwell Reference Online

Extract

A system based on market competition, under which the means of production, distribution, and exchange are controlled by private owners for profit. This mode of economic and social organization has been generally predominant in modern Europe, and provides the basis upon which most of continental and British industrialization has been achieved since the late eighteenth century. However, the system was very directly challenged by the ideology of communism , and by the consequent attempt made during much of the twentieth century to practise radically anti-capitalist principles in the soviet union and (after 1945) elsewhere in eastern Europe too. Less extreme brands of socialism , on the other hand, have often accepted the necessity of compromise with a capitalist system that has demonstrated considerable resilience. Max Weber's influential proposition that Western capitalism, in its modern form, drew much of its inspiration from protestantism (and most notably from the Calvinist ethic that prioritized reinvestment not conspicuous consumption) serves as one reminder that the pursuit of private profit was firmly established as a central component of European economic growth even before the later eighteenth century. That was, however, the epoch at which Adam Smith's The Wealth of Nations (1776) provided the most significant theoretical articulation of claims concerning the fundamental ... log in or subscribe to read full text