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Capitalism is a system characterized by extensive private ownership open to new capital in the form of ideas, firms and new investors.1 Is practically dynamic in terms of innovations, and it has a role in financial stability, job security and the position of the disadvantaged in…
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Download file to see previous pages... Karl Marx was a political economist, a communist who expressed concern over the struggle of the disadvantaged and the need for having in place a revolution of the proletariat. In a society that took the direction of private property, accumulation of capital and wealth, wage labor and pretty competitive markets, Marx held that “capitalism divided people into two main classes, each with its own economic interests and social status: the capitalists, who owned industrial machinery and factories, and the proletariat, consisting of wageworkers who had only their labor to sell.”2 He asserts that “ intense competition between capitalists trying to realize a profit resulted in ruthless ex- ploitation of the working class.”3 The working majority are left at the mercy of the wealthy, which set the wage limits and the prices for transaction of goods and services.4 He disagrees with Adam smith who saw capitalism as an element that would enhance division of labor and bring about specialization among the workers, improve their skills and better production, and consequently earn more from their rendered service.5
Marx felt that capitalism would open doors for monopsony exploitation.6 The degree of inequality between the owners of capital and the disadvantaged is big enough to subject them to circumstances where they can only work to earn a living. Capitalism disfavors them as just a few own capital in the society while the vast majority of the population lacks self-sustenance and have to be dependent on the wealthy. This leaves them vulnerable and are exploited by the capital owners as they earn little relative to what they do for the firm. Thorsten Veblen looks at the workers and the capitalists at different angles. Like Marx, he is not impressed with the few individuals who took charge of the entire production process and used their position to exploit the less fortunate.7 They would take advantage of the disadvantaged to generate income that would ...Download file to see next pagesRead More
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