ANALYTICAL ISSUES ARISING FROM CAPITALISM

Main Analytical Issues Arising Out Of Investigation Of The Origins Of Capitalism

Main Analytical Issues Arising Out Of Investigation Of The Origins Of Capitalism

Introduction

Capitalism is an economic system grounded in the concept of free enterprise, and, in American culture, it is generally considered fundamental to national identity and prosperity. It is based upon the theory that economies should be market driven, with private owners or suppliers providing products and services at whatever cost consumer demand makes feasible. Motivated by the potential for profits, private owners and investors will presumably produce whatever commodities are required or desired by a population willing to pay enough to make the investment worthwhile. This economic system assumes that the investment of capital and the employment of labor will keep the national economy strong with little or no government intervention. This paper discusses main analytical issues arising out of investigation of the origins of capitalism in a concise and comprehensive way.

Discussion

Rothschild (2001) mentions in theory, capitalism should be genderless, rewarding the incentive and inventiveness of any individual. In practice, it has usually benefited men, whose capital and position as heads of households have given them a clear advantage in dealing with market issues, and it has been crucial in defining manhood for economically successful males. In addition, by placing work and earning as central male virtues, capitalism has often treated consumption as a female activity, perhaps even a female weakness (Rothschild, 2001).

In 1776, the Scottish moral philosopher and economist Adam Smith published The Wealth of Nations, the pioneering text on capitalism. This treatise on free trade and market economics challenged the restrictive system of mercantilism, insisting that the principles of free competition and choice were the keys to economic development (Rothschild, 2001). These ideas were widely embraced in England, Europe, and the United States during the Industrial Revolution in the eighteenth and nineteenth centuries. As a new bourgeoisie developed, with bankers, merchants, factory owners, and professionals displacing the aristocracy as the most economically and, hence, politically and socially powerful community, the advantages of capitalism seemed evident. The laws of supply and demand would create an opportunity for all men to become prosperous, regardless of their station at birth—a prospect that became closely tied to American notions of an ideal democratic political economy. These men would then be able to demonstrate their manhood by achieving economic success and fulfilling their roles as financial providers for the nuclear family. Furthermore, Smith's perception of capitalism as a system driven by rational decision making, combined with the tendency of Enlightenment thought to associate rationality and public economic activity with manhood, reinforced the association of capitalism with male endeavor in European and American thought (Rothschild, 2001).

The move away from hereditary wealth toward entrepreneurship and professionalism had the potential to expand opportunities for common people and women (who had most often been ineligible to own property). However, for moneyed men, who had access to the franchise (the right to vote) and professional training, the possibilities seemed ...