Authors: Kuper & Kuper
Summary: In about 1,375 words, this entry defines capitalism from a variety of historical perspectives, discusses Karl Marx's theories, describes capitalism's historical origins, and notes the major historical and contemporary intellectual debates surrounding the concept.
The term capitalism refers to a specific system of socioeconomic organization. The precise definition of capitalism depends upon the historical and polemical vantage point of the writer. The entry provides examples of this phenomenon. Most scholars who write about capitalism have been influenced by Karl Marx. For Marx, capitalism is a mode of production comprised of two producing classes: the capitalists and the laborers. The capitalists own the means of production while the laborers, on the other hand, sell their labor for wages in the free market.
According to this perspective, capitalism was born when an entrepreneur class arose that possessed enough capital to mobilize a large body of workers. The entry dates capitalism's birth to the late sixteenth and early seventeenth centuries in England and Holland--just prior to the industrial revolution. During this time, both countries experienced economic developments that encouraged growing capitalist tendencies.
Intellectual debates have surrounded the concept of capitalism since it was born. Orthodox economic theorists believe the concept is too broad because it acknowledges the social relations of production. Modern debates center on whether or not socialism provides a viable alternative to capitalism. Marxists claim that capitalism is inherently unstable and will eventually be displaced by socialism.