What Are The Disadvantages In A Capitalist Economy?
Many economists criticized Market capitalism for the following reasons: 1. As previously mentioned, the production of the capitalism market is directed according to consumers’ preferences. Those are the preferences of a certain class that has money to spend. By reflecting only the preferences of that class, the production is neglecting the preferences of the other class that doesn’t’t have money to spend. This would lead to a dangerous phenomenon called “social class alienation”. 2. Monopoly may arise because restricted competition; as a result prices would increase. 3. Because the government in market capitalism doesn’t’t set rules and regulations for business owners, this would make the economy driven by the individuals profit motives, which will increase prices of goods and services.
