A Mixed Economic System Would Benefit the United Kingdom

A Mixed Economic System Would Benefit the United Kingdom

Two main economic systems have been developed since the Industrial Revolution, these are Capitalism and Socialism. Both systems have advantages and disadvantages, this essay will explain these, and also give my proposals for a mixed system for the whole society of the United Kingdom.

Capitalism

Capitalism generally started as an economic system in the United Kingdom at the time of the Industrial Revolution. The basic explanation of Capitalism would be to say that 'the economy is left to its own devices with no Government intervention'. A Capitalist economy is a market economy where all economic decision making is decentralised, and the Government will only supply national defence, administer justice and provide certain public works. The goods that are provided in a Capitalist economy are decided by individuals who choose how to use their labour and spend their income. All resources are privately owned and will only be used for obtaining the highest profit. Advantages of Capitalism There are many advantages to a Capitalist economic system which could make it very appealing to society. The system allows the powers of market forces to operate which in turn gives the consumer a wider range of goods and services. Also because producers are always seeking the highest profit they must try to please the consumer and win their custom.

This leads to innovation and greater quality and variety. The firms which produce the correct goods and services will win custom and make profit, those which don't will go out of business and therefore release their resources to the successful firms. This will lead to the expansion of the economy and greater prosperity. In summing up the advantages, it is clear to see that the consumer has the power to dictate the goods in the economy. Disadvantages of Capitalism As discussed in the advantages of Capitalism the consumer has all the power in the economy. However individuals purchasing power is drastically unequal because of the inequality of wealth within the economy. This is due to the fact that some people will always be able to work harder, be more innovative and be more talented than others, and therefore be more profitable and promote themselves higher in the economy whilst others will fail. Because of the inequality of wealth in a truly Capitalist society with...

... middle of paper ...

... Since the war the Government has still kept a lot of control but the opportunity for entrepreneurship is available. The economy in the United Kingdom is, as far as I can see, the only way a society can flourish. The Government tax people but provide, health care, infrastructure, education and welfare as well as owning certain industries to keep some form of economic planning available to them. However recently the Government has sold off a lot of nationalised industries and this has allowed for more competition and moves the economy in to a more Capitalist state. Conclusion In a Capitalist society there is great suffering because of the great inequality but in a Socialist society it seems that, even though the idea of everyone living equally in harmony is appealing, the fact of the matter is that the only equality that people will share is the equality of no choice and oppression. True Socialism can never work in any society because it is human nature to want mare than you have and to strive to achieve this. Countries that say they are socialist seem to me to be more of a dictatorship. A true mix between the two must be achieved to sustain a healthy economy and a happy society.