CapitalisM

A system based on the absence of political intervention in the economy, which rests on the assumption that politics and economics are distinct from one another. Recently, capitalism has often been discussed in the context of a wider, LibertariaN? social theory that advocates the absence of political intervention in most aspects of society.

A capitalist economy has many features, including businesses operating on the profit motive, large scale trade, and prices that fluctuate in response to changes in supply and demand. Some people consider any economy that prominently exhibits such features to be a capitalist economy, regardless of the degree of political intervention. Typically when people define capitalism in this way they are denying or not recognizing the distinction between politics and economics.

No economy in history has been purely capitalist in the sense of having a complete absence of political intervention. In fact, the idea that an economy could be free of political intervention apparently did not occur to anyone until the late 18th century. This makes capitalism one of the more radical ideas in human history.

Capitalist economic theory was first formalized by AdamSmith? in 1776, in an attempt to refute MercantilisM?. In his work, Smith first presented his idea of MarkeT?, that is central to EconomicTheory?. Other prominent capitalist theorists include DavidRicardo?, LudwigvonMises?, FreidrichHayek?, and MiltonFriedman?.

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See CapitalismTalk