Capitalism vs. Communism: What’s the Difference?
The main difference between capitalism and communism is that under capitalism, private individuals or businesses own and control the resources whereas under communism, the state or community owns and controls the resources.
Before we move to more differences, let’s first understand Capitalism and Communism:
- Capitalism: Capitalism is an economic system where private individuals or corporations own and control the means of production and distribution of goods and services.
- Communism: Communism is a socio-economic ideology that aims for a classless society with common ownership of the means of production.
Now, let’s get to Capitalism vs Communism:
Major differences between Capitalism and Communism
| Capitalism | Communism |
|---|---|
| In Capitalism, the focus is on creating profits and competition. | In Communism, the focus is on creating a classless society where everyone is equal. |
| Capitalism encourages innovation and entrepreneurship. | Communism discourages these things in favor of collective ownership and decision-making. |
| In Capitalism, prices are determined by supply and demand. | In Communism, prices are set by the state or community. |
| Capitalism allows for income inequality. | Communism aims to eliminate it. |
| In Capitalism, individuals have the freedom to choose their occupation and pursue their own interests. | In Communism, the state assigns jobs based on the needs of the community. |
So, these are the main differences between the entities.
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