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What are some benefits of capitalism?

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Quick Answer

Some benefits of capitalism are abundance of wealth, free trade, democratic compatibility, consumer choice and better living standards. Capitalistic markets are characterized by open trade and consumption of goods and services. In this system, goods and services are privately owned, and the government plays a limited role in controlling the flow and exchange of currency.

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Full Answer

Capitalism tends to generate more wealth because the markets aren't constricted by governmental entities. Free trade encourages healthy competition and gives companies an incentive to innovate and create better and more efficient goods and services. Capitalism is compatible with democracy because democracy values many freedoms that capitalistic societies offer. For example, democracy values the freedom of choice, and this is also an essential component of capitalism.

A staple of capitalism is consumer choice. Individuals have the freedom to choose and purchase goods and services they want. This helps promote higher quality products because companies strive to attract and keep their customers happy. Capitalism helps improve the overall living standards because the uninhibited flow of money help lead to economic growth. Economic growth is always beneficial because individuals have access to more jobs and higher wages. Some capitalistic countries are the United States, United Kingdom, Canada, Sweden and Australia.

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