Difference Between Socialism, Communism and Capitalism – Capitalism vs Socialism vs Communism

Difference Between Socialism, Communism and Capitalism

There is a subtle difference between Socialism, Communism and Capitalism in their ideology, policies, and actions; it is imperative to understand capitalism vs socialism vs communism difference.

• Capitalism is the preferred economic system that brings groups of people out of deprivation or poverty and allows them to evolve as productive individuals in India.
• In brief, Communism backs full control of the Government across all standards of production and other resources.
• Socialism exercises adaptable forms of controlling the State.
• Capitalism supports a free market and overall economy without the involvement of the State.

Capitalism vs Socialism vs Communism

The table illustrates significant differences between Socialist Communist Capitalist countries based on their ideology, religion, origins, welfare system, and ownership of economic resources.

Difference Between Socialism, Communism and Capitalism
Communism	Capitalism	Socialism
It promotes state control of economic resources and the means of production.	It favours the concentration of wealth and means of production in the hands of private individuals.	Emphasizes state control of economic resources within reasonable limits.
There is complete state intervention in terms of economic policies.	There is no state intervention as it follows the ideal of laissez-faire.	State intervention exists but leaves some scope for individual intervention as long as it follows the fair distribution of economic resources.
Static economic system.	Dynamic economic system.	Flexible economic system.
The end goal of communism is to establish a communist egalitarian order, usually through revolutions or authoritarian regimes.	Capitalism strives to create a free society, economy, and market in sync with democratic and liberal ideals.	Socialism does not necessarily aim for the establishment of communist order. It can exist along with capitalist programs, thereby creating a mixed economy.
Founded in 1848 by the German Philosopher Karl Marx (May 5th, 1818 – March 14th, 1883).	Started in the early Renaissance generation between the 15th and 16th Centuries.	More noticeable towards the 18th-century end and after 1848.
Religion is effectively nullified.	Unconcerned towards religion, but preference exists towards well-off or rich religious groups.	Freedom of religion is permitted.
Supports universal social welfare with a focus on public education and health.	The welfare system is open only to wealthy people who can pay for their services.	The state concentrate on society’s welfare without any discrimination.

Socialism vs Communism

Communism and socialism difference is based upon several criteria, including the type of ownership, equality, taxes and prices, healthcare and so on. Communism vs Socialism basic comparison is illustrated below.

Socialism and Communism
Socialism	Communism
People may own possessions and small enterprises. State ownership of elementary services (water, electricity, internet)	Complete elimination of property rights – no Personal land ownership. No financial incentives to individually own
Redistribution of revenue to create equal classes. Entire liberty of religion	All are treated equally under the government except for the ruling class.
High taxes concentrated on social services or welfare state.	High, rigid tax rates concentrated on redistributing funds to central power

Communism vs Capitalism

Communism favours cooperative ownership and limits the free market with government interference depicting a prepared economy. In comparison, capitalism is an economic system that permits private ownership and encourages the notion of a free market.

Difference Between Communism and Capitalism
Communism	Capitalism
Some notable figures of Communism are: Fidel Castro, Joseph Stalin, Karl Marx, and Vladimir Lenin	Some notable figures of Capitalism are: Adam Smith, George Washington, Ronald Reagan
Available to everyone but circulated unequally among the poor. Employed by the federal government	Selected by market – significantly less or no government regulation.
Prices are specified by the government, which manages supply and demand to maintain pricing artificially.	Consumers/companies fix prices through supply and demand. Competition brings with it lower costs and more profitable products.

Socialism, Communism and Capitalism

Political philosophies have been an integral part of improvement since ancient times. They help us comprehend the justifications for the steps taken by the people that affected the international political structure. Read further to compare and contrast Socialism, Communism, and Capitalism.

What is Socialism?

Socialism advocates for communal social ownership of the means of production in the form of public, collective, or cooperative, in contrast to private ownership, as presented under capitalism.

• It favors government control of everything, from the economy to production and output.
• Moreover, the government engages in social welfare initiatives to ensure equitable distribution of wealth and equal opportunities for all.
• However, it is a broader concept than Communism, as it functions in a democratic setup.
• No encouragement for competition, commitment to social equality, public or government-run system, offering fundamental needs, and regulating prices are the basic characteristics of Socialism.

Nations are described as socialist unless they declare so in their constitution or via their federal name. A few governments to claim themselves socialists are given below.

• Portuguese Republic.
• The Democratic Socialist Republic of Sri Lanka.
• The Republic of India.
• The people’s Republic of Bangladesh.
• The Cooperative Republic of Guyana.
• The people’s Republic of Mozambique.
• The Republic of Angola.

What is Communism?

Communism originates from the French word communism, which means of or for the community. It favors state ownership of economic resources, policies, and means of production.

• Moreover, Communism favors the absence of private property, established in a revolutionary way.
• Communism as an ideology found scholarly elaboration in the writings of Karl Marx and Friedrich Engels.
• The characteristics of Communism include a classless society, joint ownership of all resources, owning private property, standing socially equivalent, and being against democracy.
• China, Laos, North Korea, Vietnam, and Cuba, are five examples of Communist countries that exist currently.

What is Capitalism?

It commenced in the early modern era, resembling the 16th and 18th centuries. Capitalism, as a monetary ideology, concentrates on the notion of –

• Free trade.
• Free markets.
• Profits.
• Private control of resources and production means.
• Entrepreneur-wage laborer-based relations of production.

Some examples of capitalist economies include the United Arab Emirates, the United Kingdom, New Zealand, Hong Kong, Canada, the United States, Ireland, Singapore, Australia, and Switzerland.

The emergence of capitalism underwent three stages –

• Merchant capitalism.
• Industrial capitalism.
• Financial or imperial capitalism.

It gradually transformed into global capitalism based on ideas of free trade and laissez-faire, also known as Neoliberalism, that we encounter today.

Conclusion:

Key Difference Between Socialism, Communism and Capitalism

To sum up, the key difference between Socialism, Communism and Capitalism is that Socialism permits freedom of religion, Communism effectively nullifies religion, and Capitalism is unconcerned towards religion.

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