What is the difference between capitalism and socialism?

Capitalism and socialism are economic systems that countries use to manage their economic resources and regulate their means of production. Capitalism is based on individual initiative and favors market mechanisms over government intervention. Socialism is based on government planning and limitations on private control of resources.

How does capitalism affect socialism?

Capitalism is most often criticized for its tendency to allow income inequality and stratification of socio-economic classes. Socialist governments strive to eliminate economic inequality by tightly controlling businesses and distributing wealth through programs that benefit the poor, such as free education and healthcare.

Is capitalism a social system?

Capitalism is an economic system under which the means of production are privately owned. Production and consumer prices are based on a free-market system of “supply and demand.” Socialism is most often criticized for its provision of social services programs requiring high taxes that may decelerate economic growth.