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Difference Between Communism vs. Capitalism

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There are different operations, strategies, beliefs, and principles that guide every economic structure. The principles and ideas that are dominating in such territories determine the type of system in operation. Capitalism vs. communism concepts are two contrasting economic systems that are applicable in different places. Indeed, the difference between communism and capitalism is that the former supports equality in society by making economic services owned and controlled by the community. In contrast, the latter seeks to privatize production activities. However, this article will explain more about this discussion.

Communism is a socio-economic structure that supports equality in society. In other words, everyone has a balanced and equivalent level of right to every productive activity and decision. Irrespective of individual contributions, the profit or returns are usually shared equally. In such communities, properties and production activities are equally owned by every member of the society. It could also be referred to as the state-controlled or government economy. However, if it will be described in its real sense as any form of governance wouldn’t exist; no superiority or controlling power is involved. Everyone simply has the common ability and power to make decisions and take similar rewards. The primary aim is for sustainability and survival, so every member of the society simply co-operates to ensure the continuity of society. In fact, no form of privatization exists in communism.

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Capitalism is the type of socio-economic system whereby economic activities and ownership are mainly owned and controlled privately. In other words, there is no governance or state ownership. Well, certain individuals control production activities for the purpose of making a profit. Also, this could be described as a system that is characterized by a free market operation. Here, the only contribution of the government is to ensure that appropriate checks and rules exist to regulate the system. More often than not, there is always a very high market competition in such systems that are accompanied by social disparities in terms of product and prices. Sure, any capitalist system aims to make profit. This will ensure efficiency in production since every producer will be willing to have the best rate of demand for its product.

  1. Main Differences between Communism vs. Capitalism
  2. The table further shows the major disparities between them
  3. S/N Basis of comparison Communism Capitalism
  4. Meaning It is a socio-economic structure that supports equality in the society. It is the type of socio-economic structure whereby economic activities and ownership are majorly owned and controlled privately.
  5. Purpose Social satisfaction Profit making
  6. Market Structure There is no free market There is a free market.
  7. Market distribution The goods or profits are shared equally, regardless of contributed effort. It is primarliy determined by individual choices.
  8. Process of change The key agent of change is the governing body rather than market interaction. The effect of such changes could be slow. Market forces of demand and supply determine the level of change in price and quantity. Similaly, changes are made effective quickly.
  9. Production It is determined by the societal needs and what is available. Based on demand and supply.
  10. Political system This system is controlled directly by people in an equal manner but with a selected body to govern and regulate the system. This can be operated in anarchism, direct democracy or dictatorship system of politics.
  11. Economic decision Financial and monetary decision is based on societal needs. Decision is made by the forces of demand and supply, and partly by regulating rules and policies imposed by the governing body.

In summary, the communism vs. capitalism concepts have clear disparities that are based on societal nature and demands. Without a doubt, the former regards every production service to be owned by the community, whereas capitalism privatizes production services in the economy. These systems also allow governance except in a clear or strictly communized economy. Without looking at other variations, this forms the key difference between capitalism and communism. Since market and production services are privately owned in a capitalist system, then it is expected that everyone works independently. In a similar vein, wealth is expected to be shared based on the needs of society and available resources.

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Difference Between Communism vs. Capitalism. (2022, September 15). Edubirdie. Retrieved February 1, 2023, from
“Difference Between Communism vs. Capitalism.” Edubirdie, 15 Sept. 2022,
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