Canadian capitalism

What is Capitalism

An economic system where individuals or businesses privately own resources (land, labour, and capital) and make decisions to earn profits

Central features of capitalism

  • Wage labour

    • People getting properly paid for their work

  • Private ownership of the means of production

    • Keeping assets and resources for society to produce (land, labour, capital, infrastructure)

  • Production for exchange and profit

Private property

The legal right to own and use property such as land and buildings

Martin Shkreli

  • an American former hedge fund manager and pharmaceutical executive

  • increasing the price of the life-saving drug Daraprim from $13.50 to $750 per pill

  • Shkreli was later convicted of securities fraud and conspiracy to commit fraud in 2017

Individualism

  • The decision maker in society

  • Is rational

  • Seen to maximize self-interest

Economic freedom

Restrictions on business activity

  • Freedom to enter a business (do i have the resources to start a business)

  • Enter contracts (merging contracts with others)

  • Locate anywhere (branching out, “globalization”)

How is economic freedom measured

  • Property rights

  • Taxation

  • Government intervention

  • Regulations

  • International exchange

  • Foreign investment

  • Money and inflation

  • Wage and price controls

  • Corruption (black markets, lobby/bribing governments)

Systems thinking

  • Looking at the whole system rather than its parts

Atomistic Thinking

  • Temporary solutions

  • Bandaid solutions

  • Shortterm fixes

Consumer Soverignty

Consumers have more power in decision over producers

Role of Government

In perfect capitalism, there would be no government intervention

  • They want to make more money

  • Gives tax

  • Involved in education, social services, welfare, labour law

  • Subsidy: governments provides money for businesses to products goods or services

Pros and Cons of Capitalism

Pros:

  • Economic Efficiency:

  • Consumer Choice:

  • Innovation:

  • Individual Freedom:

Cons:

  • Income Inequality:

  • Market Failures (healthcare and education don’t have enough money)

  • Exploitation of Workers.

  • Environmental Impact.