The Pros And Cons Of Capitalism

Decent Essays

In this essay arguments for capitalism as the dominant economic system, and the role that accountants can play in improving this system is discussed. Capitalism is defined as “An economic and political system in which a country's trade and industry are controlled by private owners for profit, rather than by the state. ‘an era of free-market capitalism’ “ (Anon., 2017).
After the first war capitalism had a solid reputation by restoring price meganisms internationally. However, Britain`s state proved to be too strong for the health of the British economy and a deflation policy was introduced to bring down British prices and costs to the American level. Only in 1920 Britain managed to achieve stable prices but, the economy never recovered fully from the double blow once-off increase in unit costs in 1919 and a prolonged dose of money (1920-1922). The Great depression followed in 1929 which was the greatest peace breakdown of the economy worldwide after the industrial revolution. During this period, the GDP fell 20% by its volume and the economy started to disintegrate under strain of the collapse. Lenin`s new Economic Policy (NEP) helped relieve some strain in 1921 because it sanctioned the revival of capitalism which became part of the economy again in 1929. 1930 marked a general retrogression in economic life by the replacement of the economic mechanisms by Autarkic policies. Still the Gold standard & multilateral clearing system collapsed in 1931. Tariffs, exchange controls,

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