Capitalism and Its Struggle in Developing Countries
Capitalism and its Struggle in the Developing Countries
Since the development of civilization, more than 5000 years ago, some type of economic system has always been applied. Resources have been scarce and people always have had to decide how to allocate their resources in the best manner. To this day, people have tried many different systems. However, systems as feudalism and mercantilism belong to the past. During more recent times there have been two competing systems, the capitalist system of the west and the communist system of the east. But with the collapse of the communist regimes in Eastern Europe in the late 1980’s and early 1990’s there now is only one system still standing. Today there is no argument that capitalism, even if it is not perfect, still is the best economic system to allocate resources, promote economic growth and grant individual liberties. Also, if we look back in the history, the result of capitalism in the west is remarkable. In 250 years we have gone from a society where most people lived on, or just below subsistence level, to the present day where we live in nice homes, drive cars, go for vacations and have a vast array of different goods to choose from. In this perspective, the economic growth of the Western economies is nothing less than astonishing. However, if we turn our eyes to the developing countries the reality is completely different. Two thirds of the world’s population is economically under-developed. More than a billion (1.1 billion 2004) people live in extreme poverty, meaning that they have less than a dollar to live on per day and almost three billion (2.7 billion 2004) live on two dollars a day (Global Issues, poverty facts and stats). One may argue that a dollar has a greater buying power in those countries, but still, for these people their daily situation is more a struggle for survival than a fulfilling of life. The governments in many of these countries realize as well as anybody else that there are no
Since the development of civilization, more than 5000 years ago, some type of economic system has always been applied. Resources have been scarce and people always have had to decide how to allocate their resources in the best manner. To this day, people have tried many different systems. However, systems as feudalism and mercantilism belong to the past. During more recent times there have been two competing systems, the capitalist system of the west and the communist system of the east. But with the collapse of the communist regimes in Eastern Europe in the late 1980’s and early 1990’s there now is only one system still standing. Today there is no argument that capitalism, even if it is not perfect, still is the best economic system to allocate resources, promote economic growth and grant individual liberties. Also, if we look back in the history, the result of capitalism in the west is remarkable. In 250 years we have gone from a society where most people lived on, or just below subsistence level, to the present day where we live in nice homes, drive cars, go for vacations and have a vast array of different goods to choose from. In this perspective, the economic growth of the Western economies is nothing less than astonishing. However, if we turn our eyes to the developing countries the reality is completely different. Two thirds of the world’s population is economically under-developed. More than a billion (1.1 billion 2004) people live in extreme poverty, meaning that they have less than a dollar to live on per day and almost three billion (2.7 billion 2004) live on two dollars a day (Global Issues, poverty facts and stats). One may argue that a dollar has a greater buying power in those countries, but still, for these people their daily situation is more a struggle for survival than a fulfilling of life. The governments in many of these countries realize as well as anybody else that there are no
References: Berggren, Niclas. (2003) “The Benefits of Economic Freedom” The Independent Review p. 193-205 Davis, Kevin E. (2001) “The Rules of Capitalism” Third World Quarterly p 675-682 Manji, Ambreena. (2006) “Legal Paradigms in Contemporary Land Reforms” Commonwealth and Comparative Politics p. 119-130 Global issues, Poverty facts and statistics. Retrieved 04/24/2008 URL: http://www.globalissues.org/TradeRelated/Facts.asp de Soto, Hernando. (2000) The Mystery of Capital: Why capitalism triumphs in the west and fails everywhere else: Lund, Atlantis Weeks, John. (2001) “The Expansion of Capital and Uneven Development on a World Scale” Capital and Class. p. 9-30 ----------------------- [pic]