5 ms·

> Because it's based on the idea of exponential growth. Except it isn't. It's based on the expectation that the market will allocate resources based on factor

by Mikeb85 13y ago

> Because it's based on the idea of exponential growth. Except it isn't. It's based on the expectation that the market will allocate resources based on factors like supply/demand. We focus on growth because it's a human tendency to always want more. Has nothing to do with capitalism.

chongli 13y ago
No, you've got your definitions mixed up. You're talking about the free market. Capitalism is about capital; that is, investment with the goal of profit. The only way to sustain continued investment and subsequent profit is to have growth.
- ahomescu1 13y ago
  > Capitalism is about capital; that is, investment with the goal of profit. Arguably, "investment with the goal of profit" is a basic process of human nature (in all human activities). It's not restricted to capitalism, this is how we humans operate generally.
- Mikeb85 13y ago
  Capitalism and the free market are synonymous with each other. In a free market, you sell goods produced with capital (ie. labour, resources, which are purchased with money, or your own time), and you make money (aka. profit). In the most basic of examples, let's say I'm a farmer. I plant some seeds, take care of them, harvest the grains, and then sell them. My capital is whatever seeds I planted, and the labour I used to raise them, then harvest them. What I get paid is my revenue, and the amount of money that I'm compensated that goes beyond the minimum required to produce my goods is my profit. Heck, even if I didn't sell my grain, you could say whatever I produced is my revenue, and whatever's left in my silo beyond what I will eat before next harvest is my profit... Capitalism doesn't require endless growth because, strictly speaking, you don't need to constantly increase revenue (grow your business) to have profit. Japan's economy went through decades of no growth, yet companies survived, and Japan is still a bastion of capitalism. And of course, this is still leaving out a big part of the equation - efficiency. It's possible that in the future we'll still grow economically while not using up any additional resources depending on how technology progresses... Today we certainly are more efficient than 100 years ago, both in terms of resources and labour.

by Mikeb85 13y ago

chongli 13y ago

No, you've got your definitions mixed up. You're talking about the free market. Capitalism is about capital; that is, investment with the goal of profit. The only way to sustain continued investment and subsequent profit is to have growth.

ahomescu1 13y ago
> Capitalism is about capital; that is, investment with the goal of profit. Arguably, "investment with the goal of profit" is a basic process of human nature (in all human activities). It's not restricted to capitalism, this is how we humans operate generally.
Mikeb85 13y ago
Capitalism and the free market are synonymous with each other. In a free market, you sell goods produced with capital (ie. labour, resources, which are purchased with money, or your own time), and you make money (aka. profit). In the most basic of examples, let's say I'm a farmer. I plant some seeds, take care of them, harvest the grains, and then sell them. My capital is whatever seeds I planted, and the labour I used to raise them, then harvest them. What I get paid is my revenue, and the amount of money that I'm compensated that goes beyond the minimum required to produce my goods is my profit. Heck, even if I didn't sell my grain, you could say whatever I produced is my revenue, and whatever's left in my silo beyond what I will eat before next harvest is my profit... Capitalism doesn't require endless growth because, strictly speaking, you don't need to constantly increase revenue (grow your business) to have profit. Japan's economy went through decades of no growth, yet companies survived, and Japan is still a bastion of capitalism. And of course, this is still leaving out a big part of the equation - efficiency. It's possible that in the future we'll still grow economically while not using up any additional resources depending on how technology progresses... Today we certainly are more efficient than 100 years ago, both in terms of resources and labour.