How Economic Systems Function: A Comparison Of Traditional, Capitalist, And Marxist Systems Research Paper Samples

There are many different permutations of economic systems in communities, states, and countries throughout the world, but each of these economic systems generally adhere to certain rule sets. These rule sets may differ from place to place, and may affect the ways in which markets interact within certain regions. In the world today, the prevailing form of economic system that is utilized is a capitalistic system of economy; however, there are many different types of capitalist systems, and there are similarly many different ways in which the capitalist system is expressed within a society.
Some of the competing schools of thought are the Marxist economic school of thought and the traditional economic systems and ideas, both of which are very different from capitalism. Just because capitalism is generally accepted as the prevailing type of economic system in the world does not make it perfect, and there are certainly aspects of both the traditional and Marxist economic systems that should be considered as important philosophically as well as economically.
Traditional economies are often the most simplistic. These economies are economies based on the things that the prevailing culture produces—it is sometimes also called a subsistence economy, because it is based off an agricultural model, and does not often produce goods or services that are not fundamentally necessary for the everyday functions of the society at large. Good examples of this type of economy are hard to come by in the world today because of the nature of globalization. However, there are definitely examples that can be seen with the sugar cane plantations of the nineteenth century, as well as older, agricultural-based economies that produced little surplus. These economies were not large, and often did not produce much in the way of surplus; when a surplus of a good was produced, that good was then traded directly for other necessities (Durlauf and Blume 72).
Because of the reliance on what the culture produces, this is often linked with bare subsistence of a culture or a people; it is not a very well developed culture or economy that utilizes traditional economies. This is because traditional economies mostly rely on subsistence living and creation. People and cultures that utilize these types of systems do not often experience much mobility in social class, or much flexibility in choice of occupation (Wolff et al. 17). Most countries are moving away from these types of economies because of globalization; some communities, however, still utilize these types of economies.
Marxist economic theories view economies as a function of the cultures from which they are born (Crittenden and Strike 387). To Marxist economists, everyone should work in common, because the common man owns everything; every worker is joint owner of every factory and farm. Marxist economists believe that the accumulation of wealth in any manner is irresponsible and causes problems within the society.
When Marxist economists describe the perfect economic system, they are usually discussing an economic system in the context of a certain political system; it is impossible to discuss Marxist economic theories without an understanding that the Marxist economy cannot exist without a socialist or communist government (Durlauf and Blume). Without a socialist or communist government, there cannot be a Marxist economy. Marxist economies do not have too many workers; they always have just enough for the economy. This is because everyone who has the ability to work is provided with a job in accordance with his or her abilities and skills. Marxist economic theory was largely a response to the crisis that Marx and the philosophers who agreed with him saw with capitalism, however, and is largely formed by what Marx and his peers viewed as the fatal flaws of the capitalist societies (Screpanti and Zamagni 34).
Capitalism is the most common economic theory that is in place in the world today. Capitalism relies on the exchange of goods and services for capital, like most other economic systems—however, in a capitalistic system, the exchange of goods and services and the business world as a whole is largely privatized. The purpose of privatization is to allow people to accumulate wealth and make profit off of the sale of goods and services. Most countries and economies around the world have some form of capitalism in place, although there are varying levels of hybridization in economies, especially economies where many of the major industries are state-owned (Crittenden and Strike 387). For instance, China’s economy has accepted capitalism in many sectors, but the state still owns many of the companies that operate on the global stage.
It is difficult to distill the global economy into one system, and it is even harder to talk in general terms about economies of the world, because they vary so much from place to place. However, most countries have adopted varying levels of capitalist economic theory, even if they tend towards socialism or communism politically, or even if they maintain traditional agrarian cultural roles.

Works Cited

Crittenden, Brian, and K. A. Strike. 'Comparing Liberal And Marxist Theories'. Curriculum Inquiry21.3 (1991): 387. Web.
Durlauf, Steven N, and Lawrence Blume. The New Palgrave Dictionary Of Economics. Basingstoke, Hampshire: Palgrave Macmillan, 2008. Web.
Screpanti, Ernesto, and Stefano Zamagni. An Outline Of The History Of Economic Thought. Oxford: Oxford University Press, 2005. Web.
Wolff, Richard D, and Stephen A Resnick. Contending Economic Theories. Cambridge, Mass.: MIT Press, 2012. Web.