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Unregulated capitalism

Q1. What are the drawbacks of unregulated capitalism ?

A democracy is portrayed as government by the majority that offers fairness and equal economic opportunity. However, Americans are now left with a democracy and economic system of, by, and for the country’s wealthy, elite, and large corporations. With an extreme income and wealth disparity between the “haves” and “have-nots,” what the country needs now more than ever is a true democracy with a fair and equitable economic system. With this fascinating new book, readers will finally understand why the solution to rampant capitalism is a revamped social capitalism approach that will lead every democratic nation toward a purer form of democracy. 
Unregulated Capitalism: Unregulated Capitalism is Destroying Democracy and the Economy is an eye-opening look at the need for democratic countries to replace unfettered capitalism with social capitalism.
Offering an alternative to unregulated and rampant capitalism, this book explains the need to fix the problems that are always present when capitalist systems are left unregulated and at the mercy of greed. Inspired by his time spent working with government programs and in Washington, author George Gaasvig created Unregulated Capitalismafter coming to the stark realization that many people fail to notice the shocking disparity between the wealthy capitalist elite and the working class. Furthermore, most people don’t even understand the workings of the economy or democracy in general. Serving as a thought-provoking and informative resource, this excellent guide is perfect for anyone who is concerned about the plight of their country. In an effort to identify the problems facing democratic nations while providing effective solutions, Unregulated Capitalism informs readers all over the world of the rampant problems that come with unfettered capitalism.
By allowing capitalists to profit from greed beyond need or reason, unrestricted capitalism cripples the economic system of democratic nations and jeopardizes the futures of countless readers. Utilizing ingenious and oftentimes common sense solutions, this captivating guide urges readers to do their part in fixing the problems that plague their nation. An educational and stimulating read, Unregulated Capitalism has the potential to reshape the future of not only capitalism but entire nations.
DRAWBACKS of Unregulated Capitalism
• Monopoly power : Private ownership of capital enables firms to gain monopoly power in product and labormarkets. Firms with monopoly power can exploit their position to charge higher prices.
• Monopsony power : Firms with monopsony power can pay lower wages to workers. In capitalist societies, there is often great inequality between the owners of capital and those who work for firms. 
• Social benefit ignored : A free market will ignore externalities. A profit maximizing capitalist firm is likely to ignore negative externalities, such as pollution from production; this can harm living standards. Similarly, a free market economy will under-provide goods with positive externalities, such as health, public transport and education. This leads to an inefficient allocation of resources. Even supporters of capitalism will admit that government provision of certain public goods and public services are essential to maximize the potential of a capitalist society.
• Inherited wealth and wealth inequality: A capitalist society is based on the legal right to private property and the ability to pass on wealth to future generations. Capitalists argue that a capitalist society is fair because you gain the rewards of your hard work. But, often people are rich, simply because they inherit wealth or are born into a privileged class. Therefore, capitalist society not only fails to create equality of outcome but also fails to provide equality of opportunity.
• Inequality creates social division : Societies which are highly unequal create resentment and social division.
• Diminishing marginal utility of wealth : A capitalist society argues it is good if people can earn more leading to income and wealth inequality. However, this ignores the diminishing marginal utility of wealth. A millionaire who gets an extra million sees little increase in economic welfare, but that £1 million spent on health care would provide a much bigger increase in social welfare.

SUBMITTED BY- GURLEEN KAUR 
                            MBA I
SUBMITTED TO -MR GURDEEPAK SINGH

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