Free-Market Capitalism

Definition

Free-market capitalism is an economic system based on private ownership of resources and businesses, where prices are determined by supply and demand rather than government control. It allows individuals to make economic decisions independently.

Related terms

Laissez-Faire Economics: A philosophy that promotes minimal government intervention in the economy, allowing free markets to operate without heavy regulation.

Invisible Hand: The concept that in a free-market capitalist system, self-interests of individuals lead them to act in ways that benefit society as a whole.

Profit Motive: In free-market capitalism, entrepreneurs are driven by the desire for profit as an incentive for innovation and productivity.