Sociology Essay Example | Topics and Well Written Essays - 1000 words - 10

Sociology - Essay Example It is the separation of economy and state† (Capitalism, socialism and Mixed-Economy, 2007). According to Przeworski (1990) capitalist economic system working under a totalitarian political one is possible. In most cases, capitalism requires a democratic political system in which to function. Likewise a socialist economic system can be either part of Communism or Socialism. Thus capitalist economic institutions under totalitarian governments (for instance, Fascist or Communist) become generally more centralized, more planned, and rely less or not at all on a free market. Capitalism, therefore, requires a democratic political environment if it is to exist and function. It should be recognized that state ownership, and control, and planning produce a bureaucracy and power situation which may latently provide the basis for totalitarianism. Socialism means †control of property is put into the hands of society as a whole† (Capitalism, socialism and Mixed-Economy, 2007). The classical argument for the perfectly competitive, and free market has therefore been under considerable attack for some years. The weak point of socialist system is that it rests on collectivism which limits free market operations and economic performance. One of the most obvious features of collectivism as an economic system is the absence of the right of private persons to hold property. Property rights of a sort might exist under an absolute dictatorship to the extent that the dictator personally controls all resources in the economy, which he would then regard as his personal property. In a collectivist society there are no market prices to help guide the dictator by serving as indicators of expected benefit and expected cost, and enabling him objectively and meaningfully to record the benefits and costs of each undertaking. A ‘mixed economy’ is a combination of capitalism and socialism which help to achieve the best economic