com) is an economic system in which the means of production and distribution are privately or corporately owned and proportionate to the accumulation of profits gained in a free market. This means that business is fun by the owner with little control from the government. It is based on a lasses-faire system of leadership where the employee's have freedom from the initiation of force in the workplace. All employers have to respect the individual rights of their employees. The idea of capitalism stemmed from Europe in the 19th century. It has several key characteristics that define it. First, basic production facilities such as land and capital are privately owned. Second, economic activity is organized and coordinated between the buyers and the sellers in markets. Third, owners of the land and capital as well as the workers they employ are free to pursue their own self interest in seeking maximum gain from their resources and labor in production. This means that consumers may spend their incomes in whatever way they wish, which is a principle called consumer sovereignty. This principle reflects the idea that under capitalism, producers will be forced by competition to use their resources in ways that will most efficiently satisfy the desires of the consumers. Which allows self-interest to drive the economy. The fourth characteristic of capitalism is that there is a minimum of government supervision required. If competition is present, the activity of the economy will be self-regulating. Government action is only necessary when needed to enforce the rights of private property and to guarantee contracts. Our economic system as we know it today was based upon Adam Smith's book The Wealth of Nations. One of Adam Smith's most important thoughts was "Business should be regulated, not by the government, but by the invisible hand of the law of supply and demand." This means letting businesses run with limited government regulations and allowing the citizens, for the most part, to determine how the economy will prosper.
