chapter  1
30 Pages

Capitalism

ByWerner Sombart

The concept of capitalism and even more clearly the term itself may be traced primarily to the writings of socialist theoreticians. Capitalism as a specific economic system cannot be understood without an analysis of the concept of economic system with a view to pointing out the function of this concept in economic science. The spirit, or the economic outlook, of capitalism is dominated by three ideas: acquisition, competition, and rationality. The technology characteristic of the capitalist system must also lend itself most readily to improvement and perfection. Modern capitalism made its appearance with the development of the capitalistic enterprise. In the period of full capitalism, which closed with the outbreak of the World War, the principles of profit and economic rationalism attain complete control and fashion of all economic relationships. The cyclical oscillations of the economic system, the rhythm of prosperity and depression characteristic of full capitalism, also become attenuated.