Capitalism - GCSE Sociology Definition

Capitalism is an economic system where private individuals or businesses own and manage the production and distribution of goods and services, rather than the state. It is characterised by the goal of generating profit, competitive markets, and the free exchange of goods and services.

In capitalism, supply and demand determine prices and the allocation of resources, with minimal government intervention. This creates a consumer-driven environment where businesses strive to innovate and improve efficiency to attract customers.

For GCSE Sociology students, understanding capitalism is important as it influences social structures, class divisions, and the distribution of wealth and power in society.