Capitalism is an economic system based on the private ownership of the means of production and their operation for profit . [1] [2] [3] [4] Central characteristics of capitalism include capital accumulation , competitive markets , price systems , private property , property rights recognition, voluntary exchange , and wage labor . [5] [6] In a market economy , decision-making and investments are determined by owners of wealth, property, or ability to maneuver capital or production ability in capital and fin
Economists , historians , political economists , and sociologists have adopted different perspectives in their analyses of capitalism and have recognized various forms of it in practice. These include laissez-faire or free-market capitalism , anarcho-capitalism , state capitalism and welfare capitalism . Different forms of capitalism feature varying degrees of free markets , public ownership , [8] obstacles to free competition and state-sanctioned social policies . The degree of competition in markets and t
Capitalism in its modern form emerged out of agrarianism in 16th century England and mercantilist practices by European countries in the 16th to 18th centuries. The Industrial Revolution of the 18th century established capitalism as a dominant mode of production , characterized by factory work and a complex division of labor . Through the process of globalization , capitalism spread across the world in the 19th and 20th centuries, especially before World War I and after the end of the Cold War . During the