There is no dearth of people who are of the firm belief that capitalism signifies all that is evil in the society. They often use the age-old adage, 'the rich get richer and the poor get poorer' to paint this so-called prime evil. Having said that, there is certainly more to capitalism than what these people want to make you believe.
What is Capitalism?
Most academic journals define it as a condition where all the means of production and infrastructure are privately owned, thus handing the power to make decisions (and earn profits) solely to the capitalists, or the private owners. The forces of supply, price, distribution, and investment are solely in the hands of the private sector (the owners) in this case, thus leading to an inevitable sense of exploitation by them.
There is a general agreement that capitalism encourages economic growth rates, but the cost at which this is achieved is the main source of the debate. Today, an economy operating on a pure capitalist nature is not common, as more and more countries are adopting policies that reflect the nature of a mixed economy. This is in stark contrast to socialism, which emphasizes on government ownership of all means of production.
The Case for It
A non-capitalist country will see all the power and means of production fall in the hands of greedy bureaucrats, and this is the main advantage of capitalism. It prevents this from happening. Instead, it gives the power to entrepreneurs, who are driven by their own personal needs. This, in turn, leads to a chain of events where the capitalists do all they can to enhance production in order to earn greater profits, which inadvertently means that the economy surges ahead as a whole. The economy thus gets opened up with a greater deal of competition, which benefits everybody in the long run.
Greater competition means more efforts by the members of society, and this decentralized system of operation is good for everyone involved. Moreover, the consumers are free to choose what they want to purchase and free to spend their hard-earned money as and when they please. The society in general becomes more liberated and the standard of living goes up. With all these things in mind, it is hard to imagine that capitalism could actually be bad.
The Case Against It
In spite of all these benefits, critics always view capitalism with suspicion and skepticism. The reasons for this side of looking at things are also justified and in most cases, completely accurate. The major drawback here is that bigger and richer capitalists can exploit their workers and even prohibit other competitors from entering the market by monopolizing resources. If this happens, the entire purpose of competition is destroyed, but sadly this is a very real occurrence.
Moreover, a capitalist economy becomes very materialistic and money-oriented in nature, which affects the people morally and spiritually. The impact here is not a direct and explosive one, but more like a mild poison, slowly corrupting the minds of people. Economic disparities begin to rise, and this leads to a rise in many social evils and the crime rate. Overall, the society suffers some negative consequences, which it could have surely done without.
The biggest drawback though is that of exploitation, which stems as a natural result of wanting to earn more and more. People and resources are exploited ruthlessly, which leads to severe consequences in the long run.
Like we said in the beginning, the answer lies firmly in the manner in which capitalism is embraced in a country. No matter what economic system is employed, there will always be certain people and corporations that will try to take advantage of the weak and helpless. This is an inevitable evil of society. We would be kidding ourselves if we believe that socialism is not plagued by it.
It is for this reason that many countries are adopting a mixed economy today, where there is a mutually beneficial co-existence of capitalism and socialism. This opens up the economy to its benefits, while shielding the poorer classes from exploitation.
So the bottom-line is that there are both, advantages and disadvantages of capitalism, and to label it as simply good or bad is not possible.