Capitalism and Socialism
Study Questions
The Basics
Which system—capitalism or socialism—is driven by the goal of providing a product or
service at a profit?
Which system—capitalism or socialism—is driven by the goal of providing a service or
product without regard to the individual’s ability to pay (no profit)?
Is Domino’s Pizza mostly socialist or capitalist? Why?
Is the public school system mostly socialist or capitalist? Why?
Is a policy of tax cuts for the purpose of giving people and business more money that
they can spend or save as they wish capitalist-oriented or socialist-oriented? Why?
Is a policy of tax breaks for the purpose of encouraging a business to install energyefficient lights capitalist-oriented or socialist-oriented? Why?
Is a policy to pay farmers a subsidy (a cash payment from government)—so that the
farmers will grow less of a crop so as to raise the price of that crop when it is sold at
market—capitalist-oriented or socialist-oriented? Why?
Is a policy to place a cap on the amount a pharmaceutical company can charge for a
prescription drug capitalist-oriented or socialist-oriented? Why?
The NFL is a capitalist organization that employs a component of socialism in its
business plan, with the goal of maximizing its advertising revenue. What is the
component of socialism?
Why is socialism (the word) considered bad in America?
Why Economics is so Important
Why would a “man-to-the-moon-like” program to address climate change (or global
warming) be a socialist-oriented policy?
An International Perspective
On the scale of capitalism-socialism, if Sweden scores 21.0 on “Government Spending,”
does that mean that Sweden has “big” government or “small” government?
In America, we think of Sweden as a “socialist” democracy, but if its overall capitalismsocialism score is 76.1, is Denmark majority-capitalist or majority socialist?
If Canada has a universal health care system and America does not, then why is that the
Heritage Foundation finds Canada as having a more capitalist economy than the U.S.?
China is officially a “communist” country, but given its capitalism-socialism score of
52.5, is China majority-capitalist or majority socialist?
Comparing the scores on “Property Rights” in the 10 most capitalist countries to the
scores in the remaining communist countries (plus Venezuela), how do the communist
countries rate on the protection of property rights—good or bad?
The GINI Index
Which country has the “best” GINI scores (income and wealth is distributed more equally
across society)?
Why does Ethiopia have a relatively good GINI score, even though on balance, it is a
very poor country (i.e., most people are very poor)?
Advantages of Socialism and Capitalism
If a country wants to accomplish a major goal quickly, such as putting a man on Mars,
which program is most likely to achieve that goal first—a socialist program or a capitalist
program?
A capitalist business climate tends to produce people like Thomas Edison, the Wright
Brothers, and Michael Dell. Why is that?
According to the lecture, why don’t places like the Congo and Iran produce people like
Thomas Edison, the Wright Brothers, and Michael Dell?
Disadvantage of Socialism and Capitalism
Why is a speculative market in a capitalist system bad?
Why is a thriving capitalist sector of an economy necessary in sustaining the socialist
elements of an economy?
Why Capitalism Prevails in America
If someone argued that inequality in income and wealth is good, would that be a
capitalist-oriented or socialist-oriented argument?
If someone argued that it is wrong for people to be denied health care coverage because
they cannot afford it, would that be a capitalist-oriented or socialist-oriented argument?
Why aren’t the American people protesting in the streets about their grievances toward
our capitalist system?
Do polls show that Americans hold more capitalist values than Europeans?
In responding the financial crisis (2008-present), did George Bush and has Barack
Obama pursued socialist-oriented or capitalist-oriented policies?