An economic system characterized by private ownership of the means of production, where investment and production decisions are primarily determined by individual owners and businesses in pursuit of profit, operating within a market economy. Competition amongst these privately owned entities drives innovation and shapes prices based on supply and demand. A key example is the rise of joint-stock companies during the early modern period, where private individuals invested capital into ventures like exploration and trade, seeking returns based on the success of those ventures.
The emergence and spread of this economic model had profound effects on global interactions. It fostered increased trade, fueled colonialism, and spurred industrialization. Its emphasis on efficiency and innovation led to significant advancements in technology and productivity. However, it also contributed to social inequalities and exploitation as wealth and resources became concentrated in the hands of those who controlled the means of production. The pursuit of profit often overshadowed ethical considerations, leading to environmental degradation and social unrest.
