place in the latter half of the 18th century. The first was the appearance of the physiocrats in France after 1750; and the second was the devastating impact that the ideas of Adam Smith had on the principles and practice of mercantilism. They in turn paved the way for the industrial revolution and modern capitalism. Capitalism is an economic system in which private individuals and business firms carry on the production and exchange of goods and services through a complex network of prices and markets, which is different from mercantilism because of the private ownership of business. Although rooted in antiquity, capitalism is primarily European in its origins; it evolved through a number of stages, reaching its zenith in the 19th century. From Europe, and especially from England, capitalism spread throughout the world, largely unchallenged as the dominant economic and social system until World War I ushered in modern socialism and then communism as a powerful competing system. ( Encarta 2000)After World War I, Russia came out of the war a socialist country that was controlled by the people, according to Marxs theories. Socialism is an economic and social doctrine, political movement inspired by this doctrine, and system or order established when this doctrine is organized in a society. The socialist doctrine demands state ownership and control of the fundamental means of production and distribution of wealth. The doctrine specifically advocates nationalization of natural resources, basic industries, banking and credit facilities, and public utilities. It places special emphasis on the nationalization of monopolized branches of industry and trade, viewing monopolies as inimical to the public welfare. It also advocates state ownership of corporations in which the ownership function has passed from stockholders to managerial personnel. In theory the difference between socialism and the next level of Marxs societies evolution, communism, ...
