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SOCIOL 1A06 Study Guide - Piece Work, Psychopathy, Flextime

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Tina Fetner

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Chapter 14- capitalism and the economy
A brief history of capitalism
Capitalism is an economic system in which property and goods and primarily
privately owned; investments are determined by private decisions; and prices,
production, and the distribution of goods and determined primarily by competition
in a free market.
Feudalism is an economic system characterized by the presence of lords, vassals,
serfs and fiefs
Before capitalism, the dominant economic system was feudalism
Agricultural revolution is the introduction of new farming technologies that
increased food output in farm production
Corporation is a legal entity unto itself that has a legal personhood distinct from that
of its members- namely, uts owners and shareholders
Theorizing the transition to capitalism
Adam Smith argued that competition, driven by people’s inherent self-interest
and drive to trade, helps maintain a cohesive society. He also stated that
specialization is a key to increased productivity and innovation, and that the use of
money, as opposed to barter, makes trading more efficient.
Georg Simmel saw the evolution of monetary payment systemsfrom piecework
payment to wage labor to salaried workas a force to depersonalize exchange.
Moreover, he felt this was a positive change that helped create separate public
and private spheres and gave workers more freedom to enjoy the private, or
leisure, sphere.
Karl Marx argued that capitalism created alienation in workersalienation from
the products they produced, alienation from the production process, alienation
from one another, and alienation from themselves and their creative tendencies.
Marx predicted both that capitalism would ultimately destroy itself and that the
working class would rise against the capitalist class, leading to a period first of
socialism and then communism.
o Alienation is a condition in which people are dominated by forces of their
own creation that then confront them as alien powers; according to Marx
the basic state of being in a capitalist society
o Socialism is an economic system in which most or all the needs of the
population are met through non-market methods of distribution
o Communism is a political ideology of a classless society in which he means
of production are shared through the state ownership and in which
rewards are not tied to productivity but need
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