It is undeniable that capitalism is responsible for the fast growth of economies marked by technological advancement, growing production efficiency and alleviation rates. However, this comes at a cost in a cycle that involves the poor and the rich in the society where the former is disadvantaged. Underlying the impressive capitalistic driven developments as by-products of the pursuit of capital and power accumulation, are social and economic problems. Of notable impact is the high social class inequality created by the huge differences between the poor and the rich in wealth distribution patterns that inhibits the growth of living standards for all.
David Harvey argues that even though poverty rates have gradually been reduced, it does to necessarily imply better living conditions for all. The capitalistic economy has seen the growth of profits but a huge difference in wage structure making it unbearable for people with low income rates or no employment. The wage mechanisms constructed seek to boost profit making and capital development with little impact on improving the living standards of the lower classes. Schillers article on digital capitalism in crisis similarly points out the perspective of capitalism having a low development impact on social problem like diminished wages and unemployment alleviation for profit growth. The growing high profit-making investments in the capitalistic industry still presenting eventually converged on a new and deeper financial-economic crisis marked by layoffs and inequality burdens.
Arguably, the profit driven capitalistic economy can be linked to inequality in wealth distribution, exploitation-based monopoly power, monopsony where the market power is used by business to grant lower wages and environmental costs and externalities. Despite the various expanding industries, International Labor Organization 2019 highlights that 2 billion of the 3.3 billion in the global labor market are informally employed putting them at an economical risk. The low rate of formal employment shows how capitalistic entities continue to thrive with low impact on aspect such unemployment rates. In addition, capitalistic markets drive towards limited regulations on resource use posing an impact on resource abuse which leads to problems such as pollution and resource depletion. Considering the negative impacts of capitalism for the benefit of a few people within a society, its is questionable if capitalistic economies are meant for the betterment of the society.
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The extensive growing network of capitalistic industries are set to maintain their low impact of society development with only owner and investors being able to enjoy the developments achieved. It is imperative to note that as more capitalistic entities grow, the lower the possibility of utilizing available resources in the betterment of the whole society. Capitalism only drives towards private gains of a few with minimal regulations that hold entities responsible in bettering the lives of the society for resources exploited. The worlds resources will be depleted for capital and profit accumulation interests while neglecting the improvement of living standards for all social classes.
