Witte introduced industrialized capitalism in Russia believing that it establishes competition and free trade which then results in development bringing prosperity to the individuals. The capitalists, Smith and Witte being on top of the list, strongly believed that competition and free-trade provides not only the earning opportunities to both the businessmen and the laborers but also the quality driven affordable products to the consumers. In their point of view a happier and successful individual will give rise to a happier and successful nation and country.
The father of the free-market capitalism, Adam Smith further mentioned in his book, "The Wealth of Nation", that "It is not by gold or silver, but by labor, that all the wealth of the world was originally purchased" (Smith, 1776).
The basic message expressed by Smith in "The Wealth of Nation" can be simplified as life is all about give and take. Somebody's necessities or luxuries fulfill other man's necessities or luxuries. This means that not only the laborer fulfills his demands by working for the business owner but also the business owner fulfills his demands by providing work to the laborer. This is how people are dependent on each other. Such collaborative efforts of the people of a nation bring harmony and success to them.
The other very common concept explaine...
This approach of monopoly can be restrained by having competition in the market. The business man will never lower its supply or production knowingly that it will benefit his competitor instead of him. The competition thus, reinforces the benefit of the consumer providing him better products within lesser prices. This approach of competition via capitalism by Smith inspired Sergei Witte who then implemented it in Russia and thereby, brought advancement and development in Russia. But in contrast to Smith, who emphasized over free market, Witte proposed protectionism in his capitalistic vision.
In free market, government does not intervene in the market instead it just regulates the market against fraud or corruption. Only property rights are protected by the government with no regulation, subsidization, single monetary system, and governmental monopolies. Whereas Protectionism is the economic policy adopted by the government to impose barriers to trade. Protectionism is also referred as fair trade by it supporters. It is meant to protect the domestic industry from foreign competitors by imposing tariffs, subsidies, import quotas, or other restrictions or handicaps placed on the imports of foreign competitors.
Capitalism was strongly condemned by Karl Marx a nineteenth century philosopher, economist, journalist, and revolutionary. He mentioned in his work, "The Communist Manifesto" that
"Economic Competition and the pursuit of self-interest created only anguish, inequality, and the exploitation by the "haves" of the "have-nots"." (Marx, 1848)
This argument was then perceived by many illustrating that capitalism limit the power and wealth in the hands of few people belonging to the elite