What are the Disadvantages of Capitalistic economy?


The capitalistic economy suffers from the following weaknesses:

Inequality of income: The main disadvantage of capitalistic economy is inequality of income. Rich become richer due to economic freedom to own property economic development and the law inheritance. Poor go on becoming poorer. Wealth is centred in certain hands.

Class struggle:


The society is divided in two classes-the rich and the poor. The richer people exploit the poor workers. They are paid low wages. Workers demand higher wages. Employers oppose their demand. The conflict between the workers and capitalist goes on. Strikes and lockouts become the common feature.

Unbalanced growth:

Industria-lists promote only those industries, where margin of profit is more, so basic, essential and service industries are ignored. Industries tend to concentrate in certain industrial pockets. Certain regions are neglected. Village industries are ignored. There are developed and undeveloped regions in the economy.

Economic insecurity:


Inequality of income, regional imbalances, class struggles make the economy very insecure. There is economic unrest. Strikes and lockouts are the features of the day. The conflicts between the workers and management, and have and haves not lead to economic insecurity.

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