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Economies in the world we live in today are split to various type of economy. Capitalism and Socialism are 2 of the various type of economy we have today that is practiced by most countries. Capitalism is a type of economic system where free market that doesn’t have government interventions which the production is owned and managed by private individuals and institutions. It is also an economic system where individuals decide how much they want to produce and distribute. On the other hand, Socialism is an economic system where the economy is intervened by government and ownership of the production is not allowed. In this report, it is going to be filled with explanation of how Capitalism and Socialism works and how they differ from each other by using two countries as an example which is Germany as a country of Capitalism and Cuba as a country of Socialism. There are reasons for choosing both of these countries for the 2 respective categories. First of all, Germany is one of the largest and most important capitalist in Europe where it is the main creditor and funder for the Eurozone member states as well as gaining funds from Eurozone. Germany’s capitalism economic system once saved them from the period called the “Great Recession” and they also have a social market economy with highly skilled labor force. Moving on to Cuba , it was once a country that suffered a downfall from Socialism Economy led by Fidel Castro which later the power is handed over to his brother and from that point on Socialism managed to raise the living standards and the economy of Cuba. Although not much freedom in the market due to Government Intervention but Cuba is still one of the large socialist country amongst others.
Cuba is the country that will practicing socialism in economic which suggests the government owned and run all of the productions near them. Most of the Cuban doing work for their region is strictly discouraged, therefore forces the actual formation regarding self-employment and cooperatives. As corruption will be commonplace, mostly is attributable to the private enterprises and economy which can be largely state-controlled, it can be safe to be able to assume they’ve little respect of the law. Practice regarding force labor continues to be ongoing and mostly these types of workers are employed by the talk about. In term of providers, taxi people in Cuba is the most popular services that well known. Most of the taxi people are self-employed staff. Cuba has got to improve it of minicab driver since taxi is the main transportation for just about any peoples that will still influent about the roads in particular tourist. Thus, this situation can give large impact to the tourism in Cuba.
Starting off 2009, Cuba wanting to improve their industry output by revitalizing new purchase and growth of sweets processes as a way to upgrading their production regarding sugar. Poverty strikes the majority of the Cuban family, in form a contrast, the government supported these people with rationing system known as “Libreta de Abastecimiento” (Supplies Booklet), a rationing program which just as distributes 80% regarding food ration to be able to public having a coupon pamphlet. Although getting poverty, Cuba still the best in Human Development Catalog among the vast majority of Latin United states nations. The main reason Cuba can score elevated in Human Advancement Index simply because have elevated in ranking regarding metrics of health insurance and education, as their doctors will be ranked number 1 per capita. Not forgetting their forte, in becoming the best professional workforce on earth. They producing many vaccine including bacterial pathogens and the majority of the vaccine happen to be sold among other countries, in the Far East, India, Euro, Pakistan, as well as some Latin United states countries. Cuba should also give effort with their citizens’ wellness as a way to increase the item of providers in medical and pharmacy. Moreover, Cuba ought to reduce the actual Influence regarding Communism of their country to allow the peoples can improve their life and in the same time it is would bring a benefit for Cuba to become the modern nation sometime.
Germany happens to be ranked number 18 within world economic freedom standing (based around the 2014 List of Economic Freedom’s Lists). It is also known due to the status while Social Capitalism region, as personal enterprises tend to be highly encouraged alongside personal wealth development. In form a contrast, higher level of taxes is usually imposed as a fund with regard to social conventions. Even so, Germany was the 3rd world’s greatest exporter on the planet for 2011 which in turn worth $1. 408 trillion, Germany received 3 major sectors that provides them all these profit.
The most important is primary sector which contribute 0. 90% out of your profit has been Agricultural. Second sector has been manufacturing 30. 1% as well as tertiary sector that a lot of profitable sufficient to Belgium was assistance sector providing this region 70% out of it.
But nevertheless, Germany have very big issue to resolve in their particular county like lack involving natural sources like natural fuel, oil and so on that this kind of country exported through others big country like Russia.
This issues has to be solved by simply Germany to avoid any type of disturb that will affect their particular income like insufficient essential oil that stop food making generally used essential oil for the final product to society. More importance from various other countries will decrease this concern. As an outcome, Germany even now fulfilled the societies for their needs. Secondly Belgium need far more doctor in service sector, without a doubt. Service field had produced 70% out of their income but that can only handle few area and not in health-related like health professional, doctor and even more. Germany have to pay far more focus in this particular section that must be place country side. More medical professionals and Professional medical person were place on cities and in addition towns. These issues will be the most required service which society need to have. This is usually prevented through offering any good courses relating to healthcare that usually offered to students. Furthermore, importing health-related from various other friendly synergy from yet another country is usually encouraged because higher level of knowledge as well as technology is usually shared together.
Importance and Differences of two Country
Obviously from earlier we have learned the characteristics of each country. One is based purely on Socialism (Cuba), and the other one is a pseudo-Capitalism known as Social Capitalism (Germany). Both countries have their own way to manage their own economics environmental regardless of external or internal factors.
As for Cuba, due to historical factors, it has led the country to focus mainly on the good of society’s well-being. The idea of working under public sectors is strongly disagreed, thus leading communities to be independent from government and form their own job opportunity or employed under cooperation. As a result, job as a taxi driver or farmers are too many and common. In my opinion this is a good thing, for people not being too dependent to government. However, in current situation it is quite the opposite, it is mentioned that corruption are commonplace in Cuba. Plus, oppressions happen as only state entrepreneurs can enter economics agreements with foreign investors, meanwhile ordinary investors cannot. Aside from that, all line of production are owned and run by the government.
In Germany, the law and government is not too strict compared to Cuba, as government intervention is not too frequent in open market. Germany encourages the private enterprise with no minimum or fixed value to start-up a business. However, the price high level of taxes is imposed on each entrepreneur. Under the German Law, full protection and interest of security are recognized and enforced for foreigner’s property. Besides that, Germany’s anti-corruption measures are well planned and effectively eradicate the cases of corruption.
Both countries have economic factors of Services in their three main contributors of each country’s economic environment. For Cuba, job as a taxi driver is considered both Service and Tourism, considered as one of main job by people in Cuba and also the tertiary sectors in Cuban economic environment. In Germany, service sectors are the most profitable among top three contributor of Germany’s economic. Alongside Tourism and Service, Cuba also has Retail sectors, but due to reformation in economy, the Retail sector suffered the most as large part of the shops in the shopping districts are closed down in Havana. As mentioned earlier, Germany has Service sectors, which co-exists with two more sectors, Manufacturer and Agriculture.
In my opinion, capitalism (for an example, Germany) proposes a better way to manage the economical world with more systemic and proper way, leading to the financial stabilization of a country. In addition, I believe that the benefits along with the salary are more profitable than it actually seems as the entrepreneur can experiences difference in each market without frequent intervention by the government sectors.
Immediately after hours regarding research along with brainstorming, I am able to see that each of the system have their pros along with cons. Possibly not one system is usually too poor or also good. With an example, Germany may well encourage their individuals to be profitable, to take part in entrepreneurship in contrast, the price they should pay would be the high taxation payment. On some other hand, Cuba could possibly be too strict to the ordinary or local small business owner to endeavor and increase their enterprise, sometimes it might take them extra effort. In trade, 80% regarding food ration is inclined to public freely by using coupon pamphlets. In my opinion, we can easily practice many of the system they have so as to enhance Malaysia’s economic. For an illustration, we may well provide several food ration per month for the indigent, this way we can reduce the quantity of poverty within this country.
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