The meaning and Characteristics of Competitive Capitalism (Free trade Capitalism)

. Competitive Capitalism (Free trade Capitalism)

This was the stage in the development of capitalism after mercantilism. This stage was featured by free competition among the industrial capitalists with much concentration on industrial production. This period started from 1740's and ended in 1870 when new stage of capitalism (Monopoly Capitalism) came in existence. It known as competitive capitalism because it was governed with free competition in production of raw materials, wealth and discoveries of different productive forces which facilitated and quickened industrial production.


Characteristics of Competitive Capitalism.

• The phase was characterized by the rise of large-scale industries, which brought about industrial revolution.
• It was a free trade system with minimal government tariff policies.

• Massive introduction of machines which easened production.

• State played minimal role in production as this this was left to individuals.

• Raw materials were necessary, therefore there was important of raw materials.

• There was no monopoly of internal and foreign markets by few capitalists because none of the competitors was strong enough to eliminate the others from the competition.

• There was a sensational speeding up of transportation and communication in Europe than ever before.

• In free trade imperialism, palm oil, coconut and other oil products were highly needed as Lubricants of the machines and for soap manufacturing. Free trade system continued up to 1870. By this time due to contradiction in the capitalist’s system free trade go to monopoly capitalism.