Free enterprise, also known as capitalism, is a system of business practices ruled by supply and demand without restraint from government influence. Businesses, not governments, are allowed to decide where they operate, what they sell and how much their products cost in a free-enterprise system.

History

The roots of free enterprise can be traced to the Middle Ages when merchant capitalism gradually began replacing feudalism.

Individual Freedom

Markets have the ability to operate as they see fit with little or no government interference in a true free-enterprise system. The onus is placed on the individuals of a society to decide what businesses survive by "voting" with their pocketbooks.

Efficiency

One of the main components of free enterprise is to effectively use resources by determining what products are needed by the demands of a society.

Modern Business

Free enterprise is the United States' mode of economy. Entrepreneurs in the United States are free to establish more efficient and productive businesses with profit as an incentive to streamline practices and supply what a society wants.

Future

Free enterprise is poised to become the dominant world economic system. India, China and other fast-developing nations are adopting it because they believe that joining other powerful countries that operate under this system is crucial to the health and growth of their own national economies.

Source:

Emergence of capitalism

Resource:

Basics of free enterprise