What Are The Drawbacks Of Unregulated Capitalism?

1.	What Are The Drawbacks Of Unregulated Capitalism?
Answer» Unregulated capitalism suffers from certain drawbacks: As investment ALLOCATION is guided by the profitability criterion, sufficient investment may not take place in areas where profitability is low, however essential they may be. The right to property and FREEDOM of enterprise are likely to lead to concentration of INCOME and wealth and the widening of interpersonal income disparities. Though, according to the theory, there will be free COMPETITION, in the real world the large firms are likely to gain an advantageous position which would eventually lead to monopolies. Unregulated capitalism suffers from certain drawbacks:

Answer»

Unregulated capitalism suffers from certain drawbacks:

As investment ALLOCATION is guided by the profitability criterion, sufficient investment may not take place in areas where profitability is low, however essential they may be.
The right to property and FREEDOM of enterprise are likely to lead to concentration of INCOME and wealth and the widening of interpersonal income disparities.
Though, according to the theory, there will be free COMPETITION, in the real world the large firms are likely to gain an advantageous position which would eventually lead to monopolies.

Unregulated capitalism suffers from certain drawbacks:

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