Question

What are the rules of the game in The capitalist economy and how did they develop?

Answer 1

The primary rule of the game in capitalistic economy is free competition, without the interference of the government and without any deception and fraud. Hence, the Laissez faire is another rule of the game in capitalist economy. Besides, the rule of the game is dominance of market forces in the economy, economic freedom awarded to the individuals and consumer sovereignty. Further, the capitalistic economy also promotes the private property rights that ensure a most favorable environment for the merchant to perform economic activities and acquire wealth as private property.
It got developed as an extension of mercantilism that started after the feudalism in 16th century. Merchants performed trading activities and gained wealth to perform international trade and started acquiring assets in overseas countries also when the foreign trade was established. It was based upon the consumer demand and supply mechanism with government playing a negligible role in controlling the trade activities.