In the capitalist economic system can be owned and controlled by private corporations. In a free market, markets have minimal regulations in the pricing mechanism; hence it is determine the manipulation of the market demand and supply. There are three main components of Capitalism

1) Capital Accumulation

Capital (Money) is used as a standardized medium of exchange/payment, and also as a form of valuation of the good and services that are in the market. The accumulation of capital refers to the generation of capital from the initial sum of financial capital to get a profit.

 

2) Financial Markets

In order for the exchange to take place, there is a need for the existence of a financial market where there is an exchange of capital goods and services.

 

 

3) Wage labor

Capitalism coined the term wage labor where workers received a salary/wage for their labor in the production process.