Capitalism is the life style in which system of economy is entirely privatized. In this system, markets and organizations are privately governed with the ambition of the profit maximization. This system was popular in the west as the result of industrial revolution in the west. In this economic system, industries and trade is carried out through the independent will of the industrialist and governments cannot intervene in the matters of the industries.
In modern times the concept of the capitalism moved out of the west to the other continents as the result of firstly colonist or imperialism and later on by globalization of the world (Bush, 2014). In capitalism governments get the taxes from the industries and industries get the facilities from the governments. So industrialism can be considered as the advent of the capitalism in the world.
Socialism is the economic system in which any activity of the industry or any other economic movement is controlled by government or the people and economic activity will not only benefit the individuals own that industry or the property but it will be for all. Karl Marx advocated this view that economic system should not be encapsulated by the few rich and powerful ones but it should be the property of the all who work in it and it is the duty of the government to provide people their basic necessities from the generation of the wealth from these economic activities (Elster, 1986).
Latter on socialism transferred in communism. This economic system was the response to the economic conditions of the people who work in the industries and lands producing big profits for the owners and the people working in them were suffering. Several trade unions and workers unions were formed which actively precede the case of these workers. Nationalization of these industries and land took place in many parts of the world. But after sometimes Communism failed to deliver the results expected from it and are not popular around the world.