The Role of Self-Interest and Competition in a Market Economy

A market economy is an economic system in which individuals own most of the resources – land, labor, and capital – and control their use through voluntary decisions made in the marketplace. It is a system in which the government plays a small role. In this type of economy, two forces – self-interest and competition – play a very important role. The role of self interest and competition was described by economist Adam Smith over 200 years ago and still serves as foundational to our understanding of how market economies function. [Read more] ...