Capitalism vs Feudalism: Difference and Comparison

Since time immemorial, there have been several different economies worldwide. An economic system defines the mechanism of production, distribution, and allocation of goods, resources, and services in a given society or a particular area.

The different types of economic systems include the capitalist economic system, the socialist economic system, the mixed economy, and communism.

The basic build-up of this system comprises the factors concerned with what needs to be produced, how it has to be produced and in what amount, and who will receive the output.

National economies can widely differ concerning unemployment, taxation, economic growth, income inequality, etc., and heavily impact the structure of society.

Key Takeaway

  1. Capitalism is an economic system based on private ownership, free markets, and the pursuit of profit; feudalism was a social and economic system prevalent in medieval Europe based on a land ownership and obligations hierarchy.
  2. Capitalism encourages competition, innovation, and growth through investment and entrepreneurship; feudalism limited social mobility and relied on agricultural production and labor.
  3. Capitalism allows for individual freedoms and private enterprise, while feudalism involves obligations and duties based on birth and social status.

Capitalism vs Feudalism

Capitalism refers to the privatization of the public institutions and resources and profits as well. Feudalism is the socioeconomic system where the land and resources are owned by elite class and landlords where peasants work in the lands in exchange of safety and money.

Capitalism vs Feudalism

Comparison Table

Parameter of ComparisonCapitalismFeudalism
Type of economic systemCapitalist economic systemSocialist economic system
Aim/purposeProfit of the higher classes is the main purposeTo make wealth and distribute it equally among all people and run the kingdom efficiently
OwnershipOwned by the public or corporate sectorOwned by the nobility or government
HierarchyConsists of the lowermost worker class, the ones who enjoy the food, the killers, the foolers, and the topmost ruling classIt consists mainly of the nobility (or government) and the peasantry. The peasants are at the base level, preceded by the knights and tenants, and the ruler at the topmost level  
Role of governmentThe government only monitors the processesThe government assumes coercivity
ProsInnovation is rewarded, and better products receive higher pricesThe stability of the kingdom is maintained, and since the nobility and the  peasantry are the only two classes, it promotes equality among the peasantry
ConsInequality among the classes leads to the worsening of the conditions of the lower classes. The economy’s dependence on land and agriculture led to its decline when the peasantry became self-sufficient.
HistoryIt emerged during the early Renaissance and still exists today in its modern form.It was dominant in medieval Europe during the 8th century AD/CE, and its disadvantages led to its decline.

What is Capitalism?

Capitalism is the capitalist economic system characterized by the private or corporate dominion of capital goods involving investments under the private decision and manufacture, distribution, and allocation of goods as determined by the needs of the free market.

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A capitalist economy is primarily aimed at making a profit. The role of the government in such an economy is only to monitor the processes rather than assuming coercivity. The hierarchy of this system involves the workers at the base level who feed all the other higher levels.

The second level is dominated by the ones who eat the food (i.e., enjoy the benefits offered by the base class), preceded by the topmost class comprising the ones who rule everyone else and receive most of the profit. This leads to the greatest disadvantage of capitalism, which is inequality.

In this way, only the topmost section of the capitalist pyramid benefits. It progresses the most, whereas the base class, who works the hardest, is more strongly drawn into the circle of poverty.

The term ‘capitalism’ gained popularity due to Karl Marx, who stated that capitalists owned the means of production (the private class) and employed other laborers in pursuit of their profit in his work ‘Das Kapital.’

The advantages of capitalism, like rewarding innovation and receiving higher prices for better products, are shaded by the harsh truth that the labor of those lower in the pyramid enriches those at the top.

Although it encourages people to compete against each other for a better position, it cannot provide enough space for everyone to reach the top o the pyramid, irrespective of the turmoil put into it.


What is Feudalism?

Feudalism is a socialist economic system dominant in medieval Europe roughly from the 8th to 15th century AD/CE. It mainly consisted of the classes, the royalty, the nobility, the knights, and the peasants.

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The nobility held lands under the crown and leased them to the knights in exchange for military service, and the peasants were obliged to live on the nobles’ lands and do their service. Unlike feudalism, every member of the society was involved with feudalism.

It kept peace and protection among the land and maintained the kingdom’s stability, although the royalty and the nobility liked and supported it while the serfs and slaves did not enjoy it.

The king was the one who had complete control over the feudal system, owned all the land, and made decisions related to it.

The barons, also called the nobles were powerful and wealthy people who chartered the land from the king and rented it out to the knights in exchange for military service as demanded by the king. The lowest section of the society comprised the vassals, serfs, slaves, or the peasantry.

These were the people who were under the protection of the barons and vowed them homage, fidelity, labor, and a part of their produce. With increased trade opportunities, the peasantry became self-sufficient, ultimately leading to the decline of the land and agriculture-dependent feudal system.


Main Differences Between Capitalism and Feudalism

  1. Capitalism refers to the capitalist economic system, whereas feudalism comes under the socialist system.
  2. Unlike capitalism, everybody in society is involved with feudalism.
  3. The private or corporate sector owns and runs the capital economy, while the nobility or the government owns the feudal system.
  4. The government only monitors the processes in the case of capitalism but assumes the coercive power in the feudal system.
  5. The hierarchy of capitalism involves workers/laborers, the clergy, the bourgeoisie, and the ruling class, whereas the feudal system consists of the peasantry, the military, the nobility, and the royalty.
  6. Capitalism originated in the Renaissance period and continues to date, but feudalism prevailed from the 8th to 15th century AD/CE.

Last Updated : 14 October, 2023

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10 thoughts on “Capitalism vs Feudalism: Difference and Comparison”

  1. The article provides a thorough comparison of capitalism and feudalism, shedding light on their purposes, ownership, roles of government, and history.

  2. The piece brings out key differences between capitalism and feudalism, giving a clear understanding of these economic systems.

  3. The article presents an insightful comparison of capitalism and feudalism, analyzing their pros and cons in a detailed manner.

  4. The article’s description of capitalism and feudalism is a compelling read, providing valuable insights into both economic systems.


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