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Labor I

Kyle Brandon James M. Lu


Block 3-A

Questions
1) What are the provisions in the Constitution which would state that the
Philippines is governed by a Capitalist System?
2) What is Capitalism?
3) What are the characteristics of Capitalism?

What are the provisions in the Constitution which would state that the Philippines is
governed by a Capitalist System?
 Art. II Sec. 19: The State shall develop a self-reliant and independent national
economy effectively controlled by Filipinos.
 Art. II Sec. 20: The State recognizes the indispensable role of the private sector,
encourages private enterprise, and provides incentives to needed investments.
 Art. III Sec. 10: No law impairing the obligation of contracts shall be passed.
 Art. XII Sec. 1: The goals of the national economy are a more equitable
distribution of opportunities, income, and wealth; a sustained increase in the
amount of goods and services produced by the nation for the benefit of the
people; and an expanding productivity as the key to raising the quality of life
for all, especially the underprivileged. The State shall promote industrialization
and full employment based on sound agricultural development and agrarian
reform, through industries that make full of efficient use of human and natural
resources, and which are competitive in both domestic and foreign markets.
However, the State shall protect Filipino enterprises against unfair foreign
competition and trade practices. In the pursuit of these goals, all sectors of the
economy and all region s of the country shall be given optimum opportunity
to develop. Private enterprises, including corporations, cooperatives, and
similar collective organizations, shall be encouraged to broaden the base of
their ownership.
 Art. XII Sec. 16: The Congress shall not, except by general law, provide for the
formation, organization, or regulation of private corporations. Government-
owned or controlled corporations may be created or established by special
charters in the interest of the common good and subject to the test of economic
viability.

What is Capitalism?
 Capitalism is defined as “an economic and political system in which a
country's trade and industry are controlled by private owners for profit,
rather than by the state.”1

What are the characteristics of a Capitalist Economy?

1 Oxford Dictionary of English


 Two class system: The division of society between the capitalists or the people
who own the means of production and capital and the working class “who sell
their labor to the capitalist class in exchange of wages.”2
 Profit Motive: Although private enterprise satisfies the needs and wants of the
market, their end is to maximize their profits in their conduct of selling goods
and services.3
 Minimal Governmental Intervention: Despite the belief that the market should
be left alone for it will correct the inefficiencies by itself, the Government exists
to regulate the market as provided by the Constitution and by law. 4
 Competition: Competition is essential in capitalist societies because in this way,
it is the market that dictates the price of goods and services unlike a monopoly
where it is the seller that dictates the price.5

2 Kristina Zucchi, Main Characteristic of Capitalist Economies, available at


https://www.investopedia.com/articles/investing/102914/main-characteristics-capitalist-economies.asp (last
accessed August 8, 2018).
3 Id.
4 Id.
5 Id.