Question

*Urgent*

In what ways did the government contribute to the growth of American capitalism?

Answer 1

In a capitalist economy, the role of government is very limited. The main functions of government, as given by Adam Smith, are to maintain law and order in a country, make national defense stronger, and regulate money supply. According to Smith, the market system administers various economic functions.This wealth – sometimes called 'capital' – had to be invested somewhere. It was used to pay for the industrialisation of Europe. So the transatlantic slave trade and plantation wealth were the major causes of the growth of capitalism in Europe.

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