Free enterprise

The concept of free enterprise asserts that every entity has private ownership and control over his work. As such, this means that he can do with it whatever he wishes, and therefore benefit from it as much as he can. Under free enterprise, therefore, individuals are recognized as entities who are able to think for themselves. Their use of their own labor resource is completely dependent on their personal decisions.

The idea of free enterprise is very often interchanged with that of the free market. The two ideas share similar characteristics, in the sense that they are averse to unnecessary external controls, but they are actually separate from each other. While free enterprise deals mainly with an individual’s rights to utilize his labor resources as he sees fit, the idea of a free market has more to do with giving businesses and markets the freedom to develop as they will under the natural forces of supply and demand. As such, free market frowns upon the idea of government intervention in the workings of the market.

The idea of free market encourages private businesses to operate as efficiently and as profitably as possible without artificial restrictions. In the process of doing so, it may be possible to run contrary to the idea of free enterprise, because aiming for maximum production may entail imposition of strict controls over individual workers. This violates the concept of free enterprise since workers are no longer self-determining. It is for this reason that it is necessary to establish the distinction between the two concepts.