Georgia’s Role in the New Era of Capitalism

Modern global political and economic transformations raise critical questions about the essence of capitalism and its evolving directions. 21st-century capitalism includes new forms that differ significantly from the classical model described by Adam Smith in his writings.

Classical capitalism, based on the principles of a free market and competition, is often represented by Adam Smith’s “invisible hand” theory. According to Smith, actions taken in pursuit of personal interests ultimately serve the public good. This principle continues to be a fundamental philosophy of market economies; however, today’s economy is vastly different from the economic model of Smith’s time, as it involves complex interactions between the state, corporations, and society.

Today’s economic reality shows that the principles of the free market are being violated and adjusted to serve corporate interests. The strengthening of global corporations and their control over markets has weakened competition. Such monopolistic practices and cartels have significantly reduced economic dynamism, which is in direct contradiction to Smith’s ideal situation, where competition and personal interests align with the overall well-being of society.

Under globalization, developing countries are growing under the rule of multinational companies, creating unequal relationships that weaken local economic and social structures. Technological progress, particularly the growth of digital platforms and social media, has exacerbated existing problems, as small and medium enterprises find it difficult to compete with large corporations and access the market. This situation creates a highly concentrated competition model, rather than a truly free one.

Interestingly, in addition to his work on “The Wealth of Nations,” Adam Smith also wrote “The Theory of Moral Sentiments,” which emphasizes moral values and ethics in economic activity. Ignoring this important part in favor of profit in modern capitalism often leads to social inequality and neglect of societal interests.

America’s economic policy clearly demonstrates these two divergent paths of capitalism. In recent years, political leaders and corporate elites have demanded liberalization and deregulation, which, on the one hand, promoted some aspects of economic growth but, on the other hand, increased social inequality and strengthened corporate monopolization. All of this stands in direct conflict with Smith’s idea that fairness and morality are integral parts of a free market system.

Today’s economic reality calls for a transformation of capitalism that recognizes the importance of social responsibility and sustainable development. One such transformation is “inclusive capitalism,” which aims to involve society more broadly in the economy and acknowledges that sustainable development should not be measured solely by economic growth indicators but by human well-being and quality of life.

Inclusive capitalism is based on close cooperation between the state, business, and society, where economic growth and social well-being develop together. This model calls for increased investment in education, healthcare, and environmental protection, which will reduce economic inequality and create new jobs. The use of new technologies and innovative approaches in the economy is critically important for creating a sustainable economic model that ensures equal opportunities.

For Georgia, which seeks rapid development and success in the international economic system, it is important to choose a path that ensures not only global integration but also considers the country’s social and ethical development. Georgia’s economy should align with the principles of inclusive capitalism, with a focus on fairness, equal opportunities, and the common good of society.

In Georgia’s economy, initiatives have already emerged that aim to support small and medium businesses, encourage innovative startups, and promote social entrepreneurship. However, a clearer vision and strategic development are needed to make these initiatives sustainable. This requires cooperation with international partners, the use of new technologies, and the creation of innovative products and services to ensure the country’s competitiveness in global markets.

Today’s capitalism faces many challenges, including the influence of global corporations, the reduction of competition, and the neglect of ethical values. These circumstances raise the question of how capitalism should evolve without losing its fundamental values. The new capitalism must strengthen moral and ethical principles that ensure fairness, social well-being, and environmental protection.

For Georgia, this is a unique opportunity to choose a path of development that ensures not only economic growth but also improves the quality of life and achieves social stability. Our goal is to create a form of capitalism that serves not only corporate interests but also the well-being of every citizen. This means that the economic system must be more inclusive, fair, and sustainable, ensuring equal opportunities and a pathway to success.