Describe an efficient economy please . Efficiency is producing the same goods with less cost , or better goods with the same cost . Why are you assuming loans are illegal ? Because a loan implies private property most likely money being rented at profit , which socialists consider exploitation . Why are you seemingly asserting that bikes can only be made by an assembly line ? I ' m not , it ' s just the assembly line is the most efficient way to do it . Doing it in a less efficient way means you i . e . society have less time to produce things that aren ' t bikes or maybe you just want leisure time . The difference between capitalism and socialism is that in capitalism there is exclusive profit . Exclusive to who ? Market socialism the profit is exclusive to the group who produced it . I ' m guessing you meant exclusive to the individual or shareholders I guess . Do you value things or people more ? People . If you value things then your a capitalist . If you value people your a socialist . The key difference is right there in the name . No , I ' m definitely a capitalist . I ' m a capitalist because I think it ' s the best economic system , measured in terms of human benefit and freedom . At this point your probably digging around for a historical citation of the abuses of despotic leaders who said they had socialist governments . That ' s fine , go ahead and pick one or several . I actually agree they ' re pretty bad examples of what most people here describe as socialism . I ' d call them state socialism and they ' re absolutely socialist , and like everything the state touches they ' re left in ruin . Just know that to be able to actually judge socialism fairly , it has to be allowed to become as prolific as globalized capitalism is now . The problem is you have no real evidence or theory that your system would function well at all . There ' s several crippling economic reasons which have never been addressed properly that show your system would never work in theory , let alone practice . Economic Calculation Problem is a prime example . Interestingly , regulated capitalism under a state seems to work more or less fine . The problems that result from it are almost always the fault of state regulation . So we basically have hundreds of years of evidence that capitalism works extremely well . On the other hand , the only real evidence we have about socialism is all the failed socialist states that result in famine and mass poverty . They show that economic central planning is a complete failure and will never work . To be fair , you have anarchist Catalonia from the 1930 s which , if the sources are to believed worked fairly well for the 10 or so years it existed . The problem is that ' s very little evidence to support your cause , and personally I think it ' d probably have failed due to corruption and power accumulation given another 50 years . Unfortunately it didn ' t last that long so we don ' t know .